Mining difficulty hit record highs as network usage declined

Ethereum mining breaks records

Saturday, June 4, the difficulty of mining the Ethereum blockchain reached historic heights. According to data from Etherscan, this difficulty increased to 15,089,793 terrahashes (TH).

The higher this value, the more difficult it is to mine a network block. So, this metric is a increased function of computing power deployed to all miners, to guarantee the stability of the blockchain.

Figure 1: The difficulty of mining in Ethereum

As shown in Figure 1, since the Chinese ban last summer, the difficulty of mining continues to increase as new miners arrive to strengthen the network. In addition, the computing power deployed later is also available reached a new record this Saturdayaccording to the CoinWars website.

Hashrate

Figure 2: Ethereum hashrate

The hashrate, as it is called, thus arrives highest peak of 1.318 8 petahashes per second (PH/s). The condition is used here, because Etherscan returns a daily average value of 1.08 PH / s and does not offer an intraday chart to compare the data.

However, that doesn’t take away from the fact that the month of May is over a record for computing power sent by the miners to Ethereum, and that June it seems confirm the trend.

👉 To proceed – Find our guide on Ethereum (ETH)

Network usage is following the decline

Surprisingly, while the competition between minors is not yet as intense, the network has seen its attendance. hit the annual low with 401,055 active addresses as of June 4. It is required back on December 10, 2020with 381,124 active addresses, to find a lower value.

Active addresses

Figure 3: Active Ethereum addresses

June 4 also appears annually lower in the number of daily transactions, for a total of 1,029,121. As with the number of active addresses, Figure 4 shows us that we will also need to go back by the end of 2020 to find lower values. That is November 29, 2020 for 993,930 transactions.

Daily transactions

Figure 4: Number of daily transactions

This downtrend in Ethereum blockchain solicitation benefit these users. In fact, the price of transactions has been much lower in recent months, compared to what is seen in the heart of the bull run.

Average transaction price

Figure 5: Average price of a transaction

On May 28, the average price of a transaction was $ 3.73, down since July 11, 2021 which recorded $ 2.43.

The statistical aberration seen in Figure 5, which brings a daily average to $ 200.06 on May 1, is equivalent to land sales in Otherside, Yuga Labs ’metaverse.

The upcoming arrival of Merge

Decreased network traffic not exclusive to Ethereum. However, it follows a general trend, due to the fall in prices themselves, which makes avoid investors.

Like other cryptocurrencies, ETH now works a hinge zone, which was also defended at this time last year. This place is about $ 1,800.

ETH course

Figure 6: ETH price

An idea popular in the ecosystem describes that the price of ETH could rebound as Ethereum moves to proof-of-stake (PoS) consensus: the union.

This idea is defended by a future severe reduction in rewards Assigned to each block generation. Along with the burn mechanism, implemented in August with EIP-1559 combinationthis historic change could be equivalent to three halvings of the Bitcoin (BTC) network in terms of reducing inflation.

ETH burned

Figure 7: Number of ETHs burned since the implementation of EIP-1559

while 2.4 million ETHs have already been burnedasset scarcity is likely to decrease further, as long as the consensus change is good.

We can understand the recent mining records in Ethereum. Minors will benefit in previous months when it was still possible to join ETH by proof-of-work (PoW), prior to this activity pause.

However, there is no guarantee that the Merger will raise prices. First, it depends on overall ecosystem healthbut also keep in mind that 10% of all ETH in the network goes back into circulation.

The staking contract for Ethereum, 2.0 implemented on November 3, 2020, is really significant nearly 12.8 million ETH. It will be released how many hours after the final settings, once the transition to proof-of-stake has taken place. So investors can choose take and profitthus lowering the price.

👉 Also in the News – New York Senate Passes Moratorium on Cryptocurrency Mining

Sources: Etherscan, CoinWarz, TradingView, Beacon Chain contracts

Newsletter

Get a crypto news recap every Sunday 👌 And that’s it.

What you need to know about affiliate links. This page presents properties, products or services related to investments. Some links in this article are included. This means that if you buy a product or register a site from this article, our partner pays us a commission. This allows us to continue to offer you original and useful content. It has no effect on you and you can still get a bonus by using our links.

Investing in cryptocurrencies is risky. Cryptoast is not responsible for the quality of the products or services presented on this page and cannot be responsible, directly or indirectly, for any damage or loss caused after the use of a good or service featured in this article. Investments related to crypto-assets are risky in nature, readers should do their own research before taking any action and invest only within the limits of their financial capability. This article does not contain investment advice.

About the Author: Vincent Mayor

twitter-soothsayerdata

I was embarrassed to discover the world of the blockchain at the end of 2018 during my search for financial freedom. Initially invested in moderation, it was only two years ago that I gambled betting on everything in the movement that had formed before. I dedicate 2021 to training myself better to gain more knowledge and seriousness. As I’ve always wanted to say: I still have a billion things to learn. And what I know, I want to share with you.
All articles by Vincent Maire.

Leave a Comment