Bitcoin’s mining difficulty is currently at 125.86 T, effective from block 935,429. The average block time is 9.47 minutes, slightly below Bitcoin’s 10-minute target. This indicates that the temporary drop in network hash power has accelerated block production. According to CoinWarz, the next difficulty adjustment on February 20, 2026, is projected to increase difficulty by about 5.63% to 132.96 T.

2021 China Mining Ban and Historical Comparison

The last time we saw a similar scenario was in May 2021, during the chaotic period when China banned mining operations. Bitcoin’s mining difficulty dropped between 12.6% and 27.9% from May to July 2021. At the same time, the market crashed, with Bitcoin’s price falling from a record over $125,000 to around $60,000. The ban forced a large portion of mining operations out of Asia, causing a significant decline in global hash power.

Winter Storm Disrupts U.S. Mining

In January, Winter Storm Fern hit the U.S., affecting 34 states across 2,000 square miles with snow, ice, and freezing temperatures. Power outages forced U.S.-based Bitcoin miners to temporarily reduce energy usage and halt operations. One of the world’s largest mining pools, Foundry USA, lost approximately 60% of its hash power during the storm, dropping from nearly 400 EH/s to 198 EH/s. Currently, Foundry USA has recovered to 354 EH/s, maintaining a 29.47% market share.

Are Miners Shifting to AI?

Another notable trend is that miners are not only affected by weather but also by strategic changes. Amid worsening market conditions, many large mining facilities are moving operations to AI data centers and high-performance computing (HPC) setups. Analysts say this is one of the main reasons for the sharp difficulty adjustment. The rising difficulty in the next period is expected to help maintain Bitcoin’s network security.

Recent difficulty fluctuations serve as important signals for investors. Temporary drops in mining activity and changes in global hash power due to weather can increase short-term Bitcoin volatility. Projections indicate that during the next adjustment on February 20, difficulty may rise by 5.63% to 132.96 T, assuming miners return to full capacity. Experts emphasize that restoring the operational power of large mining pools will ensure long-term network stability.

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Miner Stress and China Shutdowns

According to VanEck’s December 2025 ChainCheck report, over 400,000 mining machines in China’s Xinjiang province went offline. This removed an estimated 1.3 GW of capacity and reduced China’s computing power by around 100 exahashes within 24 hours. Analysts noted that this could account for about 10% of Bitcoin’s network hash rate.

Mining Economics Under Pressure

Bitcoin’s price dropped around 9% while volatility spiked, squeezing miners’ profitability. VanEck data shows that the electricity breakeven for a 2022 Bitmain S19 XP miner fell from $0.12 in December 2024 to $0.077 in mid-December 2025. Despite poor economics, many miners continue operations.

“While profitability for miners has been poor recently, many entities continue to mine despite periods of poor economics because they believe in Bitcoin’s future. To support the long-term hash rate of the Bitcoin network, we believe up to 13 nations are mining with support from their central governments.” – VanEck Analysts

Declining Hash Rate Historically Signals Gains

VanEck analysts emphasized that drops in hash rate have historically correlated with positive Bitcoin price performance. Since 2014, when hash rate declined, 90-day forward BTC returns were positive about 65% of the time. The 180-day forward returns averaged 20.5% during hash rate declines compared to 20.2% during increases. Technical and on-chain data suggest a potential recovery despite current pressure.

Price Update

According to Binance, Bitcoin was trading at $87,400 at the time of writing, down 1.77% in the past 24 hours.

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Malikie Innovations, which acquired over 32,000 patents from BlackBerry in 2023, has filed lawsuits against major Bitcoin mining firms Marathon Digital and Core Scientific. At the heart of the dispute lies elliptic curve cryptography (ECC), a core component of Bitcoin’s blockchain protocol.

Cryptography Under Scrutiny

According to Malikie, the ECC techniques used by Bitcoin are protected under patents they now hold. Their lawsuit claims that these mining companies have been infringing on their intellectual property by supporting Bitcoin operations with ECC-based methods.

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What’s more, Malikie seeks damages for up to six years of retroactive royalties. If awarded, the damages could be significant—possibly severe enough to force companies like Core Scientific into financial distress.

Could The Entire Network Be at Risk?

Experts suggest that a victory for Malikie might set a dangerous precedent. Other miners in the US could become targets, and the case could raise concerns over the legal stability of Bitcoin’s cryptographic foundation.

However, industry analysts like Niko Demchuk from AMLBot believe Malikie’s claims may not hold up. He suggests the patents in question may be expired or cover techniques predating Bitcoin’s implementation of ECC.

This is not the first intellectual property challenge in the crypto world. In the past, figures like Craig Wright have made failed attempts to claim ownership of Bitcoin’s underlying technologies. But this case serves as a reminder: even decentralized networks aren’t immune to centralized legal disputes.

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Saifedean Ammous Throws Support Behind Spam-Fighting Developer

Economist and author of The Bitcoin Standard, Saifedean Ammous, weighed in on the ongoing spam debate by offering to fund a developer dedicated to making Bitcoin spamming more difficult and expensive. “I’d throw in a few sats,” he wrote, signaling his willingness to contribute financially to efforts aimed at maintaining the network’s integrity.

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The comment came in response to a proposal by pseudonymous developer GrassFedBitcoin, who called for Bitcoin Core to adopt pull request #28408. This would allow node operators to filter out inscription-based spam more efficiently. According to GrassFedBitcoin, the lack of filtering tools contributes to unnecessary blockchain bloat and weakens Bitcoin’s function as a monetary protocol.

