Even if prices are wishy-washy, it appears as if Bitcoin (BTC) network is being bulwarked. More miners are entering as mining difficulty rise.
In 2019, Bitcoin has been recording new levels in both price and mining difficulty. Unfortunately, towards the end of last month, the price of Bitcoin lost its steam to towards the $10K mark. In contrast, the mining difficulty is on the rise and well observed by a keen Twitter user:
“Bitcoin mining difficulty has just hit an all-time high. The network is stronger than ever.”
Bitcoin mining difficulty has just hit an all-time high.
The network is stronger than ever.
— Kevin Rooke (@kerooke) May 31, 2019
On May 31, the Bitcoin mining difficulty rose by 11.26 percent to reach a new difficulty level of 7.46T from a previous difficulty of 7.45T. The increase in the mining difficulty was recorded in Token Insight’s report for the first quarter of 2019.
The report titled “Cryptocurrency Mining Industry Quarterly Report,” noted that:
“Difficulty adjustments during the first and second quarter of 2019 are to be expected. The last bull market period of BTC leads to a large remnant of hash power, which is impossible to be multiplied by the capacity of Samsung and TSMC chips. BTC mining has an average network hash rate of 45.76EH/s and a current difficulty of 6.39T, which is expected to exceed its previous record-high of 7.46T, corresponding to an average hash rate of 53.33 EH/s.”
The Hash Rate Will Increase By 50 Percent
Additionally, Token Insight anticipates that the mining hash rate would increase by between 30 and 50 percent by the end of the year.
The mining difficulty can roughly be an indication of increased activities by Bitcoin miners. Consequently, the BTC network may be considered more secure than before since there are more parties to validate transactions. The increase in miner activities on the BTC platform may be influenced by the rise in the price of Bitcoin since the year started. Towards the end of last year, miners were seen as turning off their rigs due to the falling prices.
Unfortunately, although the overall hash rate has increased, it does not indicate an increase in the number of miners. Neither does it suggest that those who had switched off their rigs are back online. Instead, at this point, there are many theories to support the increase in the hash rate hence the rise in mining difficulty.
A New ASIC Is in Use
One of those theories indicates a possibility that a new BTC mining ASIC with a higher hash rate has been deployed. Additionally, some Bitcoin mining pools have recorded an increase in hash rate. For instance, ViaBTC recorded a 50 percent increase in the hash rate.
Despite the increase in hash rate and mining difficulty, unconfirmed transactions are on the rise. At some point on May 31, these transactions reached 25 million. Therefore, those sending and or receiving BTC may wait a little while longer before their accounts are updated.
According to Token Insight:
“By conservative estimation, by the end of 2019, BTC mining hash rates could grow by 30 percent at most to 59EH/s with difficulties rising to 8.31T. In an optimistic estimate, by the end of 2019, BTC mining hash rate could grow by 50 percent at most to 68EH/s with difficulty rising to 9.59T.”