Before the last halving, many predicted Bitcoin’s so-called “spiral of death”. This theory is based on the idea that cutting the block bonus in half causes miners to emigrate due to the sudden loss of mining. As a result, the network speed decreases and the blocking time increases, which means that the mining work decreases further and pushes more miners off the network. It is reported that this cycle will continue until no one is left to crack Bitcoin (BTC).
On September 20, Bitcoin faced one of the biggest adaptation challenges in mining history. In fact, this is the second largest increase after the half. So, were all the prophets on the Day of Resurrection right?
To answer this question, we need to understand the causes of difficulty modification. All Bitcoin miners are competing to solve the next block. The more hashing power the network uses, the faster it can happen. To ensure that the generation rate remained at 10 min per block, Satoshi Nakamoto built a function in the protocol that adjusts the difficulty approximately every two weeks. If the time between blocks is less than this mark during this period, the difficulty increases. If the time between the blocks exceeds this number, the opposite occurs.
These last two modifications resulted from a massive increase in hash strength. Instead of supporting a death spiral scenario, this appears to indicate the excellent health of the Bitcoin network.