Bitcoin's mining difficulty has fallen 18.5% from its peak, marking the largest such decline since the 2021 China ban crackdown, according to data from Galaxy Research. The drop is a direct result of a steep market downturn that has pushed Bitcoin's price down by over 50% from its all-time high of $126,198 in October 2025 to around $62,000.
This has forced many miners—especially those relying on older, less efficient rigs—to shut down operations amid high energy costs. Some operators have even redirected resources toward artificial intelligence, attracted by stable contracts and favorable terms offered by major tech firms. The resulting decline in active mining machines caused the network's hashrate to tumble, triggering the difficulty adjustment.
Galaxy Research noted that the current difficulty drawdown is significantly smaller than the 45% drop during the 2021 China ban and the 32% decrease during the 2018 bear market. Bitcoin's automatic difficulty adjustment is designed to maintain a roughly 10-minute block time regardless of hashrate fluctuations, ensuring network stability.
The broader crypto market faced additional headwinds Friday as AI stocks declined, dampening sentiment. Bitcoin fell below its 50-day simple moving average of $63,899, slipping 1.93% in 24 hours to $63,133 while weekly losses reached 1.83%. Total crypto market volume rose about 9% to $172.44 billion, while open interest remained steady at $111 billion, with Bitcoin's open interest inching up 0.02% to $47.85 billion.
