While Bitcoin (BTC) is struggling to reach and maintain $30,000, new highs are being reached beneath the surface.
New records for Difficulty and Hash Rate
Namely, the latest data shows that the basics of the Bitcoin network, difficulty and hash rate, will hit new all-time highs this week.
In 2023, Bitcoin’s recovery wasn’t just about BTC’s price action; miners themselves also saw significant improvements. The first quarter alone saw BTC/USD gain 70%, providing some much-needed relief to miners who saw profit margins plummet to near zero during the bear market.
The improvement for these crypto miners is reflected in competition for block grants, which has reached new all-time highs over the past 2 months. This week will be no exception. According to facts sourced from BTC.com, the difficulty will increase by about 2.1% on April 20 to 48.91 trillion, a staggering number that is a whopping 13 trillion higher than at the beginning of the year.
Estimates are somewhat misleading
Yesterday (on April 18), the Bitcoin network hash rate hit a new all-time high of 418 exahashes per second (EH/s), according to raw facts from Mining Pool Stats. While the hash rate estimates are not concrete and could be considered somewhat misleading, some commentators continue to closely monitor the metric as it is often used to draw conclusions about BTC price strength.
A major concern is Russia, which has reportedly ramped up their mining activities to become the second largest miner in the world by 2023. This has led some to fear that governments with a majority stake in the hash rate could pressure miners to censor transactions. However, others believe that the real “danger” is that the hash rate is being used to earn Bitcoin.
“Detractors who hypothetically use hash rate to censor #btc transactions distract from opponents who actually use hash rate to earn #btc revenue,” Pierre Rochard, vice president of research at Riot Platforms, wrote in a statement. recent commentary on the topic.
Number of BTC sales still continue to increase
A look at the current state of miner balances, meanwhile, shows that BTC sales are increasing on a 30-day rolling basis.
Finally, on April 18, miners reduced their Bitcoin holdings by 648 BTC compared to a month ago, according to facts sourced from Glassnode. It is not yet known whether this trend will continue or not.