Key Points
- Bitcoin mining difficulty has reached an all-time high in anticipation of the 2024 halving event.
- Miners are gearing up for the event, expecting a potential price surge for Bitcoin.
The mining difficulty on the Bitcoin (BTC) network has set a new record as miners prepare for the halving event due in 26 days.
The difficulty of Bitcoin mining represents the complexity of the puzzles that miners need to solve in the Proof of Work (PoW) system.
Understanding Bitcoin Mining Difficulty
Data from the Blockchain.com explorer indicates that the Bitcoin mining difficulty was at 83,947,913,181,362 as of the last adjustment on March 21. This highlights the continued growth of the network’s hashrate, despite brief downturns in mid-2021 and April 2022. These downturns were due to China’s crackdown on Bitcoin mining operations.
The increase in mining difficulty signifies active miner participation and growing optimism about a potential Bitcoin price surge. With the halving event just around the corner, miners are ramping up their efforts to accumulate as much Bitcoin as possible.
The spike in Bitcoin mining difficulty also mirrors the surge of new miners joining the network, pointing to increased interest in securing a share of the remaining unmined BTC.
Preparations for the Halving Event
Miners are extensively preparing for the upcoming halving event. The introduction of spot Bitcoin Exchange Traded Fund (ETF) products adds another layer of complexity. The reduction in miners’ revenue from 6.25 BTC per block to 3.125 BTC may initially slow down mining activity.
However, the expected supply shortage could potentially boost the long-term growth of Bitcoin’s value. The impending supply-demand shift is seen as a key driver for Bitcoin’s long-term price growth.
As the halving nears, some miners may struggle with the increasing mining difficulty and choose to exit the market. To manage electricity costs, mining companies are upgrading to more efficient technology and relocating old computers to Africa and South America.
According to Ethan Vera, the Chief Operating Officer at Luxor Technology in Seattle, an estimated 600,000 S19 series computers, which make up a majority of the current mining machines, are being moved out of the US, with Africa and South America as the primary destinations.
Price Predictions Post Halving Event
The impending Bitcoin halving is generating anticipation for a potential bull run, a trend often associated with this event in the past. As the halving event approaches, there is optimism among bulls that it could once again catalyze a significant rally in Bitcoin’s price.
Analysts have varying predictions, with some anticipating Bitcoin surpassing its previous all-time high of $73,000, while others suggest a potential retracement to around $50,000. Major ETF issuers may adjust their accumulation strategies based on evolving market conditions.
Robert Kiyosaki, the author of “Rich Dad Poor Dad”, predicts that BTC could reach $300,000 by the end of 2024. Bernstein, a leading research firm, has raised its Bitcoin price forecast from $80,000 to $90,000, predicting Bitcoin could reach $150,000 in 2025.
William Quigley, one of the co-founders of Tether, shared his bullish prediction for Bitcoin’s price on CNBC’s ‘Squawk on the Street’. He emphasized the increasing institutional and retail investment in the crypto market and forecasted that Bitcoin could reach a staggering $300,000.
