Difficulty in mining Bitcoin It fell 16 percent on Sunday to $ 21 trillion, the biggest drop this year. The correction indicates that Chinese miners are shutting down some machines before more stringent government measures on mining.
Bitcoin mining difficulty measures the amount of computer power needed to produce new Bitcoins. The network adjusts the difficulty (roughly) once every fifteen days to reflect the level of competition among miners. Lower mining difficulty indicates less competition.
More than 75% of miners verify bitcoin transactions in China. Last Friday, the government added bitcoin mining to its list of industries that require monitoring to protect the economy.
Shortly thereafter, Huobi and OKEx restricted Chinese customers’ access to certain services. A Hubei spokesperson told Decrypt the restrictions were in response to the government’s comments. OKEx told Decrypt that its restrictions are aimed at staying in compliance with the regulatory agencies.
Government sources have reportedly told the Chinese newspaper Caixin that the government is concerned that cryptocurrencies may harm investors and that it prefers to use electricity and computer chips elsewhere.
Inner Mongolia has already begun to crack down on measures. The autonomous government in the region is considering adding bitcoin miners to social credit blacklists and has proposed revoking telecommunications licenses for miners.
Today’s adjustment also increased the average time to produce a block to 11 minutes 55 seconds – nearly four minutes longer than May 13, when the average mass yield was 8 minutes 14 seconds.
In the previous adjustment, on May 13th, mining difficulty reached a record high when it increased by 21.53% in relation to the difficulty levels set on May 1.