What Happens to Miner Revenue When Difficulty Increases Sharply?

When difficulty increases sharply, the competition for the fixed block reward intensifies, leading to a decrease in the probability of any single miner finding the block. This immediately reduces the miner's expected revenue, assuming their hash rate and the cryptocurrency's price remain constant.

To maintain profitability, the miner must either upgrade hardware for higher efficiency or rely on an increase in the cryptocurrency's market price.