The Bitcoin crash that took the price of the world’s largest cryptocurrency down to $3k has been a game-changer for Bitcoin miners everywhere. In fact, many miners quit the network as the mining became unprofitable due to reduced prices, thus impacting the hash rate and block production.
A readjustment in difficulty was necessary to bring the operations back to normal in the Bitcoin ecosystem. On 25 March, Bitcoin’s difficulty readjustment led to a drop in difficulty by 15.95%.
According to Ankit Chpilunkar, a researcher at Token Analyst, this ~16% drop was noted to correct increased block times. The block times have thus, dropped by 35%, returning to its normal level of 9.75 mins to 15.15 mins.
Source: Token Analyst
The delay in block production was a result of the slower mining of blocks. According to Glassnode, the mining of blocks had slowed down by 25%, with the time taken to produce one block reaching 2018 levels, a time when Bitcoin’s price had crashed after the high of December 2017. Chiplunkar also highlighted this via a tweet where he mentioned that on 25 March, there were three instances observed where the blocks were mined following an hour’s delay.
Source: Token Analyst
The expected rate of the difficulty drop was around 14%; however, the difficulty dropped by almost 16%, a development that would mean increased miners’ revenue. Data provided by Blockchain.com suggests that miners’ revenue was spiking until 17 February, recording a value of $19.82 million.
However, as the disturbance in the Bitcoin market got worse, the revenue noted a drop. Despite BTC’s terrible fall on 12 March, data suggested that the revenue had taken a nosedive in two installments. The first fall took place between 7 March and 11 March, a time period during which the revenue fell from $18.20 million to $11.90 million.
Following this, there was a spike on 12 February, climbing to $13.54 million. However, it soon slipped to $8.63 million on 13 February.
The last recorded data on Blockchain.com suggested that the revenue had fallen further to $8.11 million; however, as the difficulty was re-adjusted on 25 March and as the price of Bitcoin stabilizes, the revenue earned by miners will also notice a positive change soon enough.
