{"id":290096,"date":"2021-07-03T09:41:32","date_gmt":"2021-07-03T06:41:32","guid":{"rendered":"https:\/\/en.buradabiliyorum.com\/bitcoin-mining-difficulty-just-fell-by-a-record-28-but-will-this-help-btc-price-recover\/"},"modified":"2021-07-03T09:41:32","modified_gmt":"2021-07-03T06:41:32","slug":"bitcoin-mining-difficulty-just-fell-by-a-record-28-but-will-this-help-btc-price-recover","status":"publish","type":"post","link":"https:\/\/buradabiliyorum.com\/en\/bitcoin-mining-difficulty-just-fell-by-a-record-28-but-will-this-help-btc-price-recover\/","title":{"rendered":"# Bitcoin mining difficulty just fell by a record 28% \u2014 But will this help BTC price recover?"},"content":{"rendered":"<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_85 counter-hierarchy ez-toc-counter ez-toc-custom ez-toc-container-direction\">\n<p class=\"ez-toc-title\" style=\"cursor:inherit\">Table of Contents<\/p>\n<label for=\"ez-toc-cssicon-toggle-item-6a35c08973d2e\" class=\"ez-toc-cssicon-toggle-label\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #dd3333;color:#dd3333\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #dd3333;color:#dd3333\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/label><input type=\"checkbox\"  id=\"ez-toc-cssicon-toggle-item-6a35c08973d2e\" checked aria-label=\"Toggle\" \/><nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/buradabiliyorum.com\/en\/bitcoin-mining-difficulty-just-fell-by-a-record-28-but-will-this-help-btc-price-recover\/#Hash_rate_model_Long_road_ahead_to_Bitcoin_bottom\" >Hash rate model: Long road ahead to Bitcoin bottom<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/buradabiliyorum.com\/en\/bitcoin-mining-difficulty-just-fell-by-a-record-28-but-will-this-help-btc-price-recover\/#Pick_your_end-of-year_price_showdown\" >Pick your end-of-year price showdown<\/a><\/li><\/ul><\/nav><\/div>\n<p>&#8220;<strong># Bitcoin mining difficulty just fell by a record 28% \u2014 But will this help BTC price recover?   <\/strong>&#8221;<\/p>\n<div class=\"post-content\" data-v-128018ef>Bitcoin (BTC) has recorded its biggest mining difficulty drop of nearly 28% on July 3, but one model suggests that the BTC price will not bottom until October.<\/p>\n<p>In a <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/twitter.com\/nsquaredcrypto\/status\/1410968604758130691\">series of tweets<\/a> on July 2, investment manager Timothy Peterson flagged the relationship between Bitcoin price and hash rate as arguable evidence that the dip is not over.<\/p>\n<figure><img decoding=\"async\" src=\"https:\/\/s3.cointelegraph.com\/uploads\/2021-07\/a6ea4888-103d-4ed3-bbba-7d245f29302f.png\"><figcaption style=\"text-align: center;\"><em>Bitcoin network hash rate 7-day average. Source: Blockchain.com<\/em><\/figcaption><\/figure>\n<h2><span class=\"ez-toc-section\" id=\"Hash_rate_model_Long_road_ahead_to_Bitcoin_bottom\"><\/span>Hash rate model: Long road ahead to Bitcoin bottom<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>Bitcoin mining difficulty dropped by an estimated 27.94% on Saturday at block height\u00a0689,472, the biggest in its history. <\/p>\n<p>As Cointelegraph previously explained, the drop is in response to the ongoing miner migration out of China and the subsequent loss of hash rate.<\/p>\n<p>For miners still at work, the decrease will be something of a profit boost \u2014 difficulty automatically accounts for changes in hash rate, making it more attractive to mine when it drops. <\/p>\n<p>Miners in flux are not expected to return to their craft completely for several months. In that time, difficulty will likely increase again as hash rate goes up \u2014 more competition and more power competing for the same set reward.<\/p>\n<p>It is a classic mantra among Bitcoiners that \u201cprice follows hash rate\u201d \u2014 but if that is true, one model charting the phenomenon is painting a sobering picture of future price behavior.<\/p>\n<p>Peterson noted that the relationship between price and hash rate is \u201cuseful\u201d when it comes to marking macro price tops.<\/p>\n<p>An accompanying chart shows spikes in 2013 and 2017, corresponding to tops which held for an entire four-year halving cycle. <\/p>\n<p>2021 looks similar, but since the May capitulation, the relationship has been trending towards 1 \u2014 the point at which the Bitcoin price should have fully \u201ccorrected.\u201d<\/p>\n<p>\u201cBased on the current trend in P(h), this bubble would finish collapsing by 31 October,\u201d Peterson summarized. <\/p>\n<blockquote><p>\u201cThe ratio includes any combination of a higher hash rate and lower price. So increasing hash rate and stable price also resolves the bubble.