Bitcoin Mining Difficulties and Challenges: How Companies are Adapting to the Bear Market

Bitcoin network recently calculated the difficulty of mining bitcoin every 2,016 blocks, based on the supply and demand of miners. companies such as compute north and core scientific have filed for bankruptcy, while others, such as argo, managed to avoid the same fate through end-of-year deals. marathon digital holdings, the second biggest mining firm in the world by market capitalization, has seen some of its operations come under scrutiny recently.

Difficulty of mining bitcoin was calculated roughly every two weeks in december of 2022. the hash rate, or the amount of attempts miners make to break the encryption code, is currently at 273.76 eh/s, indicating a strong and growing network. the cold front that swept through north america during the christmas season had an effect on the sector, causing a difficulty leap of over 10%. industrial electricity prices have ballooned 16% between 2021 and 2022, while the price of bitcoin has almost halved from this time last year.

Bitcoin network calculates the difficulty of mining bitcoin based on the supply and demand of miners. charles schumacher, vp of corporate communications at marathon digital holdings, attributed marathon’s resilience to negotiating contracts, paying for energy and the efficiency of their mining fleet. joe burnett, head analyst at blockware, noted that it can take years to build out mining infrastructure. harper stated that when a cold front swept through north america, some miners turned off due to operational issues and others curtailed their power draw to supply electricity back to the grid. despite the bear market, the current bitcoin price of around $23,000 has resulted in a lot of miners getting back into the game. the only way for bitcoin mining to no longer be profitable is if it were to hit zero.

By Evey Lovelace

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