Bitcoin Forum

hello, dear miners
mining difficulty and hash rate -  should I care about it as a trader?
if I should care about it, can you please explain why? how and both of them affect the cryptocurrencies price?

I don't think so (unless there is a major jump ... signaling something went wrong). I consider the user adoption as the major price mover.

common sense says:
Rising diff. brings higher mining costs. Miners needs to use more energy (hashrate) or time to find a block ... thus getting less coins thus should be selling them at higher price.
Rising hashrate means there is going to be mined more coins thus price could be dropping ...  on the other hand the rising hashrate also brings bigger diff. jump in next period.
(but we all know the common sense and market moves are not usually hand in hand)

I'm curious about other members opinions.

You do not have anything to worry about as a trader since it does not affect your trading activity in anyway. It is only important to miners, so I won't need to give you details what difficulty and hash rate is all about.

However, if you want to learn for the sake of knowledge, these links might be helpful;
https://en.bitcoin.it/wiki/Difficulty
https://www.buybitcoinworldwide.com/definitions/

As a trader, you don't really need to care, all that matter is the price of bitcoin that you were traded. But, just for your information, there will be difficulty adjustment every 2000 blocks(?), if the hash rate significantly dropped, same goes for the difficulty, making the speed of confirmation not affected by the hash rate. if the hash rate increasing, the difficulty also increases, it's all already planned from the start to solve that problem.
By the way, hard to say that difficulty and hash rate have some kind of relation to the bitcoin price, but maybe, if the difficulty is awkwardly so high, bitcoin will become more valuable.

You don't need to know the in-depth mechanics, but you should at least study the overview and the potential consequences. As a trader, you're going to need a general idea of all the variables involved.

Yuo should not care about that because you just do buy and sell, that will not give an impact for you. That just affecting the network but not to the price of altcoin. I think you must forget it and just do your job as a trade.

Not really. These things do not really affect the price of bitcoin much, since it only relates to the mining aspects of bitcoin, though if difficulty and hashrate rises by more than 10% in one adjustment then maybe you should take a position accordingly.

If you just have an interest in how bitcoin is performing and how much hashrate is dedicated to bitcoin, then yeah. But especially for short term trading, these statistics are irrelevant.

as an experience trader everything is a clue,
it was like a piece of puzzle,and you need to gather it in order to read or see the picture.
because you can not read the market if you can not find a clue from everything.
in general,difficulty and hash rate only showing how much it will be when you mine it,
but as a trader we should can see the miners sentiment based on that,
for example;
difficulty significantly drop with hash rate due to ban by chinese goverment.
decresead almost half of it,
which mean the miners stopping their activity and because of that something big will happen.
most miners is a holders unlike us traders,when that time happen.a big dump will happen for sure and after that another decline will happen.

Loosely speaking you don't need to pay much attention to it, however if there are big changes to difficulty or required hash rate then this logically could have knock on effects to the price

There is no need to think much about difficulty and hash rate. Difficulty increases after every four year to limit the supply of Bitcoin per year. This helps in increasing the price, since demand is getting bigger with time and on the other hand supply is decreasing with time. But you need not to keep a check of that as you will easily know about it when halving is approaching. Regarding hash rate, you as a trader shouldn't be much concerned with. China is dominating the market with 70% of network hashrate. Thus, hashrate will only gonna come in picture if something major with Chinese mining farm happens. Difficulty only has impact in long term and shouldn't be of much concern.

As a trader you should only care about graphs, you know, volumen, liquidity... latest news, etc etc... even with all those things in consideration you will never be "safe" :P


IMHO you should be happy to see how it ATM: Hash Rate:   7,942,844,887 GH/s is growing week by week, so as i said don't worry too much about it ;)

Trader's job is just to monitor the charts and the value of either bitcoin or altcoins they are trading. Difficulty and hash rate is not for you and you can gladly leave that for the miners to worry themselves about. Just keep being optimistic with your trade and keep praying for more difficulty if you know what I mean. ;D

Yes, other than regulation and government's stand on mining industry, a trader does not need to care anything which are related to mining industry as far as I know. (please correct me if I am wrong).

No, you needn't worry about it. The only (outlandish) scenario is when the hash rate starts dropping so low that the probability of a 51% attack becomes non-negligible. Then the price might crash. Given how the hashing power and difficulty keeps increasing, you needn't worry about that happening now.