Bitcoin mining difficulty drops 11% in largest negative adjustment since China’s 2021 ban

Bitcoin's mining difficulty experienced an 11.16% negative adjustment, reaching 125.86 trillion, marking the largest single drop since the major mining ban in China in July 2021. This adjustment followed block times drifting above the 10-minute target, caused by a roughly 20% reduction in the network's total hashrate over the past month. The hashrate drawdown is attributed to two main factors: a significant collapse in Bitcoin's price (over 45% from its October high, falling near $60,000) fueled by high Treasury yields and ETF outflows, and operational curtailments by miners in U.S. power regions due to Winter Storm Fern. This environment has severely impacted miner profitability, with hashprice hitting all-time lows and the average cost to mine one bitcoin ($87,000) exceeding the spot price (near $69,000). While the difficulty drop mechanically aids surviving miners by increasing their relative odds of earning rewards, the long-term relief depends on future BTC price movements. Some analysts view the hashrate drop as a potential contrarian bullish signal.

(Source：The Block)