\u201d<\/p><\/blockquote>\n<figure><img decoding=\"async\" src=\"https:\/\/s3.cointelegraph.com\/uploads\/2021-07\/30d52de9-9b65-4b2c-a6d3-fa35fdf3721d.png\"><figcaption style=\"text-align: center;\"><em>Bitcoin hash rate ratio chart. Source: Timothy Peterson\/ <a href=\"https:\/\/buradabiliyorum.com\/en\/category\/social-mediaa\/\" data-internallinksmanager029f6b8e52c=\"1\" title=\"Social Media\" target=\"_blank\" rel=\"noopener\">Twitter<\/a><\/em><\/figcaption><\/figure>\n<p>In other words, the return of miners is likely to prevent further price dip episodes of the magnitude seen recently, but bulls may still need to wait longer than desirable to see higher levels return.<\/p>\n<p>An important caveat came from Peterson, who cautioned that there are \u201cmany things wrong\u201d with such a simple model, and that he himself does not use it.<\/p>\n<h2><span class=\"ez-toc-section\" id=\"Pick_your_end-of-year_price_showdown\"><\/span>Pick your end-of-year price showdown<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>The model is not the only source catering to a return to form for Bitcoin in the latter half of the year. <\/p>\n<p><strong><em>Related:\u00a0Bitcoin sees 4.5% dip amid warning BTC price indicator bottom may still come<\/em><\/strong><\/p>\n<p>As Cointelegraph reported, analysts have likened 2021 to both previous top years, these seeing a first local price peak, a correction then a surge to the ultimate top later on.<\/p>\n<p>After BTC\/USD posted its third consecutive monthly red candle, meanwhile, the stock-to-flow price model echoed the start of 2019, just after the pit of Bitcoin\u2019s last major bear market. <\/p>\n<p>The next six months, creator PlanB says, will be critical for its utility. <\/p>\n<p><template data-name=\"subscription_form\" data-type=\"markets_outlook\"><\/template><\/div>\n<p><script async src=\"https:\/\/platform.twitter.com\/widgets.js\" charset=\"utf-8\"><\/script><\/p>\n<blockquote><p><strong><span style=\"color: #ff6600;\">If you liked the article, do not forget to share it with your friends. Follow us on\u00a0<span style=\"color: #ff0000;\"><a style=\"color: #ff0000;\" href=\"https:\/\/news.google.com\/publications\/CAAqBwgKMLG0nwswvr63Aw\" target=\"_blank\" rel=\"nofollow noopener noreferrer\">Google News<\/a><\/span>\u00a0too, click on the star and choose us from your favorites.<\/span><\/strong><\/p><\/blockquote>\n<blockquote>\n<p style=\"text-align: center;\">For forums sites go to <span style=\"color: #ff9900;\"><a style=\"color: #ff9900;\" href=\"https:\/\/forum.buradabiliyorum.com\/\" target=\"_blank\" rel=\"noopener\">Forum.BuradaBiliyorum.Com<\/a><\/span><\/strong>\n<\/p><\/blockquote>\n<blockquote>\n<p style=\"text-align: center;\"><strong>If you want to read more <a href=\"https:\/\/buradabiliyorum.com\/en\/category\/news\/\" data-internallinksmanager029f6b8e52c=\"2\" title=\"News\" target=\"_blank\" rel=\"noopener\">News<\/a> articles, you can visit our <span style=\"color: #ff9900;\"><a style=\"color: #ff9900;\" href=\"https:\/\/en.buradabiliyorum.com\/general\/\" target=\"_blank\" rel=\"noopener\">General category.<\/a><\/span><\/strong><\/p>\n<\/blockquote>\n<p><span style=\"color: black;\"><a style=\"color: #ff9900;\" href=\"https:\/\/cointelegraph.com\/news\/bitcoin-mining-difficulty-just-fell-by-a-record-28-but-will-this-help-btc-price-recover\" target=\"_blank\" rel=\"noopener\">Source<\/a><\/span><\/p>\n","protected":false},"excerpt":{"rendered":"<p>&#8220;# Bitcoin mining difficulty just fell by a record 28% \u2014 But will this help BTC price recover? &#8221; Bitcoin (BTC) has recorded its biggest mining difficulty drop of nearly 28% on July 3, but one model suggests that the BTC price will not bottom until October. In a series of tweets on July 2,&#8230;<\/p>\n","protected":false},"author":1,"featured_media":290097,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"fifu_image_url":"https:\/\/images.cointelegraph.com\/images\/1200_aHR0cHM6Ly9zMy5jb2ludGVsZWdyYXBoLmNvbS91cGxvYWRzLzIwMjEtMDcvNjBjYTdmYjgtMjdmMi00ZjliLWE2NGYtYjlmOTZjNmE5MWFiLmpwZw==.jpg","fifu_image_alt":"","footnotes":""},"categories":[1],"tags":[74862,74937,75042,73785],"class_list":["post-290096","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-general","tag-bitcoin","tag-bitcoin-price","tag-mining","tag-markets"],"_links":{"self":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts\/290096","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/comments?post=290096"}],"version-history":[{"count":0,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts\/290096\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/media\/290097"}],"wp:attachment":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/media?parent=290096"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/categories?post=290096"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/tags?post=290096"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}