1. Home
  2. Hash rate

Hash rate

Bitcoin on-chain data shows miners offloading BTC as revenues shrink

Bitcoin miners have been selling BTC since the start of June, potentially adding further pressure to the BTC price.

Bitcoin’s on-chain data provides evidence that Bitcoin miners are offloading their holdings. The factors influencing the selling pressure could be reduced earnings from a cooldown in Ordinals activity as well as mining difficulty and hash rate reaching an all-time high. 

According to on-chain analytics firm Glassnode, “Miners have been sending a significant amount of coins to exchanges.”

Glassnode data shows Bitcoin (BTC) miners’ inflows to exchanges spiked to a three-year high on June 3 to levels last seen during the bull market of early 2021.

Coin Metrics data also shows a decline in the one-hop supply metric of miners, which measures the quantity of Bitcoin stored in addresses that receive coins from mining pools.

The metric recorded a consistent uptrend in miner holdings since May 2023; however, the miners reversed their accumulation trend in the second week of June.

One-hop supply of Bitcoin miners. Source: Coin Metrics

Increase in mining difficulty and reduced Ordinals activity

Bitcoin mining difficulty, which refers to a measure of how difficult it is to find a new block in the Bitcoin blockchain network, reached an all-time high at the start of June.

Bitcoin difficulty adjusts periodically to ensure that new blocks are added to the blockchain approximately every 10 minutes on average. When the network’s computation capacity increases, it readjusts to make mining more difficult and vice versa.

The difficulty is adjusted every 2,016 blocks, which is roughly every two weeks, and is based on the total computational power, or hash rate, of the network. The last adjustment occurred on May 31, with a 3.39% increase in total difficulty.

Bitcoin mining difficulty. Source: Blockchain.com

The increase in Bitcoin difficulty reduces the earnings of miners, eating into their profitability and possibly increasing their losses.

Moreover, the competition among miners has increased since the last difficulty adjustment, with the network’s hash rate rising to a new all-time high of 381 exahashes per second on June 11. The next difficulty adjustment due this week will likely add to the selling pressure.

Bitcoin Ordinals activity, which was responsible for an increase in miner revenue, declined in May, leading to reduced earnings for miners. The total fees paid for Ordinal inscriptions on Bitcoin dropped to a two-month low, with trading volumes on nonfungible token marketplaces showing a similar trend.

The seven-day average earnings of miners, according to Glassnode data, dropped from a high of $33.9 million in May to $25.8 million at the start of June.

The 7-day moving average of Bitcoin miner revenue (orange) and BTC's price (black). Source: Glassnode

June also marked the start of summer, with hot temperatures in the Northern Hemisphere putting a significant load on some mining farms due to the increased cost of electricity.

In 2022, the summer heat waves caused miners in Texas to temporarily shut down operations. Reportedly, Texas accounts for around 15% of the mining capacity in the United States.

The heat waves could worsen in 2023, leading to a downturn in the network’s mining hash rate.

Related: Bitcoin miners have earned $50B from BTC block rewards, fees since 2010

Identifying miners’ stress levels

Currently, the cost of producing Bitcoin for the existing mining hardware lies between $35,532 and $21,244. With Bitcoin’s price holding above $25,000, the downtrend in Bitcoin’s mining hash rate could be limited.

However, if the situation worsens over the summer and the mining cost increases without a proportionate increase in the BTC price, the industry could fall back into capitulation mode, marked by accelerated BTC selling and a reduced network hash rate.

Bitcoin price chart with production cost indicator. Source: TradingView

Moreover, while Bitcoin’s hash rate has continued to rise, Bitcoin’s hash price metric — the market value assigned per unit of hashing power — declined significantly in May, suggesting a cooldown in demand for mining hardware.

According to an update from Hashrate Index, the “hashprice [PH] is back below $70.00/PH/day for the first time since mid-March” after touching an average of $82.23 per PH per day in May, a 14.8% decline.

It remains to be seen how far the sell-off extends and whether or not Bitcoin Ordinals activity comes back in the meantime.

This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.

This article is for general information purposes and is not intended to be and should not be taken as legal or investment advice. The views, thoughts, and opinions expressed here are the author’s alone and do not necessarily reflect or represent the views and opinions of Cointelegraph.

