Bitcoin Difficulty Collapses 11% in Deepest Reset Since 2021

The capitulation is real. Bitcoin mining difficulty plunged 11.16% to 125.86 T on Saturday, marking the network’s sharpest downward adjustment since the historic China ban in May 2021.

This is not a standard correction. The double-digit reset confirms that a massive tranche of hashrate, roughly 40% at the peak of the exodus, was forced offline. The culprit is a brutal convergence of weather and economics: Winter Storm Fern paralyzed Texas grids just as Bitcoin lost the $70,000 support level, obliterating margins for all but the most efficient operators.

The Kill Zone: $32 Hashprice

Miners didn’t power down out of caution. They powered down because they were bleeding cash. Hashprice, the gold standard for miner revenue, bottomed out at an all-time low of $32 per petahash/second (PH/s) earlier this week, according to data from The Miner Mag.

For context, break-even costs for top-tier fleets like CleanSpark and IREN hover near $30 PH/s. For older fleets, the "kill zone" is anything below $40 PH/s. When BTC slid to $68,800, keeping S19-era machines running became an act of charity to the utility companies.

The economics of bitcoin mining are effectively reduced to a break-even proposition for some of the most efficient public operators.

The Survivor’s Dividend

The network’s pain is the survivor’s gain. This adjustment instantly increases the BTC yield for remaining hashrate by roughly 11%. For low-cost operators in stable jurisdictions, this translates to billions in annualized relief, effectively redistributing the block rewards from those who folded to those who held on.

But the relief may be temporary. If Bitcoin reclaims the $80,000 range, the sidelined fleet will likely plug back in, driving difficulty right back up. Until then, the network is leaner, centralized around the lowest-cost power, and waiting for the next price signal.