Bitcoin Mining Gets a Rare Reset as Weaker Players Drop Out - Unchained

Bitcoin’s mining system just went through one of its biggest resets in years. Mining difficulty, a built-in setting that controls how hard it is to earn new bitcoin, fell by about 11%, the sharpest drop since China’s mining ban in 2021. That decline reflects how many machines have gone offline as prices slid and operating costs surged.

This story is an excerpt from the Unchained Daily newsletter.

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The pressure on miners has been intense. Bitcoin is down sharply from its October highs, while the amount miners earn for their computing power has fallen by roughly half, from about $70 to $35 at peak levels. For miners with older equipment or high electricity bills, running machines simply stopped making sense. Severe winter storms in the U.S., especially in Texas, added to the strain by forcing large mining sites to shut down to protect local power grids.

While the drop looks alarming, it’s also how Bitcoin self-corrects. With fewer miners competing, those still operating face less competition and slightly better odds of earning rewards. Historically, moments like this — when miners give up under pressure — have often marked periods where the market begins to stabilize.