This year will be the most dramatic you can remember, and for many reasons. Although the price of It has been hit by the recent financial crisis and its hashrate is recovering quickly, indicating that the mining industry has not yet given up on the world’s top cryptocurrency.
The difficulty of the Bitcoin network, one of Satoshi Nakamoto’s championships, is increasing again in response to the increasing competition among miners. In fact, the difficulty is back to the level where the price was above $ 8,000.
Miners are still interested in Bitcoin despite the recent volatility
If you’ve checked Bitcoin’s price today for the first time after ignoring it since the beginning of this year, you’re sure to think that 2020 was uneventful. The leading cryptocurrency is currently trading at just under $ 7,300 after the year started at an approximate value of $ 7,230.
Anyone who follows the industry and current affairs will know that exactly the opposite has happened. After experiencing steady growth in the first month and a half of the year, the coronavirus pandemic and the panic triggered by the collapse of an OPEC-Russia oil price support deal, he saw Bitcoin price in some cases reduced exchange from a maximum of USD 10,400 to less than USD 4,000. This dramatic breakdown occurred in just a month, and most of the fall occurred in a few hours in March.
As BeInCrypto recently reported, the sharp drop in prices not only frightened investors, but also led to a decline in the network hashrate. Because bitcoin mining relies on large amounts of electricity, the cost-effectiveness of implementing hash electricity in the network is relative to the price of bitcoin itself. As miners shut down their machines at lower prices, the difficulty of mining a new block also decreased .
Investors have returned since the massive drop in prices. Since the price has risen above its opening value this year, the miners have also returned. Industry observers from the Altana Digital Currency Fund and CIO Alistair Milne point this out below Tweet that the difficulty is increasing again in the Bitcoin network:
Bitcoin difficulty increased + 5.7% yesterday
… Back to the levels last seen when the price was> 8000 USD pic.twitter.com/xhduq0K2FR
– Alistair Milne (@alistairmilne) April 9, 2020
As Milne has already mentioned, the difficulty of the network is back to a level that was last seen at prices above $ 8,000. The drop below $ 4,000 was clearly not enough to permanently shift the mining industry.
Prices are rising at the gates of Bitcoin Halving
Although recent global events have triggered a continuing feeling of fear among investors, price and hashrate are on the up again. The driving force behind this growth is a likely expectation of the next halving.
Many analysts believe that the sudden shock of Bitcoin supply that will occur next month will be a catalyst for higher prices. Some even plan to halve it as a breakthrough that will bring BTC to a new all-time high and much more.
Others argue that the current economic policies of central banks around the world are a strong foundation for the tight cryptocurrency. [National Review] The reason for this is that in a world with potentially infinite dollars, the price of Bitcoin has to be significantly higher.
While the exact cause of buying pressure is a question of speculation, there has been recent evidenceindicates that the halving has a strong impact on investor sentiment. The controversial cryptocurrency recovered relatively yesterday, just a few days before its own halving event. We’ll find out if this will apply to Bitcoin (BTC) in about a month.
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As a leading blockchain and fintech news company, BeInCrypto always strives to comply with strict editorial guidelines and the highest journalistic standards. With this in mind, we always encourage and encourage readers to do their own research into the information contained in this article. This article is intended as news and is for informational purposes only. The topic of the article and the information provided may have an impact on the value of a digital or cryptocurrency asset, but is never intended. Likewise, the content of the article and the information contained therein do not intend and do not intend to provide sufficient information for a financial or investment decision. This article is not expressly intended as financial advice, it is not financial advice and should not be construed as financial advice. The content and information in this article have not been prepared by a certified financial professional. All readers should always conduct their own due diligence with a certified financial professional before making an investment decision. The author of this article may have any amount of Bitcoin, cryptocurrencies, other digital currencies, or financial instruments at the time of writing, including but not limited to those listed in the content of this article.