It is becoming increasingly difficult to mine bitcoins

Source

Recently, an all-time low in the production of satoshis per terahash has been reached at 501 satoshis. This record has been reached on December 26th of this year although miners reach on average a hashprice of 542 SAT/TH/D.

To better understand this, the hashprice reflects the productivity of the miners according to their hashrate per day. This can be calculated in dollars or bitcoin satoshis.

When the hashprice is represented in US dollars it should be taken into account that its value influences the value of the cryptocurrency market. While when it is represented in satoshis the value depends on the network's own values, such as hashrate, halvings and mining difficulty.

This decline is expected and even logical since every 4 years or so something called halving occurs. A halving is when the mining reward is reduced by half, in order to increase the difficulty of mining more bitcoins. As the difficulty increases, more people join in, increasing the mining power and thus increasing the difficulty producing more halvings.

As mentioned above it is logical that miners get less and less satoshis with their current mining power, and as time goes by miners will get less and less and less satoshis.

USD VS Bitcoin

Despite the drop in the amount of satoshis that can be obtained with the increasing difficulty of mining, mining will continue to be profitable due to the steady rise of bitcoin and the devaluation of the dollar against bitcoin. Currently having satoshis is still a better option and will remain so due to the constant inflation and devaluation of the US currency. I recently published an article talking about this and whether bitcoin could replace the US dollar.

As of today the hashprice value is around 0.26 USD/TH/D. Although this is a somewhat low value and is almost half of what it was worth in October and November, it is still high compared to the 0.18 USD/TH/D it reached in June, being its low of the year.

Sometimes the hashprice reflects a relationship with the cryptocurrency market although this is not always the case. An example of this is when in June bitcoin hovered around $33,000, and despite this the hashprice shot up and remained at $0.30/TH/D.

This spike may have been due to the difficulty adjustment in mining at that time was 28%. When the hash rate recovered after China's veto of bitcoin, this adjustment in difficulty meant that miners were able to earn higher rewards and have a higher return relative to the bitcoin price in dollars.

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