Bitcoin Network Difficulty Hits New High as Crypto Market Faces Turbulence

The Bitcoin network has reached a new milestone in its mining difficulty. This comes as the broader cryptocurrency market experiences a surge in liquidations.

According to Cointelegraph, Bitcoin’s network difficulty rose by over 10.5% on August 1. This marks the end of a three-month downward trend. The network difficulty is now at an all-time high of 90.66 trillion.

Network difficulty is a measure of how hard it is to create new Bitcoin blocks. A higher difficulty means miners need more computing power to process transactions. This makes the network more secure against attacks.

The increase in difficulty comes after a period of lower earnings for Bitcoin miners. Many miners had seen higher profits in July due to the previous lower difficulty. But the new rise may cut into their earnings again.

Bitcoin and Broader Crypto Market Records Massive Liquidations

At the same time, the crypto market is facing other challenges. Over $262 million in crypto positions were liquidated in the past 24 hours. This happened as Bitcoin’s price dropped along with the stock market.

Bitcoin was the most affected, with over $79 million liquidated. Of this, about $56 million were long positions. This means many traders bet on Bitcoin’s price going up.

The market downturn matches a bad day for stocks. The S&P 500 had its worst day in nearly two years. Weak U.S. job numbers raised fears of a recession.

Political factors are also affecting the market. U.S. Vice President Kamala Harris is now seen as the favorite to win the 2024 election. Some investors worry this could lead to stricter crypto rules.

Options traders seem to be preparing for more price drops. Data shows more demand for options that profit if Bitcoin’s price falls.

As of writing, Bitcoin is trading at around $61,750. The market remains uncertain, with both challenges and opportunities ahead.