“Fighting Spam Is Not Censorship”

Ammous compared the issue to email spam—an arms race societies continue to fight without abandoning email altogether. He emphasized that rejecting spam transactions isn’t censorship, since node operators already reject invalid ones. His stance was clear: filtering inscriptions is not about control, it’s about protecting the network.

However, Blockstream CEO Adam Back pushed back, describing spam filtering as an endless technical war. He noted that spam data structures can be modified infinitely, requiring ever-evolving countermeasures. Yet even Back didn’t dispute the need to address the issue at some level.

Is Bitcoin’s Future at Risk?

The debate comes amid growing concerns that Bitcoin’s average block size could soar. A report by Mempool Research suggests inscription usage could push the average block to 4 MB—far above the current 1.5 MB—potentially leading to congestion and skyrocketing fees.

Ammous’s solution goes beyond policy: he suggests deprecating spam tools and even hiring outside coders to overwhelm systems designed to abuse the network. This marks a shift from ideological debate to direct action.

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Calacanis: “Time to Build a New Bitcoin”

Speaking to his 981,600 followers on X on March 14, Jason Calacanis said:

“Bitcoin has been a great game, but a few major players have taken over the market. It’s time to reset the game and build a better Bitcoin.”

Calacanis had also been an early investor in Robinhood and Keza, two Bitcoin-focused startups. Nevertheless, he claimed that Bitcoin, like all technologies, will eventually give way to new alternatives.

A New Opportunity for Bitcoin Layer-2 Projects!

In response to Calacanis’ remarks, many founders and executives of Bitcoin-focused initiatives emphasized that nothing can replace Bitcoin. However, they also highlighted the growing significance of layer-2 protocols built on the Bitcoin network.

Brady Swenson, co-founder of Swan Bitcoin, commented:

“Winning protocols aren’t replaced by something else; they are built upon.”

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Meanwhile, Cory Klippsten argued that Bitcoin is not just a technology but a revolution.

Lightspark CEO David Marcus also chimed in, saying Bitcoin’s functional gaps can be addressed through layer-2 solutions, adding:

“Trying to build a better Bitcoin is a fool’s errand.”

Bitcoin Gets Harder to Change as It Grows!

Many experts pointed out that Bitcoin’s massive network effect makes it increasingly powerful. While Muneeb Ali, one of the founders of Stacks, predicted that two-thirds of current Bitcoin layer-2 projects will disappear within three years, most agreed that Bitcoin itself cannot be replaced.

Bitcoin advocate Wayne Vaughan stated:

“People who see Bitcoin as just an asset or an application think it can easily be replaced, but Bitcoin is actually a network.”

Strive Funds CEO Matt Cole was even more direct:

“There will not be a better Bitcoin.”

This isn’t the first time Jason Calacanis has caused a stir in the crypto world. Back in 2020, he claimed that almost every crypto project globally was run by either “unqualified idiots” or “scammers.”

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What’s Driving This Significant Growth in Bitcoin’s Network?

Blockchain analytics platform IntoTheBlock reports that Bitcoin’s on-chain activity has experienced its largest spike since 2021. The rise in daily active addresses signals increasing interest from individual investors, a positive sign for Bitcoin’s long-term growth. Blockchain expert Anndy Lian noted that retail investors, compared to large whales, tend to have a stabilizing effect on the market, fostering more predictable price movements.

The increasing interest in Bitcoin reinforces trust in the network’s transaction capacity and efficiency. According to Glassnode data, Bitcoin’s transaction count grew by 15% in November, surpassing 4.5 million. This indicates not only rising retail engagement but also a growing influx of institutional participants.

How Are Investors Reacting to the Market Movements?

Bitcoin’s price saw a correction, falling to $92,400 on November 26. Bloomberg analyst Eric Balchunas attributed this dip to profit-taking by long-term investors. However, the impact of spot Bitcoin ETF redemptions on prices remains minimal. The market has also been volatile due to the high volume of leveraged positions, intensifying price swings.

Ryan Lee, Chief Analyst at Bitget Research, described the correction as a natural market reaction, urging investors to reassess their long-term strategies. He also highlighted the risk of liquidation, with over $3.4 billion in leveraged positions at stake.

Rising User Activity Signals New Highs for Bitcoin

IntoTheBlock data reveals that 458,000 Bitcoin addresses accumulated 344,000 BTC, forming a strong foundation for further price growth. Isaac Joshua, CEO of Gems Blockchain Launchpad, stated that for Bitcoin to reach the $100,000 mark, it would require approximately $500 billion in capital inflows. However, considering Bitcoin’s rising adoption and status in global financial markets, this target appears achievable.

Are ETFs Driving Increased Network Usage?

Interest in Bitcoin ETFs is playing a pivotal role in this surge. In the final week of November, Bitcoin ETFs recorded $2.4 billion in inflows, marking the fourth-best week in their history. Meanwhile, over $2 billion exited China-based ETFs, testing Bitcoin’s resilience in global financial markets.

According to CoinShares data, growing interest in Bitcoin ETFs reflects a shift in how investors perceive Bitcoin—as a hedge against inflation and economic uncertainty. This changing sentiment is bolstering the asset’s appeal as a store of value, further solidifying its position in the financial landscape.

Looking Ahead

Bitcoin’s network growth and rising adoption are clear indicators of its potential to achieve new milestones. With increasing retail and institutional participation, coupled with a robust foundation of active addresses and ETF inflows, Bitcoin’s march toward $100,000 seems not just possible but inevitable in the long run.

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