Hong Kong launches initiative to help banks with DLT adoption

Bitcoin mining firms keep building despite BTC mining profitability slump

Crypto mining firm CleanSpark has been aggressively expanding its fleet of mining machines this year, despite mining profitability being far from its all-time highs.

Despite a 44% decline in Bitcoin (BTC) mining profitability over the last year, some Bitcoin mining companies have continued to build and increase production, according to recent announcements.

On June 1, American Bitcoin mining firm CleanSpark announced that it had purchased 12,500 brand-new Antminer S19 XP units for $40.5 million. The deal worked out at $23 per terahash per second (TH/s), which is lower than the average market price.

The news comes as Bitcoin mining difficulty reached an all-time high of over 50 trillion on June 1, putting further pressure on miners. The network hash rate was also near its peak level at 395 EH/s on May 30.

CleanSpark’s purchase agreement stipulated that 6,000 machines are scheduled to be shipped by the manufacturer in June, and the remainder will be shipped in August.

Antminer S19 XP units have a hash rate of 141 TH/s, with the combined purchase providing an additional total hash rate of 1.76 exahashes per second to its current 6.7 EH/s. Zach Bradford, CEO of CleanSpark, said:

“This purchase ensures that we are prepared to meet and potentially exceed our year-end target of 16 EH/s.”

CleanSpark’s mining farms are located in Georgia. According to its website, the firm has 67,700 mining machines in operation and has mined 2,395 BTC year-to-date.

Bitcoin Hashprice over the past year. Source: Hashrate Index

The company has continued its expansion despite declining Bitcoin mining profitability, which has declined to $0.071 per TH/s per day, down 44% over the past 12 months and 82% since the crypto market peak in late 2021, according to Hashrate Index.

In February, CleanSpark purchased 20,000 brand-new Antminer S19j Pro+ units and in April it added 45,000 S19 XP ASIC rigs to its fleet.

Related: Mining difficulty passes 50 trillion — 5 things to know in Bitcoin this week

In other recent company updates, Bitfarms announced that it had mined 459 BTC in May, increasing production by 6.5% year-on-year. “A 47% year-over-year increase in our hash rate was offset by a 65% increase in network difficulty in the same period,” said Chief Mining Officer Ben Gagnon.

Cipher Mining announced a record production in May with 493 BTC mined. The increases were due to the transaction fee spike during the BRC-20 memecoin minting craze that peaked in early May.

On May 31, Compass Mining inked a deal with hosting provider Arthur Mining to open a new facility in Ohio.

Magazine: Bitcoin is on a collision course with ‘Net Zero’ promises

Hong Kong launches initiative to help banks with DLT adoption

Bitcoin metrics to the moon: ATH for hash rate, daily transactions and Ordinals

While the Bitcoin hash rate briefly touches new highs, Bitcoin Ordinals contribute to daily transactions exceeding 500,000.

A lot of Bitcoin (BTC) miners just came online. The Bitcoin hash rate, or the total computing power of the Bitcoin blockchain, just soared to 439 exahashes per second (EH/s). Moreover, the number of transactions processed on the Bitcoin blockchain in one day exceeded 682,000, with over 300,000 Ordinals inscribed. 

The hashrate, in orange, soars to 439 EH/s. Source: timechainstats.

These milestones demonstrate the network's strength and stability, as well as the increasing adoption of Bitcoin for various use cases, all while the banking sector in the United States fractures.

The Bitcoin hash rate, a measure of the computational power dedicated to securing the blockchain, has reached an all-time high, signifying increased confidence in the network's security. The hash rate is a crucial indicator of the network's health, as a higher hash rate means more miners are participating, thus making the network more resistant to attacks.

The surge in hash rate reflects growing investments in mining infrastructure despite fluctuations in the price of Bitcoin. More and more territories and regions around the world are mining Bitcoin, with increasing amounts of renewable energy, allaying fears of centralization or environmental impacts that have shrouded Bitcoin mining in the past.

However, as Denver Bitcoin, a well-known Bitcoin miner with Upstream Data Inc, points out, the hash rate surge may be short-lived. It’s important to “Watch 1500-block to 5k-block avg time to get an understanding of true hashrate,” he shared in a tweet:

The hash rate may be temporarily surging–partly driven by a resurgence in the popularity of Bitcoin ordinal inscriptions. Bitcoin ordinals are unique, non-fungible tokens (NFTs) built on the Bitcoin network, each representing a distinct position in the Bitcoin blockchain. Each ordinal is “inscribed” on a Satoshi (the smallest denomination of a Bitcoin), and owners can prove digital ownership of their Sat.

