Bitcoin Mining Difficulty Surges Amid Institutional Investment

According to Cointelegraph, Bitcoin mining difficulty has surged by 378% over the past three years, driven by significant institutional investment in large-scale mining operations. This increase has led to heightened competition and entry barriers for individual miners. However, Ki Young Ju, CEO of CryptoQuant, predicts that this could be beneficial for Bitcoin (BTC) in the long run. Ju forecasts that the rise in mining difficulty could signal Bitcoin's evolution into a stable currency by 2030. As institutional dominance grows, Ju believes it could reduce volatility in the cryptocurrency market. Historically, Bitcoin and the broader cryptocurrency market have been known for their volatility, making them more speculative than stable. The growing involvement of institutional investors has raised mining difficulty due to the centralization of computing power, but Ju suggests this could help stabilize the Bitcoin ecosystem. In a recent post, Ju stated that major fintech players are expected to drive mass adoption of stablecoins within three years. He anticipates that by the next halving event in 2028, the use of BTC as a currency will start to be seriously discussed. While layer-2 solutions like the Lightning Network have been touted as the key to BTC’s scalability, adoption rates have lagged behind venture capital (VC)-backed blockchains. Ju believes institutional support is critical for adopting BTC L2s, which face competition from alternative solutions like Wrapped Bitcoin (WBTC). WBTC integrates BTC into various ecosystems without the complexities of L2 infrastructure. BTC price analysis indicates that the $65,000 price level has become a crucial support after the cryptocurrency’s price reached $69,000 on Oct. 21 for the first time since June. Keith Alan, co-founder of Material Indicators, predicted that if the BTC price can hold above the 21-week moving average with no wicks, it would signal that the short-term uptrend is here to stay. With macroeconomic data and anticipated market volatility, BTC performance in the coming weeks will be closely monitored by analysts, with some predicting an all-time high retest before the year is out.