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Bitcoin’s mining difficulty recorded a modest decline in its first adjustment of 2026, marking a pause after a year of repeated all-time highs that pushed miners to their limits.The Bitcoin network difficulty — a measure of how hard it is to mine a new block — slipped to 146.4 trillion, according to network data. This adjustment reflects slightly faster-than-target block production during the previous period. Next Difficulty Adjustment Expected to Rise AgainDespite the recent dip, the next difficulty recalibration is already projected to move higher. Data from CoinWarz estimates that the next adjustment, expected around Jan. 22, 2026, could increase mining difficulty to approximately 148.2 trillion.At the time of writing, average block times stand at 9.88 minutes, marginally below Bitcoin’s 10-minute target. When blocks are found too quickly, the network responds by increasing difficulty to maintain stability. Mining Difficulty Still Below November PeakWhile 2025 saw multiple record-breaking difficulty increases, the current level remains well below the all-time high of 155.9 trillion, reached in November 2025. The final adjustment of last year nudged difficulty higher, but the broader trend has softened entering 2026.Higher difficulty translates into greater competition among miners, making block rewards harder to secure — a challenge compounded by economic and regulatory pressures that defined much of 2025. 2025 Was the Toughest Year Ever for Miner MarginsBitcoin miners endured what analysts describe as the most severe margin compression in history. The April 2024 halving cut block rewards in half, while rising energy costs, macroeconomic uncertainty, and a crypto market downturn further strained operations.The sell-off that began in November pushed BTC prices sharply lower, intensifying the pressure on mining profitability. Hash Price Fell Below Breakeven LevelsA key metric, miner hash price — which measures expected daily revenue per unit of computing power — dropped below critical thresholds late last year.Historically, miners face difficult decisions when hash price falls below $40 per petahash per second per day. In November 2025, that figure slid under $35, marking a multi-year low and forcing some operators to power down less efficient rigs. Additional Headwinds: Tariffs and Market VolatilityU.S. tariffs introduced under President Donald Trump also weighed on mining companies, raising concerns about ASIC supply chain disruptions and increased hardware costs.Meanwhile, a sharp market correction triggered by an October flash crash sent Bitcoin prices down more than 30% in November, briefly pushing BTC to just above $80,000.Although Bitcoin has since rebounded, prices remain well below the October all-time high above $125,000, keeping miner profitability under pressure as 2026 begins. Outlook for Bitcoin Mining in 2026The slight drop in mining difficulty may offer temporary relief, but ongoing volatility, energy costs, and regulatory uncertainty suggest miners will continue to face a challenging environment.With difficulty expected to trend higher again, efficiency, access to low-cost energy, and scale will remain critical for miners hoping to survive and thrive in the evolving Bitcoin mining landscape.

Bitcoin Mining Difficulty Drops in First Network Adjustment of 2026

On-chain analyst Willy Woo has pushed back strongly against growing claims that Bitcoin’s four-year market cycle has come to an end, arguing that current price data still aligns with the traditional cyclical structure — at least through 2026.Woo believes recent skepticism stems from misinterpretations of short-term data and social media narratives, not from structural evidence that Bitcoin’s cycle has fundamentally changed. The “Heartbeat” Analogy: Why Cycles Still MatterTo explain his position, Woo used a medical analogy. Just because a heartbeat slows during sleep doesn’t mean the heart has stopped beating. Similarly, slight changes in the timing or intensity of Bitcoin’s price movements do not signal the disappearance of its four-year rhythm.According to Woo, external factors such as ETFs, macroeconomic conditions, or liquidity injections may alter the pace of the cycle, but the underlying supply-and-demand pulse — driven largely by halvings — remains intact.Until Bitcoin’s price action moves deeper into 2026 and displays clearly non-cyclical behavior, Woo argues the four-year model is still the most reliable framework. Industry Leaders Argue the Cycle Is ObsoleteWoo’s view contrasts with opinions from several high-profile crypto figures. Bitwise CIO Matt Hougan and researcher Ryan Rasmussen have suggested that Bitcoin has entered a new era, where the traditional halving-driven boom-and-bust cycles are significantly weakened.Their argument centers on the rise of spot Bitcoin ETFs and institutional capital, which they believe are smoothing volatility and preventing the extreme 70–80% drawdowns seen in earlier cycles.From this perspective, Bitcoin is transitioning into a longer, more stable bull market, rendering the classic four-year cycle less relevant. A More Mature Bitcoin Market?Other analysts interviewed by Bitcoin.com News share this outlook, emphasizing that ETF flows and macroeconomic forces now play a greater role in price discovery than miner reward halvings.They argue Bitcoin is increasingly behaving like a mature financial asset — with slower appreciation, fewer crashes, and stronger correlation to global liquidity trends — rather than a purely halving-driven speculative market.In this view, Bitcoin’s future may resemble traditional markets: steadier growth instead of explosive cycles. Woo Responds to Criticism and Reaffirms His ThesisAddressing personal criticism online, Woo rejected claims that a hedge fund he managed collapsed in 2020.“That was not my fund,” Woo clarified. “My first fund, Crest, launched in 2022 and is still operating today with consistent returns. We currently run three institutional funds, including SyzCrest in partnership with Syz Banking Group.” What Still Drives the Four-Year Cycle?When asked what continues to support Bitcoin’s cyclical behavior, Woo pointed to two core forces: The internal supply shock caused by Bitcoin halvingsThe global four-year liquidity cycle, which influences risk-on and risk-off market behaviorWoo noted that Bitcoin has historically led broader macro markets into risk-off phases on three prior occasions. Whether the current environment represents the fourth instance remains under debate — but it would still fall within Bitcoin’s entire historical lifespan.Supporters of Woo’s thesis also highlight ongoing government stimulus and liquidity injections, arguing that once this capital filters through risk assets, it could reignite the cyclical expansion pattern observed in previous Bitcoin cycles. Bottom LineWhile institutional adoption and ETFs have undeniably changed Bitcoin’s market structure, Willy Woo maintains that the four-year cycle is not dead — only evolving. Until price action decisively proves otherwise, he believes dismissing the cycle entirely is premature.

