Bitcoin Mining Difficulty Rises 15% After U.S. Winter Storm Disruptions
Difficulty climbs to 144.4 trillion on Feb. 20, reversing an 11 % drop linked to a sharp hash‑rate fall during the January storms.
Summary
- Difficulty jump: 144.4 trillion (+≈15 %) as of Feb. 20, per CoinWarz data.
- Hash‑rate rebound: The network’s total computing power recovered after a temporary dip caused by severe winter storms that knocked out large segments of U.S. mining capacity.
- Margin pressure: Higher difficulty improves network security but tightens profit margins for miners already grappling with rising electricity and equipment costs.
- U.S. miners’ response: Many operators capitalised on demand‑response programs, curtailing mining and selling excess power back to the grid during the storm‑induced curtailments.
What happened?
In late January, a series of severe winter storms swept across the United States, causing widespread power‑grid interruptions. The outages forced a substantial portion of the country’s Bitcoin miners offline, triggering a steep decline in the network’s hash rate. Data from the Cambridge Centre for Alternative Finance shows that the United States now contributes over one‑third of global hashing power, so the regional disturbance had a noticeable impact on the Bitcoin network as a whole.
The most visible symptom was a fall in mining difficulty of roughly 11 % earlier this month—the sharpest decline since China’s 2021 mining ban. Mining difficulty, which is automatically adjusted every 2,016 blocks (about every two weeks), fell in tandem with the hash‑rate drop, reflecting the reduced computational work needed to find new blocks.
By mid‑February, miners in the affected regions had largely restored operations. As hash rate climbed back toward pre‑storm levels, the difficulty algorithm responded with a 15 % upward adjustment, lifting the metric to 144.4 trillion. The adjustment restores the intended 10‑minute block‑production target and reinforces the security of the Bitcoin blockchain.
How miners turned a disruption into revenue
Although the storms forced many rigs to shut down, several U.S. operators mitigated the financial hit by participating in demand‑response or “curtailment” programs. These arrangements let miners temporarily pause their equipment when the grid is strained and, in exchange, sell the contracted electricity back to utilities at premium rates.
- LM Funding America reported that during “Winter Storm Fern” it curtailed a portion of its power use and redirected the electricity to the grid, generating more than 25 % of its typical quarterly energy‑curtailment revenue over a single weekend.
- Canaan Inc., a Singapore‑based hardware manufacturer with U.S. mining sites, similarly coordinated curtailments with local partners, helping to balance grid demand while maintaining some operational income.
Such flexibility illustrates how large‑scale miners can embed electricity‑market dynamics into their business models, turning grid stress events into short‑term profit opportunities.
Wider implications for the mining ecosystem
The difficulty surge carries mixed signals for the broader mining community:
| Impact | Detail |
|---|---|
| Network security | Higher difficulty means more hashing power is required to succeed, reinforcing the chain’s resistance to attacks. |
| Profitability | Miners face increased computational work per block, which can erode margins, especially for operations with relatively high electricity costs. |
| Equipment demand | A tighter margin environment may accelerate the adoption of more efficient ASICs, as miners seek to lower per‑hash electricity consumption. |
| Geographic concentration | The episode underscores the United States’ role as the world’s largest mining hub post‑China crackdown, with over one‑third of global hash rate now residing in U.S. jurisdictions such as Texas and Georgia. |
Key Takeaways
- Difficulty correction: The 15 % rise in mining difficulty is a direct response to the hash‑rate recovery after the January winter storms, signalling a return to normal network operation.
- Profit squeeze: Higher difficulty will increase the cost of block production, pressuring miners already dealing with elevated electricity prices and supply‑chain constraints.
- Strategic curtailments: U.S. miners demonstrated that demand‑response participation can offset revenue losses during grid outages, turning a disruptive event into a short‑term cash flow boost.
- U.S. dominance continues: With the United States now accounting for more than a third of global hash rate, future regional power‑grid events will have outsized effects on global Bitcoin mining dynamics.
Data sources: CoinWarz difficulty chart, Cambridge Centre for Alternative Finance hash‑rate map, LM Funding America January 2026 operational update, Canaan Inc. January production bulletin.
The article follows Cointelegraph’s editorial guidelines and aims to provide accurate, neutral reporting for the cryptocurrency community.
Source: https://cointelegraph.com/news/bitcoin-difficulty-rebounds-15-as-us-miners-recover-from-winter-outages?utm_source=rss_feed&utm_medium=feed&utm_campaign=rss_partner_inbound
