Bitcoin hash rate and difficulty rise following price increase on back of Ethereum ETF speculation

Bitcoin BTC -0.48% mining difficulty rose 1.5% to 84.4 trillion on Thursday after the network’s seven-day moving average hash rate moved back above 600 EH/s.

The last Bitcoin difficulty adjustment on May 9 saw the metric fall 5.9%, the largest drop since the bear market lows of December 2022. The impact of reduced miner subsidy rewards following Bitcoin’s fourth halving event on April 20 began to take hold after an initial boost in transaction fee rewards stemming from the hype surrounding Runes subsided.

The hash rate remained relatively flat after that drop in the 580-590 EH/s range, with today’s adjustment initially expected to remain unchanged. However, amid renewed optimism for spot Ethereum ETH +2.27% exchange-traded funds approvals in the United States on Monday and the subsequent price rises across the crypto market, Bitcoin’s seven-day moving average hash rate jumped to around 606 EH/s by Wednesday, according to The Block’s data dashboard .

Bitcoin mining difficulty is a relative measure of how hard it is to mine a new block compared to the easiest it can ever be. It adjusts automatically every 2016 blocks — roughly two weeks — to ensure that, on average, a new block is found every 10 minutes, regardless of how many miners are actively mining.

When there’s an increase in the number of miners, the difficulty of mining bitcoin rises. Conversely, if there is a decrease in the number of miners competing to find new blocks, the protocol automatically lowers the mining difficulty — making it easier for the remaining miners to discover blocks.

Bitcoin mining difficulty. Image: Bitbo .

Bitcoin's hash price recovery

Bitcoin’s hash price has also recovered slightly after sliding to an all-time low of less than $50 per PH/s per day ($0.05 per TH/s per day) on April 29, reaching $55 per PH/s per day ($0.055 per TH/s per day) on Monday.

RELATED INDICES

Hash price is a term coined by Bitcoin mining services firm Luxor, referring to the expected value of 1 PH/s or 1 TH/s of hashing power per day. The metric quantifies how much a miner can expect to earn from a specific quantity of hash rate.

Bitcoin is currently trading for $69,736, according to The Block’s price page — up 5% this week. 

Meanwhile, ether is trading for $3,826 — up approximately 25% since Bloomberg ETF analysts Eric Balchunas and James Seyffart dramatically raised their odds of spot Ethereum ETF approvals from 25% to 75% on Monday amid signs of a 180 from the Securities and Exchange Commission — with crypto increasingly becoming a political issue . 

The SEC has final deadlines on Thursday and Friday to decide whether to approve or deny the applications for spot Ethereum ETFs submitted by VanEck and Ark Invest, respectively. Hashdex, Invesco, Fidelity, BlackRock, Grayscale, Franklin Templeton and Bitwise are also among spot Ethereum ETF applicants.