Willy Woo Defends Bitcoin’s Four-Year Cycle, Rejecting Claims That the Pattern Is Dead

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Despite being widely viewed as fundamentally undervalued, Bitcoin is expected to remain stuck in a bear market phase as analysts see no immediate catalyst for a strong upside move.After a highly volatile period in October and November 2025, Bitcoin has entered a phase of consolidation, trading within a narrow $85,000–$90,000 range for several consecutive weeks. Market observers say this sideways action could continue well into 2026. Analysts Expect Range-Bound Bitcoin Price ActionAccording to Gerry O’Shea, Head of Global Market Insights at Hashdex, potential catalysts do exist — including shifts in U.S. monetary policy or progress on crypto regulation in Congress — but none appear imminent.“For now, Bitcoin is firmly range-bound,” O’Shea said, adding that while bullish developments are possible, the market lacks the momentum needed to break higher in the short term.Jim Ferraioli, Director of Crypto Research at Schwab’s Center for Financial Research, shared a similar outlook. While Schwab remains constructive on Bitcoin’s long-term prospects, Ferraioli expects 2026 to be a quieter year for crypto markets. Market Digesting a Massive Multi-Year RallyFerraioli noted that the current slowdown reflects a natural cooling period after an extended bull run.“From the November 2022 lows to the October 2025 peak near $126,000, Bitcoin delivered nearly an 8x return in three years,” he said. “The market is still absorbing those gains.”Since that peak, on-chain activity has declined, transaction fees have remained low, and long-term holders have gradually reduced exposure. At the same time, spot Bitcoin ETF flows have become the dominant price driver, replacing organic network usage as the primary market signal. ETF Flows Now Drive Bitcoin’s Short-Term DirectionThe rise of Bitcoin ETFs has increased accessibility for investors but may also be distorting short-term market dynamics.“Exchange balances hit historic lows, long-term holders were selling, and price action became almost entirely dependent on ETF flows,” Ferraioli explained. “But true institutional capital is still largely absent.”According to Ferraioli, clearer regulatory frameworks could unlock deeper institutional participation — a development he views as essential for a sustainable next rally. Bitcoin Narrative Stalls as Institutional Demand CoolsHyunsu Jung, CEO of Hyperion DeFi, said Bitcoin’s investment narrative has lost urgency, particularly as ETF inflows slowed after an early-2025 surge. Without renewed demand from institutions or a significant macroeconomic shift, Jung expects continued sideways movement.Will Reeves, CEO of fintech firm Fold, described the situation as a waiting game. “Bitcoin is deeply undervalued,” he said. “But the market needs persistent sellers to fully exhaust before a new wave of buyers can step in.” Is Bitcoin Still in a Bear Market?Whether the current phase qualifies as a full-blown crypto winter remains debated. Ferraioli believes Bitcoin meets the classic definition of a bear market, though he emphasized that sharp corrections are normal given the asset’s volatility.“A 30% drawdown is almost expected for Bitcoin,” he said.While Bitcoin often shows periods of correlation with equities, Ferraioli stressed that its long-term drivers remain unique — including fixed supply growth, global liquidity conditions, and adoption trends.“The biggest unknown for 2026 is adoption,” he concluded. “That’s what will ultimately determine Bitcoin’s next major move.”