Ordinals have gained traction among collectors, investors, and enthusiasts, offering a new way to engage with the Bitcoin ecosystem. Bitcoin ordinals fan Dan Held, for example, shares that altcoin advocates engage with Bitcoin for the first time due to their creation.

Ordinals reach 3 million.Source: Dune

The number of inscriptions in a 24-hour period exceeded 350,000 on May 1, as the total number of ordinals exceeded 3 million. Given that each ordinal inscription also counts as a transaction, the number of Bitcoin transactions has also soared.

Daily transactions reach 682,000. Source: timechainstats

As more people buy, sell, and trade Bitcoin ordinals, the number of daily transactions on the network has significantly increased to 682,000. The mempool, or the "waiting area" for incoming transactions before they are confirmed, is currently very busy. The cheapest transaction fee sits at 8 sat/vB, or about $0.30–way above its lows of 1 sat/vB. If users are looking to send money to wallets on the Bitcoin base chain, the costs are significantly higher than usual due to the surging number of ordinal inscriptions.

Related: ​​Bitcoin Ordinals community debates fix after inscription validation bug

For some, Bitcoin ordinals offer another role for the network that goes above its activities as a store of value and medium of exchange. For others, such as Dr. Adam Back, number 76 on Cointelegraph’s Top 100, ordinals are useless.

Cointelegraph Magazine: Bitcoin in Senegal: Why is this African country using BTC?

Hong Kong launches initiative to help banks with DLT adoption

Bitcoin Miners Contend With Fifth Network Difficulty Increase of 2023

Bitcoin Miners Contend With Fifth Network Difficulty Increase of 2023Bitcoin miners are contending with the fifth network difficulty increase since February 24, 2023, following a 1.72% rise on April 20 at block height 786,240. The network’s difficulty now stands at 48.71 trillion, marking a 22.62% increase over the last 55 days since block height 778,176. Bitcoin’s Difficulty Has Risen More Than 22% Since Block […]

Hong Kong launches initiative to help banks with DLT adoption

Forget BTC price: The Bitcoin mining boom is quietly going parabolic

Bitcoin difficulty and hash rate stop at nothing in their quest to surge to new levels never seen before.

Bitcoin (BTC) may be struggling at $30,000, but under the hood, all-time highs of a different kind keep coming.

The latest data shows that Bitcoin network fundamentals — difficulty and hash rate — will hit new records this week.

Bitcoin mining difficulty, hash rate refuse to slow down

Bitcoin’s 2023 recovery has been about more than just BTC price action, with miners seeing a significant turnaround of their own.

As BTC/USD added 70% in Q1 alone, pressured mining participants saw some much-needed relief after the bear market squeezed profit margins to practically zero.

The comeback for miners is evident in difficulty, which among other things, reflects competition for block subsidies.

This has made new all-time highs for the past two months, and this week will be no exception. According to data from BTC.com, the difficulty will increase by approximately 2.1% on April 20, reaching 48.91 trillion.

The dizzying tally is a full 13 trillion higher than at the start of the year alone.

Bitcoin network fundamentals overview (screenshot). Source: BTC.com

Additionally, Bitcoin network hash rate is also estimated to be higher than ever, with raw data from MiningPoolStats etching a new all-time high of 418 exahashes per second (EH/s) on April 18.

Bitcoin hash rate raw data (screenshot). Source: MiningPoolStats

As Cointelegraph reported earlier this week, hash rate estimates are far from concrete and can be misleading, with calls now surfacing to reevaluate how it is measured and reported by those seeking to make bullish conclusions about BTC price strength.

However, as the old adage goes, “price follows hash rate,” and some commentators continue to watch the metric keenly as it drifts ever higher.

A key focus is Russia, stepping up mining activity over the past year to reportedly become the world’s second-largest miner in 2023, according to a report in Russian-language news outlet Kommersant.

While this has led to concerns that governments with a majority hash rate share could pressure miners to censor transactions, others believe that the real “danger” is using that hash rate for its intended purpose — earning Bitcoin.

