Bitcoin Mining Difficulty Drops 9.1%, the Biggest Cut Since June

Bitcoin's mining difficulty fell 9.13% to 134.82 T on November 14. It is the biggest downward adjustment since June.

Why it matters

A drop this large means a noticeable share of miners have switched off their machines. Bitcoin's price fell from about $80,000 in early November to below $70,000, so older and less efficient machines stopped paying for their electricity.

For miners who stay on, the cut is good news. Each of them now earns more bitcoin for the same amount of work. That lowers the cost of mining one bitcoin and eases the pressure on miners to sell their coins to cover bills. Miners selling less is one less source of supply on the market.

How difficulty works

Difficulty is how hard it is to find the next block of transactions. The network resets it about every two weeks, every 2,016 blocks, so that a new block keeps arriving roughly every 10 minutes. When the computing power securing the network, the hashrate, falls, blocks start coming slower, and difficulty adjusts down to match.

The network's hashrate peaked in late October and has been falling since. Analysts watch this kind of miner stress with the Hash Ribbons indicator. In the past, the end of a miner shake-out has often come close to a market low, though it is not a reliable timing signal.