Bitcoin mining difficulty falls the most since 2021 amid miner capitulation

Bitcoin mining difficulty posted its sharpest decline since China’s 2021 crackdown on the industry, falling by about 11% as lower prices, power outages and winter storm disruptions in the U.S. forced large numbers of miners offline.

The latest adjustment reduced difficulty from more than 141.6 trillion to roughly 125.86 trillion, according to Blockchain.com data. Mining difficulty resets roughly every two weeks to keep block times near Bitcoin’s 10-minute target, meaning a sustained drop reflects a meaningful reduction in active hashrate.

The decline comes amid intense pressure on miner economics. Bitcoin has retreated from an October all-time high of $126,000 to around $69,500, cutting profitability across the sector. Mining revenue per unit of computing power has fallen sharply, with revenue per petahash dropping from about $70 at the peak to roughly $35.

That squeeze has forced many operators—particularly those using older machines or paying higher electricity costs—to shut down rigs. Others have shifted capacity toward artificial-intelligence workloads, where large technology companies offer long-term contracts with more predictable returns.

Bitfarms was among the most prominent examples, with its shares jumping after the company said it is pivoting away from bitcoin mining to focus on data-center development for high-performance computing and AI.

Severe winter storms, especially in Texas, compounded the situation. Grid operators issued curtailment requests to prioritize residential electricity use, prompting publicly listed miners to scale back production. Some firms reported daily bitcoin output falling by more than 60%.

Although sharp difficulty declines can appear alarming, the adjustment is designed to be self-correcting. For miners that remain online, reduced competition can improve margins and help stabilize operations.

Historically, major drops in mining difficulty have coincided with periods of miner capitulation and have often preceded market stabilization or price rebounds, as miners sell bitcoin to meet operating expenses.