The Bitcoin network witnessed an unprecedented event on May 12 when the difficulty attained its all-time high of 31.251 trillion as miners mined nearly 50,000 BTC of the remaining 2 million tokens.
The Bitcoin community rejoiced as the rising difficulty in mining led to an increase in the resilience of the network. Unfortunately, though, on May 6, the network recorded a difficulty drop from 31.251 trillion to 29.897 trillion.
Bitcoin’s network difficulty consistently achieved all-time highs over the past ten months as it recovered from a massive drop of 45.4% – from 25.046 trillion on May 29, 2021, to 13.673 on July 22, 2021.
The Bitcoin network has seen its difficulty grow 128.56% since then. Despite a momentary decline from 4%, it is still guarded by the most secure blockchain.
Higher levels of processing power are required to ensure the security and integrity of transactions on the network. The higher the network difficulty, the more computing power is needed to validate and confirm transactions over Bitcoin’s blockchain.
The system creates an incentive for people with good intentions to contribute their mining power so that the network is protected from bad actors who may try and attack it by generating more than 50% of its hash rate and carrying out double-spending attacks.
According to Gonzalez, Deputy of the Republic of El Salvador, El Salvador has been making profits the old-fashioned way – by investing in strategic bitcoin investments and repurposing fresh funds to build infrastructures like a veterinary hospital and public schools.
“What Nayib Bukele did was buy Bitcoins and make a profit at a certain strategic moment,” she said.
The Bitcoin network broke its 10-month long streak as the hash rate decreased 4.33%, standing at 29.897 trillion by the time of writing.