“Adversaries hypothetically using hashrate to censor #btc transactions is a distraction from adversaries actually using hashrate to earn #btc revenue,” Pierre Rochard, vice president of research at Riot Platforms, wrote in part of a recent commentary on the topic.

Bitcoin miners not yet hoarding BTC

A look at the current state of miner balances meanwhile shows that on a rolling 30-day basis, BTC sales are increasing.

Related: What is Bitcoin hash rate and why does it matter?

On April 18, miners decreased their Bitcoin holdings by 648 BTC compared with one month ago, according to data from Glassnode.

The changes are significant compared with sell-offs that accompanied the FTX implosion in Q4 last year.

Bitcoin miner net position change chart. Source: Glassnode

Magazine: Why join a blockchain gaming guild? Fun, profit and create better games

This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.

Hong Kong launches initiative to help banks with DLT adoption

BTC price heading under $30K? 5 things to know in Bitcoin this week

Bitcoin faces a battle for key BTC price support to start the week, while market participants stay optimistic about trend continuation.

Bitcoin (BTC) starts a new week under $30,000 as analysts’ predictions of a short-term support retest come true.

The largest cryptocurrency saw a classic dive following its latest weekly close as the latest gains evaporated, but will they return?

Ahead of a fairly innocuous week for macro data releases, catalysts are likely to come elsewhere as BTC price action decides on a key support zone.

Much is at stake for traders, as the week prior offered the opportunity to reinvestigate altcoins as Bitcoin itself cooled its upside. With a retracement now in effect, attention will be on whether those altcoins can hold at their own higher levels.

Under the hood, it appears to be business as usual for Bitcoin, with network fundamentals already at or near all-time highs, showing no definitive signs of a comedown this week.

It may be too early to determine how price performance will impact hodlers, but the temptation to sell at ten-month highs must be clear — the percentage of the overall BTC supply now in profit is at an impressive 75%.

Cointelegraph takes a look at these factors and more in the weekly rundown of potential Bitcoin price triggers.

BTC price: $30,000 hangs in the balance

After a “boring” weekend for BTC price action, volatility returned in classic style at the April 16 weekly close.

With it came a return to $30,000 for BTC/USD, this marking its first major support retest since hitting ten-month highs above $31,000 last week.

Traders and analysts had widely predicted the move, arguing that it would constitute a healthy retracement to prepare for continuation of the uptrend.

Cointelegraph contributor Michaël van de Poppe, founder and CEO of trading firm Eight, was among those eyeing a buy-in just below $30,000, but kept his options open in the case of a deeper correction.

“Bitcoin is getting towards the long areas. Back towards the range low, through which a sweep can be granted as an entry point towards $32K,” he told Twitter followers.

“$28,600 could also be a long entry, but then I think we won't be starting to make new highs, for now.”
BTC/USD annotated chart. Source: Michaël van de Poppe/ Twitter

Analytics resource Skew noted how the dip had played out on exchanges, noting a “clean divergence” between spot sellers and derivatives traders.

“This is exactly the BTC retest I was talking about,” popular trader and analyst Rekt Capital meanwhile continued, striking an optimistic note.

“$BTC is currently successfully retesting the top of the Bull Flag price broke out from a few days ago. Hold here would be a good contributing sign for continuation.”

An accompanying chart showed BTC/USD close to resting on an important trend line on daily timeframes.

BTC/USD annotated chart. Source: Rekt Capital/ Twitter

A more cautious Daan Crypto Trades nonetheless flagged a tug-of-war between bulls and those simply trading the current range.

“Bitcoin Range Traders having the time of their lives while breakout traders are getting trapped on these range deviations/wicks,” part of commentary stated on the day.

“Likely to keep ranging until one side gives up.”
BTC/USD annotated chart. Source: Daan Crypto Trades/ Twitter

Earnings dominate macro debate

After a key week of macroeconomic data releases, the coming days are set to offer risk asset traders some comparative respite.

United States jobless claims and manufacturing figures will come toward the end of the week, but the macro focus will be elsewhere — specifically on earnings.

These are due, among others, from heavyweights Tesla and Netflix, as well as a slew of banks — all keenly watched by market participants in the wake of recent events.