Bitcoin “Deeply Undervalued” but Bear Market Likely to Persist Without a Clear Catalyst

Bitcoin miners are continuing to face declining profitability, even as competition on the network eases, according to a new report from JPMorgan.The investment bank noted that while the Bitcoin network hashrate fell for a second consecutive month in December, miners’ revenues and gross profits continued to deteriorate, reaching record lows. Bitcoin Hashrate Declines for Second Straight MonthJPMorgan analysts reported that the average monthly network hashrate — a key indicator of mining competition — dropped by 30 exahashes per second (EH/s) in December, representing a 3% month-over-month decline.The network’s average hashrate stood at approximately 1,045 EH/s, marking the second straight monthly contraction and signaling reduced competitive pressure among miners.Hashrate measures the total computational power securing the Bitcoin network and is widely used as a proxy for mining difficulty and competition. Mining Revenue Hits Record LowsDespite the easing competition, mining profitability continued to fall sharply.According to JPMorgan’s estimates:Daily block reward revenue per EH/s averaged $38,700 in DecemberThis figure was down 7% from November and 32% lower year-over-year, marking the lowest level on recordDaily gross profit per EH/s also declined 9% month-over-month to roughly $17,100These figures highlight the mounting pressure on miners’ margins. Why Mining Margins Are Under PressureWhile the report did not specify a single cause, JPMorgan suggested several contributing factors:Lower Bitcoin prices since OctoberThe impact of the most recent Bitcoin halving, which reduced block subsidiesRising energy costs, further squeezing operating marginsTogether, these forces have offset the benefits of reduced network competition. Public Bitcoin Miners Still Outperformed in 2025Despite recent profitability challenges, publicly traded Bitcoin miners delivered strong equity performance in 2025.JPMorgan noted that the combined market capitalization of the 14 U.S.-listed Bitcoin miners and data center operators it tracks rose to $48 billion by year-end, representing a 73% increase over the year. Performance highlights included:Hut 8 (HUT): Best performer in December, gaining 2%CleanSpark (CLSK): Worst performer, falling 33%Only two companies outperformed Bitcoin in December, butNine of the fourteen miners beat Bitcoin’s performance over the full year, led by IREN (IREN) and Cipher Mining (CIFR) Outlook: Efficiency Is Now CriticalThe data suggests that while mining competition is easing, profitability will remain under pressure unless Bitcoin prices recover or operational efficiencies improve. As block rewards continue to shrink post-halving, miners with low-cost energy access, scale, and optimized hardware are likely to be the long-term survivors.

Bitcoin Mining Profits Keep Shrinking Despite Lower Network Competition, JPMorgan Reports

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A key on-chain indicator suggests that Bitcoin’s sharp decline in late November may have marked a market bottom, with historical data pointing to significant upside potential ahead.The metric in focus is the short-term holder (STH) profit-to-loss ratio, which compares the amount of BTC held at a profit versus a loss by investors who have held their coins for less than 155 days. Short-Term Holder Ratio Hit Extreme LowsAs Bitcoin plunged toward the $80,000 level in late November, the STH profit-to-loss ratio dropped to an extreme 0.013 on Nov. 24, according to Glassnode data.Historically, readings at or near this level have coincided with either local market bottoms or the definitive end of bear markets. Similar extremes were observed at major turning points in 2011, 2015, 2018, and 2022. Losses Peaked as Profits CollapsedAt the November low:The 7-day moving average of short-term holder supply in profit fell to roughly 30,000 BTCMeanwhile, short-term holder supply in loss surged to 2.45 million BTC, the highest level since the FTX collapse in November 2022, when Bitcoin bottomed near $15,000This imbalance reflected widespread capitulation among newer market participants — a condition that has historically preceded trend reversals. Ratio Recovery Signals Improving Market HealthSince the start of 2026, Bitcoin has rebounded strongly, climbing above $94,000, representing a gain of more than 7%.During this recovery:Short-term holder supply in loss declined to around 1.9 million BTCShort-term holder supply in profit jumped to approximately 850,000 BTCThe profit-to-loss ratio recovered to roughly 0.45This rebound indicates that a growing share of recent buyers are once again in profit. Why This Matters for Bitcoin’s Next MoveHistorically, when the STH profit-to-loss ratio approaches 1, it often continues higher, signaling the start of a sustained bullish phase. Market tops, by contrast, have tended to occur only when the ratio expands dramatically toward extreme levels near 100.With the ratio still well below equilibrium, the data suggests there is substantial room for further upside before the market reaches overheated conditions. Conclusion: On-Chain Data Points to Upside AheadWhile no single metric guarantees future price action, the short-term holder profit-to-loss ratio has repeatedly proven effective at identifying market inflection points. Its sharp recovery from historically extreme lows strengthens the case that Bitcoin’s late November sell-off marked a bottom, rather than the start of a prolonged downturn.If historical patterns hold, Bitcoin may be entering the early stages of its next sustained upward move.

