Bitcoin Network Fundamentals Remain Strong Despite Price Drop: Mining Difficulty Hits New Highs
Summary:
Bitcoin network fundamentals show resilience as mining difficulty reaches new all-time highs and hash rate remains strong. Despite a 10% drop in BTC price, miners continue to operate profitably. Investors show confidence in the security and reliability of Bitcoin and Ethereum networks. The amount of BTC held by mining entities remains stable.
Bitcoin network fundamentals remain strong despite a bearish price action for BTC this week. On-chain data reveals that the mining difficulty has reached new all-time highs, closely followed by an impressive hash rate. Despite a 10% drop in BTC/USD last week, miners seem unaffected as the difficulty increased by 6.17% during the latest biweekly adjustment, marking the sixth-largest uptick in 2023. This suggests that miners are still profitable and not struggling. The next adjustment is expected to push the difficulty above 56 trillion for the first time. Similarly, the hash rate, which reflects the hashing deployment by miners, is challenging previous highs of over 400 exahashes per second. This data indicates a "high confidence" in the security and reliability of both Bitcoin and Ethereum networks, despite the recent price decline. The BTC and ETH networks are considered undervalued, presenting an opportunity for investors to accumulate assets. Data from Glassnode shows that the amount of BTC held by mining entities has seen minimal change, standing at just over 1.83 million BTC as of August 22.
Published At
8/23/2023 7:18:00 AM
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