“Earnings season is officially here,” financial commentary resource The Kobeissi Letter summarized.

Last week, Tedtalksmacro, a financial commentator also focusing on crypto, summed up the current environment as highly favorable to continued Bitcoin upside.

“Price breaking bear market structure, macro data trending favourably, momentum oscillators reset + USD liquidity higher than pre-tightening levels... Yet the majority continue to look for swing shorts to new lows,” he stated.

“~500 days of bear has created a strong recency bias…”

When it comes to stock markets themselves, however, the picture appears muddier — consensus among market participants is hard to ascertain.

Sven Henrich, CEO of NorthmanTrader, called for more proof of a breakout for the S&P 500 “bull market” narrative to become valid.

“Some day they will be correct, but in my view, based on history, a new bull market is not confirmed until $SPX moves above the monthly 20MA and SUSTAINS such a move, i.e. defends it as support,” part of a tweet read last week.

Henrich was considering a claim by Tom Lee, Managing Partner and the Head of Research at Fundstrat Global Advisors, who described bears as “trapped.”

“The other measure here is the weekly 100MA which is just above 4200. While developments have been technically bullish since the October lows markets are near these key resistance points with the $VIX on the floor of its multi year uptrend,” Henrich continued.

“Will recent liquidity injections, which have contributed to suppressed volatility, be enough to sustain a move above resistance as the economy is approaching a recession per the Fed staff? That's the big question I suppose everybody has to ask themselves.”
S&P 500 vs. VIX volatility index chart. Source: Sven Henrich/ Twitter

Bitcoin mining difficulty eyes fifth record-high in a row

In what is becoming a bi-weekly regular, Bitcoin network fundamentals are offering nothing but new all-time highs.

This week, difficulty is due to inch higher — currently by an estimated 0.45%, according to estimates from monitoring resource BTC.com.

Bitcoin network fundamentals overview (screenshot). Source: BTC.com

This will mark the fifth increase in a row, something which has not happened since February 2022.

Since the start of 2023 alone, over 4 trillion has been added to the difficulty tally, while hash rate is also continually setting new highs.

Raw data from MiningPoolStats recently estimated the latest all-time high as 413.4 exahashes per second (EH/s) on April 15. On Jan. 1, estimated hash rate was 285 EH/s.

Bitcoin hash rate raw data (screenshot). Source: MiningPoolStats

As Cointelegraph previously mentioned, however, hash rate changes in and of themselves may not be relevant as a yardstick for Bitcoin health if measured using exact figures.

As Jameson Lopp, co-founder and CTO of Casa, noted in a new blog post released the same date as the all-time high hash rate estimate, all may not be as it seems.

“Whenever you see someone claiming that a change in the network hashrate is newsworthy, you should always question the method and time range used to achieve the hashrate estimate,” he summarized after comparing various methods of hash rate estimation.

In Bitcoin, only old hands remain

As $30,000 appears and gets tested as support, the temptation to sell among those who weathered the 2022 bear market is increasing.

Mean on-chain transaction volumes have hit multi-month highs, according to data from analytics firm Glassnode.

Overall, more than three-quarters of the mined BTC supply is now in profit — the most in a year and arguably a clear incentive to take some of that profit off the table.

Analyzing market composition, Glassnode lead on-chain analyst Checkmate had some encouraging conclusions.

Long-term holders (LTHs) currently outnumber short-term holders (STHs) or speculators significantly, and the 2022 bear market sparked a shakeout which has left the market more resilient to price fluctuations.

“Nobody except the hardcore HODLers remains, nobody knows we're up 100% from the lows. They will probably only be back for real as we approach ATHs,” he predicted in part of a tweet this week.

Checkmate added that “Almost none of the folks who have been here for several months+, are spending right now.”

“They appear to require and demand higher prices before they sell. I certainly know do,” he wrote.

Crypto "greed" inches from November 2021 peak

Bitcoin may be far from its all-time highs of $69,000, but one metric rapidly homing in on repeating the climate of November 2021 is the Crypto Fear & Greed Index.

Related: What is the Crypto Fear and Greed Index?

The return to $30,000 was marked by a rapid increase in “greed” throughout the crypto market, its data shows.

As of April 17, Fear & Greed has a score of 69/100 — just 10% away from its 75/100 mark from when BTC/USD traded at its most recent peak.

