Bitcoin mining difficulty rises 5.92% as hashrate reaches seven-month high

Bitcoin's mining difficulty rose 5.92% on October 16 as network hashrate reached a seven-month high despite major publicly traded miners redirecting capacity toward artificial intelligence. BlocksBridge Consulting's latest Miner Weekly newsletter puts Bitcoin's seven-day average hashrate above 1 zettahash per second (ZH/s), equivalent to 1,000 exahashes per second (EH/s). BlocksBridge says that level is the highest since March 3. Hashrate measures the computing capacity used to secure Bitcoin's network.

BlocksBridge forecasts a further 5.16% difficulty increase at the next adjustment. Difficulty would rise roughly 11.4% over two successive adjustments if that forecast proves accurate. The hashrate recovery suggests other operators are replacing lost computing capacity, leaving miners with little competitive relief from the industry's transition to AI. BlocksBridge said the increases offer little respite for operators that have continued mining Bitcoin.

The AI transition has already removed substantial mining capacity from operation. BlocksBridge previously reported that publicly traded miners' realized hashrate fell 23%. BlocksBridge also reported that those miners' revenue from AI and high-performance computing rose 52% quarterly. BlocksBridge valued the displaced mining equipment at roughly $1.5 billion.

Smaller and mid-sized miners may be restoring some lost capacity by purchasing equipment from larger operators. BlocksBridge cited Sazmining, which markets used Antminer S21 XP machines for deployment at hosting facilities in Paraguay and Texas. Used machines could offer better economics than new equipment for miners with access to cheaper electricity. Equipment displaced by AI conversions could therefore remain in Bitcoin mining at other locations. However, the amount of equipment originating from publicly traded miners or returning to the network remains unclear.

Some industry observers regard increasing hashrate as an indirect positive signal for Bitcoin, reflecting continued institutional investment in publicly traded mining companies. CryptoQuant founder and CEO Ki Young Ju recently advanced that view on X. Ki argued that greater hashrate strengthens network security and improves Bitcoin's underlying qualities as a store of value.