This On-Chain Metric Signals Bitcoin’s Late November Crash Likely Marked the Bottom

Despite Bitcoin’s growing institutional adoption in 2025, misconceptions about its environmental impact continue to circulate. According to ESG analyst Daniel Batten, many of the most common criticisms of Bitcoin mining are based on outdated assumptions rather than empirical evidence.In a recent post on X, Batten outlined nine widespread myths about Bitcoin’s energy use, arguing that peer-reviewed studies and real-world data directly contradict them.“Every disruptive technology faces criticism rooted in misunderstanding, limited data, and fear of the unknown,” Batten noted.High-profile media outlets have fueled these narratives in recent years. In November, Dow Jones criticized Harvard University for allocating part of its endowment to Bitcoin, calling it an environmental disaster. Earlier, Bloomberg claimed Bitcoin “consumes electricity meant for the world’s poor.” Myth 1: Bitcoin Is Resource-Intensive Per TransactionOne of the most persistent claims is that Bitcoin uses excessive energy, water, and hardware resources per transaction. Batten says this is factually incorrect.Multiple peer-reviewed studies have shown that Bitcoin’s resource usage is independent of transaction volume, meaning the network can scale without increasing energy consumption. Myth 2: Bitcoin Mining Destabilizes Power GridsContrary to popular belief, Bitcoin mining does not strain electrical grids. In fact, Batten argues it often improves grid stability through flexible load management.This effect is especially visible in renewable-heavy regions such as Texas, where miners can quickly shut down during peak demand and absorb excess energy when supply is high. Myth 3: Bitcoin Mining Raises Electricity Prices for ConsumersThere is no credible data showing that Bitcoin miners drive up electricity costs for households. According to Batten, neither peer-reviewed research nor market data supports this claim.In several documented cases, mining operations have actually contributed to lower prices by stabilizing demand and funding infrastructure upgrades. Myth 4: Comparing Bitcoin’s Energy Use to Countries Is MeaningfulComparisons between Bitcoin’s energy consumption and that of entire nations are misleading. Batten cites the IPCC, which emphasizes that climate impact depends more on energy sources than on raw consumption.The relevant question is not how much energy Bitcoin uses, but where that energy comes from. Myth 5: Bitcoin Has a Massive Carbon FootprintBitcoin mining itself produces no direct emissions. Its environmental impact comes solely from electricity generation, making its emissions “scope-2” rather than direct.Importantly, Batten highlights that Bitcoin is the only global industry with verified third-party data showing more than 50% of its energy comes from sustainable sources—a milestone few sectors have reached. Myth 6: Proof-of-Stake Is Automatically Greener Than Proof-of-WorkSome argue that Ethereum’s proof-of-stake model is inherently more environmentally friendly than Bitcoin’s proof-of-work. Batten disagrees, saying this argument confuses energy use with environmental harm.Proof-of-work mining can:Reduce methane emissionsStabilize energy gridsSupport renewable energy expansionMonetize wasted or stranded energyThese benefits, he argues, are often overlooked in simplified comparisons. Myth 7: Methane and Flare Gas Could Be Used More Productively ElsewhereWhile it’s technically possible to repurpose landfill or flare gas, Batten says it is economically unviable without Bitcoin mining.Bitcoin’s unique incentive structure makes it one of the few solutions capable of turning stranded methane into a usable and profitable energy source. Myth 8: Bitcoin Mining Diverts Renewable Energy From CommunitiesEvidence suggests the opposite. Bitcoin mining has enabled renewable energy access in regions that previously lacked it.Batten points to projects like Gridless in Africa, which has helped bring renewable electricity to an estimated 28,000 people through Bitcoin-powered microgrids. Myth 9: Bitcoin Mining Wastes EnergyThe idea that Bitcoin “wastes energy” ignores the reality of renewable generation. Solar and wind often produce excess power that would otherwise be discarded.Studies cited by Batten show Bitcoin mining can achieve over 90% utilization of renewable energy, significantly reducing waste.Moreover, labeling energy use as “waste” is subjective. Energy can only be considered wasted if it produces no benefit—and Bitcoin, Batten argues, delivers clear economic and social value. Conclusion: Data Over DogmaAccording to Batten, the environmental debate around Bitcoin should be grounded in data, not narratives. Peer-reviewed research increasingly shows that Bitcoin mining is becoming cleaner, more efficient, and more aligned with renewable energy development.As institutional adoption grows, understanding these realities may be critical to shaping informed policy and investment decisions.

9 Myths About Bitcoin’s Energy Use — Debunked With Real Data, Says ESG Expert

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9 Myths About Bitcoin’s Energy Use — Debunked With Real D...