Bitcoin (BTC) mining had been abruptly stopped by Chinese authorities not too long ago when the country’s government had decided to no longer allow crypto mining to take place within China. As such, nearly all mining activities and operations across several regions have since been shut down, as miners desperately try to leave the country so that they don’t have to face severe penalties and consequences. Crypto exchanges and investors are also under heavy supervision as the government tightens its grip on the crypto industry and is effectively banning everything related to cryptocurrencies.
As a result, finding and subsequently implementing new blocks onto Bitcoin’s blockchain network is slowly becoming much easier. In fact, BTC mining difficulty is expected to record a drop of 11.18%, as per the information from BTC.com.
The network had managed to log two negative adjustments, namely one on the 6th of June and the other on the 30th of May this year. The adjustments had been –5.30% and –15.97%, respectively. The difficulty may be understood as a measurement of how challenging it may be for various miners to locate a new block before eventually adding it to the blockchain. Within a month, this difficulty had dropped to 19.932 trillion from 25.046 trillion.
The crypto market had been caught in a ‘death spiral’ of sorts during the previous time when Bitcoin had experienced three negative difficulty adjustments consecutively. This ‘death spiral’ had been induced by miners back towards the end of 2018. This was when miners had switched off all equipment just as the prices were decreasing at a somewhat alarming rate.
China continues its crackdown
As opposed to before, it would appear as if the Sichuan region is the one mainly responsible for the aforementioned expectation in difficulty ultimately dropping. The province had halted all mining activities thanks to the continued crackdown by the Chinese officials, as the miners had been instructed to have all machines be switched off this past Saturday. As a result, both Huobi.pool and AntPool had lost more than 30% of their respective hash rate seemingly overnight. Foundry USA had been the only one that stayed in the green.
Other than Sichuan, other provinces such as Inner Mongolia, Qinghai and Xinjiang had also fallen victim to the crackdown. As of now, Bitcoin’s hash rate had decreased by a whopping 48% from its previous peak recorded on the 15th of April 2021, when it was 198.514 EH/s.