Bitcoin is Limped by Mining Difficulty! Thanks to the Greedy Miners

Bitcoin mining difficulty has sabotaged investors amid the declining value of the crypto

Bitcoin has dropped below US$30,000 as the crypto market struggles to regain its uptrend momentum. With global crypto investors in a turmoil, who are not only suppressed by the declining value of the cryptocurrency market but also due to several economic and financial changes in the global market, in no time they will start looking for more centralized and traditional forms of assets for support and store of value. As the broader market is in turmoil, the Bitcoin price is challenged as its experts believe that the crypto will experience a further drop in its value in the upcoming months, after it hit a 20% low earlier in May 2022. Amid this volatility in its value, the Bitcoin price continues to witness a struggle in its dominance due to the miners' greed. According to reports, in April 2022, Bitcoin mining difficulty reached its all-time high, causing numerous glitches in its network. It is quite evident that miners have become exceptionally greedy and they have unfortunately sabotaged themselves and the crypto's investors along with them.

According to reports, currently, Bitcoin has reached almost two-thirds of its 366th difficulty epoch. Even though the price of Bitcoin is slumped and its value has crashed by a landslide as compared to its all-time high back in November 2021, there has been a growing competition among miners since the beginning of 2022, which reached an all-time high in April. To get more specific, reports have revealed that Bitcoin mining difficulty was quite prominent on March 28, which was around 27 trillion compared to 13 trillion at the end of 2021, indicating a rise of 13.6%. The more miners jump into the network, the more challenging and energy-intensive, Bitcoin mining becomes. Basically, mining difficulty is used by digital assets to keep the average time between blocks stable as the network's hash power changes. But now, it has become a headache, both for the developers and miners.

The Rise of Bitcoin Mining Difficulty

With the growing mining difficulty, the costs of running operations will multiple. Then to alleviate this problem, miners will experiment with different methods. Some of these methods might make it even more difficult for investors and developers to resolve the existing issues and further, bring down its value. Presently, Bitcoin's user base has declined within a matter of a few months and lacks evidence of strong growth or recovery. The transaction count is also relatively low currently but is higher than last July. Nevertheless, the market momentum is still quite far from July 2021 which is making investors even more anxious about the future of Bitcoin. The BTC transaction fees had hit all-time lows around May 2021, indicating a lack of competition for block space among Bitcoin traders. But as of May 2022, Bitcoin's reputation is slaughtered from almost all sides. Competition among Bitcoin miners is on the rise even though they are earning fewer profits per block.

Did Bitcoin miners sabotage investors' wealth and profits?

Well, they kind of did, but the incidences were unintentional. Bitcoin adoption has considerably grown over the past couple of years, hence, it is quite considerable why everybody would want to grab their shares of profits from this popular cryptocurrency. Bitcoin mining is also quite profitable. It is a highly concentrated business, yielding millions of dollars of profits. But now as Bitcoin mining difficulty increases, several of these miners are leaving the network and moving towards more profitable options like Ethereum. Even though analysts speculate that this might bring down the heat from Bitcoin's network, it is not likely that the crypto will regain its past relevance anytime soon.