Bitcoin (BTC) looks like its bear market low in 2018, And one of the basics is the repetition of a movement that has occurred only twice in its history.
Analysis of the difficulty of the Bitcoin network after its last adjustment on June 4th shows a significant resemblance to the situation where the BTC / USD pair was trading at USD 3,100 lows.
The difficulty of BTC
This week, The difficulty has been adjusted by 9.3%. This followed a downward change two weeks ago -6%.. If the next adjustment is also negative (currently forecast at -7%), only three consecutive negative adjustments have been made.
With the exception of December 2018, the only other time was the record of eight consecutive adjustments in 2011.
If the phenomenon repeats itself, it can be significant. The difficulty provides an estimate of the miners’ interest, and eliminating them will encourage participation in the validation of Bitcoin transactions.
Adjustments are also the key to securing Bitcoin’s status as “hard” money. Difficulty changes automatically happen every block mined in 2016, allowing Bitcoin to regulate itself predictably without compromising security.
Bitcoin hardship case chart with decline from 2018. Source: BTC.com
Bitcoin “works as planned”
The situation is complicated in 2020; Just a few weeks after Bitcoin’s third block subsidy was halved, miners’ incomes fell by 50%. As Cointelegraph reported, sales of the mining assemblies continued later; They sold more coins than they earned.
However, for the well-known commentator WhalePandaCurrent behavior shows that it is normal business for Bitcoin.
“3 weeks after halving #Bitcoin, the mempool is almost empty again, 1 confirmed the transaction saturation,” he tweeted last week.
“There is no death spiral in mining, although we have lost almost 50% of the hashes, it is recovering, the next adjustment difficulty is below 10%. Bitcoin is working as planned.”
Less difficulty should further increase the hash rate as miners increase their engagement. The hash rate has risen since it halved, and a widespread theory suggests that price promotions follow increases in the hash rate.
Three months after the lows in December 2018, BTC / USD started an increase reaching almost $ 14,000.
Last year, a new metric indicated that Bitcoin should reach 1,000% of its lowest level of difficulty in 2018.
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