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Bitcoin had its biggest mining difficulty drop on November 3rd

As reported by cointelegraph.com on November 3rd, 2020, Bitcoin (BTC) saw its biggest negative difficulty adjustment in almost 10 years on November 3rd.

Estimates had suggested that the adjustment would be around 13%, but it was the second-highest in Bitcoin’s history. Only in 2011 was there a larger difference — 18%, which also came at the end of October.

Difficulty adjustments happen automatically every 2016 blocks, and allow Bitcoin to remain as “hard” money.

Such a reduction incentivizes more mining participants to compete for block subsidy rewards, with the result that the difficulty then begins to rise again.

For users, the downward adjustment will reduce fees and decrease block times, along with reducing the size of unmined transactions in Bitcoin’s mempool. According to estimates from Earn.com, the optimal Bitcoin transaction fee remains high, at 80,000 satoshis ($11).

However, with estimated weekly average values beginning to trend up, Bitcoin’s network hash rate appeared to be u-turning on its own descent. Hash rate provides a look into how much computing power is being dedicated to Bitcoin transaction validation. Several weeks ago, the metric was at an all-time high, but lost around 25% in the second half of October.

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