Second largest drop of the year! Bitcoin mining difficulty plummets 10%, price crashes trigger a wave of miner shutdowns

Bitcoin plummeting triggers a survival battle in the mining industry, leading to a decline in hash rate and triggering a difficulty adjustment. Mining difficulty drops sharply by 10.09%, reaching a new low since 2026, providing a temporary respite for remaining miners.

Bitcoin has been on a continuous decline recently, not only causing investors to break out in cold sweats but also sparking a brutal "survival war" in the mining industry. According to Galaxy Research data, Bitcoin completed a new difficulty adjustment over the weekend, with mining difficulty decreasing significantly from 138.96 T to 124.93 T, a single adjustment drop of 10.09%.

This is the 11th largest decrease in Bitcoin mining difficulty in history and the second largest drop since early February 2026. Currently, mining difficulty has fallen to its lowest level since 2026, even hitting a new low since July 2025.

Every 2,016 blocks (about two weeks) mined on the Bitcoin blockchain, difficulty is adjusted based on the total hash rate to ensure that, regardless of how many miners are mining, the "block production time" remains at approximately 10 minutes.

Mining difficulty essentially reflects the level of competition among miners; the higher the difficulty, the more intense the competition. If hash rate increases over the past two weeks, difficulty will also rise, making Bitcoin mining more difficult. Conversely, if hash rate declines, difficulty will decrease, making it easier for miners to solve blocks.

The recent significant drop in difficulty is mainly due to Bitcoin's price falling about 15% since June, which squeezed miners' profit margins, forcing some operators to shut down unprofitable mining rigs. The speed of new block production slowed, extending the previous adjustment cycle to 15.6 days, well beyond the original 14-day target, triggering a downward difficulty adjustment mechanism.

A crisis or an opportunity?

However, for miners who have survived this elimination round, the sharp drop in difficulty is undoubtedly a timely boon. A 10.09% reduction in difficulty means that each unit of hash power still operating can produce approximately 11% more Bitcoin.

Along with Bitcoin's recent rebound from its early June lows, this has successfully pushed up hash price (an indicator measuring expected returns per unit of hash power). According to Hashrate Index data, the hash price on Sunday reached $32.31 per PH/s per day, successfully escaping the earlier low of just over $20 earlier this month. This low level is generally seen by the market as a breakeven point for high-cost miners. Additionally, data shows the current 7-day average network hash rate is around 894 EH/s.

Is this a winter of recession, or industry transformation? The AI wave is siphoning off massive hash power

Since entering 2026, this is the third time Bitcoin mining difficulty has decreased by more than 5%, with previous decreases of 11.16% on February 7 and 7.76% in March. Notably, the two major drops in February and June both ranked among the top 11 in history, indicating that the mining industry is facing ongoing pressure rather than a one-time shock.

Looking deeper into the causes, the February adjustment was mainly due to shutdowns caused by North American winter storms; the June adjustment reflects not only weak Bitcoin prices but also an unstoppable industry structural shift, as miners are increasingly migrating their hash power toward artificial intelligence (AI) and high-performance computing (HPC) sectors. In fact, some mining companies that have shifted their focus to AI and HPC have seen their stock prices soar recently.

After the difficulty adjustment, the Bitcoin network has begun to stabilize. The average block time has returned to around 10 minutes. According to preliminary forecasts from Hashrate Index, the next difficulty adjustment (expected around June 27) will be approximately -0.8%, indicating that the hash power that went offline due to losses has largely recovered, and the bleeding has stopped.

Although the difficulty drop has given miners some breathing room, the overall industry remains precarious. According to Checkonchain’s difficulty regression model, as of June 13, the average cost of Bitcoin production was as high as $84,300, down from a record high of $87,000 earlier this year.

Compared to Bitcoin’s current market price of about $65,800, spot prices are roughly 25% below production costs. In other words, for every Bitcoin mined, miners are incurring nearly $18k in losses.

When spreading out all expenses, a high proportion of mining farms are still in the "losing more the more they mine" predicament. The recent difficulty reduction mainly benefits those with the latest, most efficient mining rigs; those relying on older, high-energy-consuming equipment are still unlikely to fill the profit gap.

Looking ahead, whether mining difficulty will rise again depends entirely on Bitcoin’s price. If the price can see a substantial and sustained recovery, it will likely attract miners to reinvest idle rigs; conversely, if prices remain sluggish or the "AI mining center transformation" trend continues, these lost hash powers may never return to the Bitcoin network.

• This article is reprinted with permission from: "Block Guest"
• Original title: "Bitcoin Mining Difficulty Plunges 10%! Marks the Second Largest Drop This Year, Price Crash Sparks 'Miner Shutdown Wave'"
• Original author: Block Sister Mel