To reduce power demand in energy grids struggling with the heat wave in the USA, especially in Texas cryptocurrency with miners turning off their machines bitcoin Mining difficulty fell 5% on Thursday.
The Bitcoin mining difficulty is automatically adjusted every two weeks to keep the time required to mine a new block at roughly 10 minutes. As more computing power is connected to the network, the difficulty is set higher, and as recently, as computing power is pulled from the network, the difficulty is lowered.
Heat Wave in the USA Caused Bitcoin Miners to Shut Down Their Machines
According to data from the BTC.com mining pool, the difficulty level fell 5% on Thursday to its March level.
“The difficulty has eased as American miners have shut down their machines for significant periods of time over the past two weeks as electricity prices soared due to the heatwave,” said Jason Mellerud, senior researcher at Arcane Research.
Three Consecutive Falls Happened for the First Time Since Last Year
This is the third consecutive drop in mining difficulty, and the first since the three-time drop in a row happened a year ago when Chinese miners shut down their machines as the country banned BTC mining.
Mellerud continued:
“The first drop in hashrate in mid-June was most likely due to the drop in BTC price.
However, the second drop at the beginning of July was probably caused by miners cutting their power in response to high electricity prices.”
Some miners receive rewards when the demand for the grid increases to a certain level, as per their agreements, when they turn off their machines and release electricity to the grid.
*Not investment advice.