Bitcoin Difficulty Hits New Highs as Key Metric Signals Miner Capitulation and Possible Bottom

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By James Van Straten

Feb 10, 2025, 12:20 p.m. UTC

BTC: Difficulty Adjustment Percent Change (Glassnode)

What to know:

Bitcoin’s difficulty hit an all-time high of 114.7 T, rising 5.6%.
Hash Ribbon metric signaled a capitulation in miners, which tends to mark local bottoms in price.

Bitcoin (BTC) difficulty hit an all-time high of 114.7 trillion (T) following a 5.6% upward adjustment over the weekend, according to CoinWarz.

This coincides with the Hash Ribbon metric signaling a miner capitulation. Hash Ribbon, is a market indicator, which hints at a local bottom for bitcoin (BTC) and often forms when miners capitulate — when mining costs exceed profitability.

STORY CONTINUES BELOW

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According to Glassnode data, miner capitulation began in early February. Bitcoin is down over 4% month-to-date. Historically, when this metric signals capitulation, it has marked local price bottoms.

If this pattern holds, bitcoin’s bottom could be around $91,000. The last capitulation signal occurred in October 2024, just before BTC surged 50%.

This rise in difficulty is due to bitcoin’s rising hash rate, which hit an all-time high on Feb. 4. Mining difficulty adjusts every 2,016 blocks, targeting an average block time of 10 minutes.

As difficulty increases, mining becomes more competitive, placing additional pressure on miners. January’s production data reflects this, with Riot Platforms (RIOT) being the only major public miner to report a month-over-month production increase.

James Van Straten is a Senior Analyst at CoinDesk, specializing in Bitcoin and its interplay with the macroeconomic environment. Previously, James worked as a Research Analyst at Saidler & Co., a Swiss hedge fund, where he developed expertise in on-chain analytics. His work focuses on monitoring flows to analyze Bitcoin’s role within the broader financial system.
In addition to his professional endeavors, James serves as an advisor to Coinsilium, a UK publicly traded company, where he provides guidance on their Bitcoin treasury strategy. He also holds investments in Bitcoin, MicroStrategy (MSTR), and Semler Scientific (SMLR).