Bitcoin Mining Difficulty Approaches All-Time Highs, as Number of BTC Addresses with 1 or More Coins Keeps Rising

Mine Shaft Mining by Martin Brechtl on UnsplashBitcoin (BTC) mining difficulty, which aims to measure the amount of resources needed to compete for mining newly minted BTC, had increased by around 9% in the past 24 hours (at the time of writing). According to data from Glassnode, an on-chain market analysis provider, Bitcoin mining difficulty had only been around 4.4% below its all-time high.

As explained by Glassnode, the Bitcoin mining difficulty is the current estimated number of hashes needed to mine a block of BTC transactions. Bitcoin difficulty is usually denoted as “the relative difficulty with respect to the genesis block, which required approximately 2^32 hashes,” the data provider noted.

The Bitcoin price had recently reached a 2-year high of over $19,000 and then crashed to below $16,400, but mining difficulty continues to increase.

It’s worth noting that a surge in BTC mining difficulty had come shortly before the bull markets of 2013 and 2016. However, Bitcoin has not yet managed to break past its previous all-time high of nearly $20,000 back in December 2017. But the leading cryptocurrency did manage to get within 3% of its ATH price.

When the Bitcoin mining difficulty goes up, it can also lead to a significant increase in transaction fees and it can take longer to generate new blocks. An increase in mining difficulty can lead to a rise in the number of unmined transactions in Bitcoin’s mempool as well.

The fastest and cheapest BTC transaction fee is 60 satoshis/byte, according to data from Earn.com (at the time of writing). (Note: there are 100,000,000 satoshis in 1 Bitcoin.)

Going on to provide other crypto market updates, Glassnode noted that since the announcement from OKEx to resume withdrawals, they’ve seen “an outflow of 29,300 $BTC from the exchange.” During the same period around 21,600 BTC were deposited, “reducing the exchange’s balance to ~212k BTC.”

The number of Bitcoin “wholecoiner” addresses (those holding 1 BTC or more) on this day every year has also been steadily increasing, which indicates that many more people might be holding on to the digital asset as a long-term investment, hedge, or store of value (SoV).

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