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Bitcoin (BTC) Network Maintains Bullish Momentum Despite Market Downtrend
The fundamentals of the Bitcoin (BTC) network seem impervious to the bearish trend in the BTC price this week. Recent on-chain data indicate that the hash rate is close to its record highs, while the mining difficulty breaks new records.
A Boost to Bitcoin Mining Amid BTC/USD Decline
Last week, despite BTC/USD depreciating by 10%, Bitcoin miners displayed resilience in the face of this downturn. This was evident on August 22 when the mining difficulty saw an increase by 6.17% during its latest fortnightly automatic adjustment.
This increase not only pushed the difficulty to unprecedented highs but also represented Bitcoin's sixth-largest difficulty increase this year, according to data from the BTC.com monitoring resource. Mining difficulty is an indicator of the competition between miners and network security, implying that miners, despite the bumpy market, are not yet strained for profitability.
The next automatic readjustment is projected to follow this trend, manifesting the difficulty level of upwards of 56 trillion for the first time in history.
Hash Rate Indicates Unwavering Trust in BTC
The hash rate, as an estimate of miners' contributions to the Bitcoin blockchain, presents an analogous scenario. While an exact calculation may be elusive, indications are that we are nearing the historical highs exceeding 400 Exahashes per second (EH/s), depending on the source.
In response to the data, MAC_D, a contributor to the CryptoQuant on-chain analytics platform, alluded to "immense confidence in the security and integrity" amongst operators of both Bitcoin network and Ether (ETH), the biggest alternative cryptocurrency.
Even as the BTC and ETH prices have nosedived by 10%, the trustworthiness and stability of these networks have surged. This is evident as the BTC hashrate illustrates elevated numbers during the market slump, suggesting miners' increased activity in BTC mining.
An Increase in Ethereum Staking
Simultaneously, the percentage of ETH staked illustrates a surge in stakes, despite a dip in its price, implying an uptick in network confidence," he noted in a Quicktake market update on August 22. Separate data from on-chain analytics firm Glassnode depict a slight increase in the BTC quantity held by mining bodies, representing more than 1.83 million BTC on August 22, marking a steady 0.08% increase since the month's commencement.
