Relief is coming for Bitcoin miners.

Bitcoin’s hashrate — a measure of the raw computing power securing the network — is on track for a major difficulty adjustment.

Estimates point to a drop of around 9% by June 29. That would be the steepest drop since July 2021, when China booted its miners, sending hashrate off a cliff.

“The primary catalyst is miner revenue pressure,” Nishant Sharma, founder of Bitcoin mining communications firm BlocksBridge Consulting, told DL News.

Hashprice ,a key measure of miner profits, is “sharply below breakeven for many operations, forcing older or higher-cost rigs to shut down,” Sharma added.

For miners that have struggled amid low hashprices and a near-zero fee environment, the looming difficulty drop is a lifeline.

A sharp downward adjustment will instantly boost earnings per unit of compute, buy smaller miners a little runway, and slow the exodus of machines.

Texas heatwaves

Seasonal variations are also expected to contribute to the drop, according to Nick Hansen, CEO of mining outlet Luxor.

During the Northern Hemisphere’s summer months, miners often have to switch off their machines due to heatwaves stressing local energy grids, he told DL News.

That’s happened before in Texas, a major mining hub in the US, and is happening again today. Areas of the state are getting walloped by heatwaves, forcing Bitcoin miners to — albeit temporarily — switch off.

Bitcoin’s backbone

When machines go offline, whether that’s because of technical or financial issues, the time between the production of new blocks can stray from its every-ten-minute target.

To keep production on schedule, the protocol adjusts every 2,016 blocks, or two weeks on average.

Moreover, mining isn’t some nice-to-have activity within the Bitcoin protocol.

It’s the backbone of the network’s security, determining who gets to write new transactions to the blockchain.

If enough miners go offline — or if only the biggest players survive — Bitcoin’s decentralisation and trust model start to erode.

Already, Bitcoin mining is consolidating like never before as less profitable miners flail.

Transient drop

The incoming relief may be fleeting.

Only two months ago, for instance, miners were complaining that “higher than ever” difficulty was squeezing margins.

“Rising difficulty squeezes hashprice,” Eli Nagar, CEO of mining outlet Braiins, previously told DL News. He said most miners won’t relax until hashprice tops $60.

It’s now at $53, according to Hashprice Index.

If Bitcoin holds above $100,000 and hashprice pops, however, efficient farms will spin up idle rigs, pushing hashrate —and mining difficulty — to new tops, depressing hashprice anew.

Pedro Solimano is a markets correspondent based in Buenos Aires. Got a tip? Email him at psolimano@dlnews.com.