Bitcoin mining difficulty hits a new record

As a result of the latest difficulty adjustment, Bitcoin’s mining difficulty rose by 3.44% to a new high of 36.84 T.

The average hashrate stood above 260 EH/s. The interval between blocks during the period since the previous difficulty adjustment was 9 min 40 sec.

According to Glassnode data, the maximum value of Bitcoin’s network hash power (smoothed 7-day moving average) was recorded on October 11 — above 266 EH/s. As of October 23 the figure had fallen to 261.6 EH/s.

Analysts at the research firm noted that hashprice reached a record low of $66,500 per EH/s.

The #Bitcoin Hash Price has reached an all-time-low of $66,500 per Exahash.

This means that $BTC miners are earning the smallest reward relative to hashpower applied in history, and likely puts the industry under extreme income stress.

Live Chart: https://t.co/RQzSsh9FnF pic.twitter.com/ExfpR5sOOq

— glassnode (@glassnode) October 24, 2022

“This means Bitcoin miners are earning the smallest reward in history relative to the hash power deployed. This is likely to put substantial stress on the industry in terms of earnings,” analysts said.

Earlier in October, with lower hashrate and difficulty, Glassnode assessed the ‘pain threshold’ for miners at $18 300. If quotes fall below this level, 78 400 BTC owned by miners would be at risk of liquidation, experts warned.

In May, publicly listed mining companies first sold all mined Bitcoins. By June they liquidated around 23% of their reserves in the first cryptocurrency, selling 14 600 BTC. In July the trend continued — firms sold 5 767,9 BTC with a total mined of 3 478 BTC.

However in August and September publicly listed miners already sold fewer bitcoins than they mined, resuming accumulation.

Foundry noted that, in this environment, the mining equipment market “is trapped in a deflationary spiral”. A gap has emerged between prices offered by sellers and what buyers are willing to pay. For example, recent buyers of the latest ASIC miners such as the Antminer S19J Pro from Bitmain are prepared to part with $15 per TH or less. Most sellers are asking $20 per TH.

Grayscale Investments, affiliated with Foundry, launched a structure to invest in mining equipment at “significantly reduced prices” during the crypto winter.

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