Bitcoin Price Prediction: Price Falls Below $91K as Mining Difficulty Hits New High

Bitcoin is facing a downward trend of lower highs and
lower lows, with both technical and fundamental analyses showing a bearish
momentum. At the time of publication, the price on CoinMarketCap was 90,567,
representing a 3% and 8% decline in the past day and week, respectively.

Bitcoin’s mining landscape has reached a remarkable
milestone. The network’s difficulty adjustment, a measure of how hard it is to
mine a block, has climbed for the eighth consecutive time, hitting an all-time
high of 110.45 trillion.

This marks a 110.45 trillion-fold increase in
difficulty since Bitcoin’s inception, data from Glassnode showed. This reflects
the network’s resilience and the intensifying competition among miners.

The Difficulty Adjustment

Bitcoin’s difficulty adjustment recalibrates every
2,016 blocks, or approximately every two weeks, to maintain an average block
mining time of 10 minutes. This ensures that as the network’s computational
power, or hashrate, fluctuates, the mining process remains consistent.

Currently, the 7-day moving average for the hashrate
stands at an impressive 775 exahashes per second (EH/s), with projections
suggesting it could reach 1 zettahash before the next halving, according to
Coindesk.

Historically, such positive adjustments have coincided
with significant market turning points. In the bull market of 2021, difficulty reportedly
rose for nine consecutive adjustments, with the final increase aligning with
Bitcoin’s record high of $69,000.

Conversely, during the bear market of 2018, 17
positive adjustments led to a sharp market downturn, with Bitcoin falling from
$20,000 to a cycle low of $3,000, Coindesk reported. These patterns highlight a critical but ambiguous
trend: prolonged difficulty increases often indicate heightened market activity
but do not guarantee directional certainty.

Challenges for Miners

The rising difficulty presents significant challenges
for miners, squeezing profit margins as competition intensifies. In response,
some companies, like MARA Holdings, have diversified their operations, pivoting
to high-performance computing and AI sectors.

Others, such as MARA, have adopted financial
strategies like issuing convertible bonds and lending Bitcoin to secure
additional revenue streams.

The surge in difficulty occurs against a backdrop of
volatile Bitcoin prices, which recently retreated to around $90k amid
macroeconomic uncertainties. Robust U.S. jobs data and expectations of steady
Federal Reserve interest rates have dampened risk appetite, further pressuring
the crypto market.

Currently, Bitcoin price is trading at an important
support level below which prices could drop further. If the current level does
not hold, the other support levels to watch are $87k and $76k.

This article was written by Jared Kirui at www.financemagnates.com.
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