Cointelegraph has often reported on the potentially overheated atmosphere within sentiment this year, and now nerves appear to be spreading.

“Now this isn't a metric I swear by as it is lagging, but it gives a good indication of when to look to de-risk and be cautious,” popular trader Crypto Tony reasoned about the Index over the weekend.

“The last time we came up to the 75 region was back on November 7th 2021 when Bitcoin was trading at over $65,000. Food for thought.”
Crypto Fear & Greed Index (screenshot). Source: Alternative.me

The views, thoughts and opinions expressed here are the authors’ alone and do not necessarily reflect or represent the views and opinions of Cointelegraph.

Hong Kong launches initiative to help banks with DLT adoption

Bitcoin Miner Bitdeer Technologies to List on Nasdaq via SPAC Deal

Bitcoin Miner Bitdeer Technologies to List on Nasdaq via SPAC DealAccording to a recent filing with the U.S. Securities and Exchange Commission (SEC), Bitdeer Technologies Holdings, a digital mining firm founded by crypto-billionaire Jihan Wu in 2018, plans to be listed on Nasdaq this Friday. The bitcoin mining firm is scheduled to go public through a special purpose acquisition company (SPAC) deal with Blue Safari […]

Hong Kong launches initiative to help banks with DLT adoption

Bitcoin hash rate spikes to 398 Exahashes — Analysts say miners coming back online

Analysts are speculating that the Bitcoin hash rate has seen a significant spike recently as miners come back online to reap the rewards of the BTC price hike.

Bitcoin's (BTC) hash rate spiked to all-time highs of 398 exahash on March 23, and analysts have been speculating miners are starting to turn their rigs back on as the Bitcoin price rises.

According to data aggregator YCharts the Bitcoin network hash rate has dropped to 344.63 as of March 27, an increase from 335.32 on March 26 but it is still up from 178.77 one year ago.

In a March 26 post, Sam Wouters, a research analyst at Bitcoin (BTC) financial service provider River Financial, speculated the spike in hash rate is connected to unused mining inventory coming online, new facilities going live, and entrepreneurs finding cheap sources of mining.

“While Bitcoin's price was so low and as much inventory as possible was brought online last year, at some point, maximum capacity of what the network could handle was reached," he said.

“Now that the price has been rising again and some time has passed, more of this inventory has been able to go online,” Wouters added.

In addition, Wouters says that Hydro models are starting to get into the market, and they have "250+ TH/s per machine, which adds tremendous hash rate."

A March 20 analysis from investment banking company Stifel shared a similar sentiment, speculating that the recent spike could be connected to miners bringing hardware back online.

"We anticipate overall network hash rate will continue to climb higher as a result of attractively priced hardware being bought up by well-capitalized miners."

Speaking to Cointelegraph, Nazar Khan from Bitcoin mining company TeraWulf, explained the company is currently maximizing the hash rate of all its rigs and has recently brought more online at its new Nautilus Cryptomine facility. 

"Wulf has the opportunity to add 80 MW of capacity at LMD and 50 MW at Nautilus. The recent price movement is an indication of the long-term value of the ability to expand at low-costt energy sites,” Khan said.

According to Khan, while some have speculated the lower prices forced miners to shut down their rigs and wait for the BTC price to improve, TeraWulf was able to continue ming bitcoin at lower price levels because of their lost cost from “efficient mining fleets."

Related: Crypto miner explains how Bitcoin mining stabilizes grids

However, regardless of the reason for the spike, Khan says TeraWulf is not expecting the network hash rate to continue to increase through the first half of the year irrespective of the BTC price.

"There is a lag between when investment decisions are made and that capacity comes online," Khan explained.

Magazine: Best and worst countries for crypto taxes — plus crypto tax tips

Hong Kong launches initiative to help banks with DLT adoption

Argo increases Bitcoin production despite BTC difficulty growth

Argo’s daily Bitcoin production rate in February surged 7% despite a 10% month-over-month increase in average network difficulty.

Publicly-listed Bitcoin (BTC) mining firm Argo Blockchain has increased its daily BTC production despite a significant spike in network difficulty.

During February, Argo mined 162 Bitcoin or BTC equivalents, translating to 5.7 BTC per day, which the firm announced in an operational update on March 7.

