The last time Bitcoin’s difficulty dropped by more than 16 percent, Bitcoin was trading at just $3.12 per coin
Bitcoin difficulty is on track to drop by more than 16 percent, which would be the second-largest negative adjustment in its entire existence. The good news for the bulls is that it will most likely mark a local BTC price bottom.
Miners are calling it quits
The coronavirus pandemic that rattled global markets didn’t spare Bitcoin (BTC). After the March 12 price crash, many small miners got backed into a corner.
Bitcoin’s hashrate, which displays the cumulative power of the network, crashed nearly 40 percent in lockstep with the price. It is currently below 100 Ehash/s, with the halving approaching in less than two months.
That said, the mammoth-size difficulty adjustment, which is going to happen at around 11 PM EST, is going to provide much-needed relief for miners.
A huge rally could be in the offing
The largest difficulty drop to date (18 percent) took place on Oct. 30, 2011. Back then, BTC was changing hands at just $3.12 after shedding about 70 percent of its value in just three months. Since then, BTC skyrocketed by more than 630,000 percent by the end of 2017.
While such humungous gains are most certainly out of reach for an already established asset class, the 15 percent difficulty drop that took place on Dec. 3, 2018, could indicate where BTC is headed next if history is any guide. The leading coin rallied by more than 300 percent in the first half of 2019 before retracing its stellar gains.