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block difficulty

Chart notes:

  • Green area: Chain's current block difficulty factor;
  • Blue line: Average monthly % change in block difficulty factor.

block difficulty explained

If you're just learning about the blockchain industry, hashing power and node count are probably the two most important network topics to wrap your head around. Block difficulty is more abstract. Generally, the block "difficulty" is a metric that continuously re-calculates and adjusts after a certain number of blocks are created in the blockchain (in Bitcoin's case, this is every 2,016 blocks, or about every two weeks).

The higher the hashing power being thrown at the network, the more difficult the process of solving math problems becomes (a process more like a lottery) for miners on the network—making it harder for them to earn the block reward. Accordingly, if less miners participate in the network (for market or other reasons), the block difficulty can adjust downward as well, and become less difficult.

A positive (above 0%) trend in the block difficulty re-adjustment, or change in difficulty (right axis above), typically reflects a growing blockchain network. Note that, regardless of how often the block difficulty recalculates across the various networks graphed, the blue line (right axis) is displaying a smoothed, 30-day average change in difficulty, for easier viewing.

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