Argo’s daily Bitcoin production rate in February surged 7% from 5.4 BTC per day produced in January, despite a 10% month-over-month increase in average network difficulty.

Bitcoin mining difficulty is a measure defining how hard it is to mine a BTC block. A higher difficulty requires more hash rate or additional computing power to verify transactions and mine new coins.

According to data from Blockchain.com, BTC network difficulty surged to new all-time highs in February, hitting a difficulty rate of 43 trillion on Feb. 25.

Bitcoin difficulty historical chart. Source: Blockchain.com

The news comes amid the industry anticipating the next Bitcoin difficulty adjustment expected to occur on March 10. According to data from BTC.com, the next difficulty is estimated to reach 43.4 trillion.

Related: Argo Blockchain accused of misleading investors in class-action lawsuit

As previously reported, Argo Blockchain sold its flagship mining facility Helios to Mike Novogratz’s crypto investment firm Galaxy Digital amid the tough crypto market of 2022. Despite continuing to mine using Galaxy’s facility, Argo saw its BTC production drop after the sale. Months before the transaction, Argo’s monthly BTC mining generated more than 200 BTC.

Argo is not the only mining firm that seems unaffected by the BTC difficulty spike in February, with other miners like Cipher Mining producing 16% more Bitcoin over January. Marathon Digital also increased its average daily Bitcoin produced by 10% compared to January.

Hong Kong launches initiative to help banks with DLT adoption

You don’t see that every day: Bitcoin empty block found

Don't be fooled by its emptiness: Block 776,339 plays as important a role as busier blocks in the Bitcoin blockchain.

Bitcoin (BTC) is known for its robustness, security and predictability. Every 10 minutes–on average–the blockchain produces a new block and the successful miner earns a block reward of 6.25 BTC, circa $130,000. 

However, every once in a while, the Bitcoin blockchain surprises observers and participants.

At block height 776,339, nodes across the network verified a completely empty block. The block was added to the Bitcoin blockchain with zero included transactions–leading to some confusion among the crypto community. So, what exactly is an empty block, and how does it happen?

Block expectation vs reality according to source: mempool.space

First, while an empty block might seem strange at first, it's actually a normal occurrence on the network. The last time it occurred was little over two weeks ago, in block 774486.

Miners are incentivized to mine blocks as quickly as possible, and sometimes they will mine a block before they have received any transactions to include. When this happens, the block remains empty.

The Bitcoin mempool, the go-to space for analysing the Bitcoin blockchain offers the following explanation: “When a new block is found, mining pools send miners a block template with no transactions so they can start searching for the next block as soon as possible. They send a block template full of transactions right afterward, but a full block template is a bigger data transfer and takes slightly longer to reach miners.”

“In this intervening time, which is usually no more than 1-2 seconds, miners sometimes get lucky and find a new block using the empty block template.”

In essence, the miners “got lucky” by mining a template. In this instance, the Bitcoin block at height 776,389 was added mere seconds after its predecessor, 776,488. ‎However, Block 776,388 earned an extra 0.086 BTC or circa $1,854 in fees, which was added to the block reward of ‎6.25 BTC or circa $135,247.

Even though an empty block doesn't contain any transactions, the miner still receives the block reward of newly minted bitcoins. As such, Block 776,389 was awarded 6.25 BTC; no transaction fees. Binance Pool was the winning miner, who contribute as much as 12% to t total hash rate.

Bitcoin mining pool ranking. Source: mempool.space

It's important to note that empty blocks are not a problem for the network. By mining empty blocks, miners still produce the coin generation transaction, also known as the coinbase transaction, which keeps Bitcoin steady on its path to reaching 21 million Bitcoin issued. 

Related: Public miners increased Bitcoin production, hash rate in January

According to data from BitInfoCharts, the percentage of empty blocks on the network is usually around 1-2%. The stat is more surprising today given the rise of “ordinals” on Bitcoin, or the ability to permanently etch pictures, data and stamps onto the blockchain.

The rise in ordinals has provoked some questions and even concern among the Bitcoin community, and the first instances of pornography were recently recorded. The mempool has been increasingly busy and block space has been contested for as some jpeg enthusiasts scramble to contribute their art to the Bitcoin blockchain.

Hong Kong launches initiative to help banks with DLT adoption