• Sat. May 21st, 2022

Bitcoin’s network operating difficulty (7d moving average) hits new high

Since early December 2020, Bitcoin has been on a formidable bull run. From its valuation on December 1, Bitcoin is up almost 90%. The growth percentage was much higher yesterday, however, especially as corrections have multiplied over the past 24 hours.

Despite Bitcoin’s price drop on the charts, the cryptocurrency still managed to maintain its position above the key price point of $ 30,000, with BTC holding a price at press time of $ 31,620. .

Source: Glass knot

In what is yet another strong point for the ecosystem, according to data provided by Glassnode, Bitcoin’s network difficulty has set a new all-time high. Looking at the 7-day Average Network Difficulty chart provided by the cryptoanalysis platform, it can be seen that BTC’s network exploration difficulty (7-day moving average) has reached a new high in the charts. .

Source: Blockchain.com

For Bitcoin, the miner demographics are a key group that helps maintain the valuation of the centerpiece. When the miners hold, the price tends to remain stable and even increase. However, the data on the incomes of miners seems to paint a less than ideal picture.

Miners’ incomes over the past few weeks, even when Bitcoin was breaking new price records, have fallen dramatically. According to data from the Bitcoin network, miners’ income stood at $ 45.2 million on January 6. However, it had fallen to just over $ 30 million at the time of publication. This could force small scale miners to sell some of their BTC and such a move tends to negatively impact the overall trading price of the coin.

Bitcoin’s mining difficulty and the margins by which it has increased has also been a polarizing and interesting topic on crypto-Twitter. Crypto-analyst PlanB, known for its Stock-to-Flow model of Bitcoin prediction, recently pointed out that since 2019, mining difficulties have remained stable, compared to the sharp rise in the coin’s price.

However, PlanB’s comment was quick to catch the attention of Glassnode’s CTO – Rafael Schultze-Kraft – who pointed out that in 2020 alone, the difficulty of the network has increased by 50%.

About 2 weeks ago, Bitcoin had undergone a difficulty adjustment, which saw the network difficulty increase by over 11%. Combined with lower rewards for network miners and increased computing power to keep the network and keep it safe, it seemed to have become an additional burden on BTC miners.

However, this is not the case for the moment. CryptoQuant’s Miners Position Index (MPI) data indicates whether or not sales have started from BTC miners. A value greater than 2 is usually problematic as it indicates that miners are unloading their parts to maintain their sustainable operations. At the time of going to press, BTC’s MPI was around 0.6 and pointed out that the hodling sentiment continues.

Source: CryptoQuant

The fact that miners do not sell their BTC holds promise for the coin’s price aspirations and will require the support of the hodlers, if he is to revisit its valuation of $ 40,000 in the coming weeks.

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