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Key Takeaways:
- Bitcoin mining difficulty hit a record 127.6T, adjusting to 123.7T on Aug 9.
- The increase reflects rising miner confidence and network strength.
- Bitcoin remains twice as scarce as gold but significantly undervalued.
Bitcoin mining difficulty has surged to a new all-time high of 127.6 trillion, highlighting the increasing strength and competitiveness of the Bitcoin network. While the metric is expected to ease slightly to 123.7 trillion in the upcoming adjustment on August 9, this latest spike reflects a broader trend: more computing power is being committed to securing the network, even amid shifting miner activity.
How Bitcoin Mining Difficulty Works
Mining difficulty adjusts approximately every two weeks based on the total hashrate—or computing power—contributed to the network. This mechanism ensures that new blocks continue to be added every 10 minutes, maintaining the predictable issuance rate that underpins Bitcoin’s monetary policy. When more miners come online, difficulty increases; when miners drop off, it decreases.
This dynamic is not just a technical detail—it’s central to Bitcoin’s inflation resistance. By controlling how easily new coins can be mined, the network prevents oversupply and protects against sudden price drops.
Correlation Between Difficulty and Long-Term Price Trends
Recent data shows that mining difficulty dipped to 116.9 trillion in June and early July, before rebounding in late July. This recovery aligns with a historical trend of rising difficulty and suggests that miners are confident in Bitcoin’s long-term value proposition, despite short-term volatility.
Also Read: Bitcoin Eyes $116.5K Amid August Volatility Spike
In parallel, the stock-to-flow ratio—a measure of scarcity—places Bitcoin as twice as scarce as gold, with a ratio of around 120 compared to gold’s 60. Yet Bitcoin’s market cap remains just one-tenth of gold’s, leading some analysts, like PlanB, to argue that Bitcoin is significantly undervalued.
Gold market cap is ~$20T
— PlanB (@100trillionUSD) July 21, 2025
Bitcoin market cap is ~$2T
So, gold is worth 10x bitcoin
Gold scarcity (stock-to-flow ratio) is ~60
Bitcoin scarcity is ~120
So, bitcoin is 2x scarcer than gold
IMO bitcoin is at least 10x undervalued pic.twitter.com/j6dc9uTRhJ
Network Maturity and Resilience Increasing
While the upcoming difficulty adjustment may offer a temporary reprieve, the broader trajectory underscores the maturity and resilience of the Bitcoin network. As miner competition intensifies and computing power continues to grow globally, Bitcoin’s core economic structure—scarcity, security, and decentralization—remains intact and stronger than ever.
Disclaimer: The information in this article is for general purposes only and does not constitute financial advice. The author’s views are personal and may not reflect the views of Chain Affairs. Before making any investment decisions, you should always conduct your own research. Chain Affairs is not responsible for any financial losses.
I’m your translator between the financial Old World and the new frontier of crypto. After a career demystifying economics and markets, I enjoy elucidating crypto – from investment risks to earth-shaking potential. Let’s explore!
