Add Dynamic Difficulty Adjustment Mechanism to Improve Network Stability

[anshulchikhale30-p]

Problem

Currently, the Proof-of-Work implementation uses a fixed mining difficulty.
This can lead to instability in block production time when:

• Mining power increases → blocks are produced too quickly
• Mining power decreases → blocks are produced too slowly

As a result:

• Block time becomes inconsistent
• Network security assumptions may weaken
• The chain may grow too fast or stall

A fixed difficulty does not reflect real-world blockchain behavior.

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Why This Is Important

Dynamic difficulty adjustment is a fundamental mechanism in blockchain systems (e.g., Bitcoin, Ethereum PoW) because it:

• Maintains a stable target block time
• Adapts to changes in total hash power
• Prevents runaway block production
• Preserves network predictability and fairness
• Improves consensus robustness

Without adjustment, the system becomes sensitive to mining power fluctuations.

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Proposed Solution

Introduce a new module:

consensus/difficulty.py

This module will:

• Calculate new difficulty every N blocks
• Use average block production time
• Compare actual time vs expected target time
• Apply bounded adjustment to prevent extreme jumps
• Maintain a minimum difficulty threshold

The adjustment logic will remain deterministic and independent of network state.

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Expected Outcome

• Stable block production time
• Improved consensus reliability
• More realistic blockchain behavior
• Better research value of MiniChain

Code of Conduct

• I have joined the Discord server and will post updates there
• I have searched existing issues to avoid duplicates