60 percent in third quarter 2019, bitcoin difficulty continues to grow

The degree of difficulty to mine bitcoin increases by two-thirds in the third quarter of 2019.

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42 percent increase every quarter

Analyst Kevin Rooke looked at data about the difficulty since 2016. He came to a remarkable conclusion. On average, since 2016 the difficulty level has been increased by 42 percent every quarter.

Bitcoin mining difficulty has been growing 42% PER QUARTER over the last 3 years!
Difficulty is projected to grow 60% this quarter, and it was already at an all-time high when Q2 ended ? pic.twitter.com/eFuyg1ZiXa
– Kevin Rooke (@kerooke) September 19, 2019

Each quarter saw an increase, with the exception of the fourth quarter of 2018, the high point (actually low point) of the bear market last year. But if you look at 2019, the growth seems to be almost parabolic.

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“The difficulty is expected to grow by 60% this quarter, and it was already at a record high when the second quarter ended,” writes Rooke in a response to his tweet.

But what is the level of difficulty?

The difficulty level indicates a certain goal that must be achieved in order to “win” with mines. This goal in turn indicates how small or large the winning number must be that miners must find.

An example: imagine a table with 1000 cups. Under each cup is a piece of paper with a number between 1 and 1000. For the easiest difficulty level, ask a miner to find a number between 1 and 1000. He already found it on his first attempt. We make something harder. He must find a number between 1 and 500. That’s a bit harder. A friend of the miner arrives and wants to participate. The two of them are now looking for a number between 1 and 500. Now it is becoming too easy again, they find the number very quickly. Out of the blue the bell rings and ten others want to participate. The system must now regulate itself to keep it exciting. Now they have to look for a number between 1 and 5.

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Only use a nonce

A miner shoots a number in an algorithm and that number (together with numbers coming from the previous block) is shaken to a result. That result must therefore be lower or equal to the level of difficulty. The miner only has influence by adjusting the number that he puts into the algorithm. And we call that number the nonce.

If you want to know everything about mines, blockchain, and difficulty levels, we recommend reading the Block Explained article.

Influence on the bitcoin rate

The computer power that all miners deliver together is also called hash rate. If the hash rate makes it too simple to mine, the level of difficulty adjusts, which happens approximately every two weeks. The difficulty level is therefore a good indication of the development of the hash rate on the bitcoin network.

Analyst Willy Woo discovered a strong correlation between the price of bitcoin and the level of difficulty. He developed the difficulty ribbon for this.

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