No, the difficulty is based on the average rate of generation of blocks over the last few weeks.
If people put less computational power into generating blocks, fewer blocks will be generated. After each n blocks, nodes adjust their difficulty based on how long it took to generate those blocks, to try and achieve an average of a block every 10 minutes.
But how much computational power people are willing to put in depends on price. It only makes sense to mine if you get more out than you put in in the cost of buying the hardware, amortized over the life of the hardware, plus the cost of the power used in mining. If the price of Bitcoin drops, there are fewer people for whom it makes economic sense to continue mining, so some will turn off their miners, reducing the hash rate.
When global hash rate reduces like this, and the difficulty drops, then the people remaining will get more BTC per unit time from mining, so it can make economic sense for them to continue mining, as long as the price doesn't drop further. So indirectly, the total hash power of the bitcoin network is linked to the price of bitcoin; or, the price of bitcoin relative to the price of electric power.
If people put less computational power into generating blocks, fewer blocks will be generated. After each n blocks, nodes adjust their difficulty based on how long it took to generate those blocks, to try and achieve an average of a block every 10 minutes.
But how much computational power people are willing to put in depends on price. It only makes sense to mine if you get more out than you put in in the cost of buying the hardware, amortized over the life of the hardware, plus the cost of the power used in mining. If the price of Bitcoin drops, there are fewer people for whom it makes economic sense to continue mining, so some will turn off their miners, reducing the hash rate.
When global hash rate reduces like this, and the difficulty drops, then the people remaining will get more BTC per unit time from mining, so it can make economic sense for them to continue mining, as long as the price doesn't drop further. So indirectly, the total hash power of the bitcoin network is linked to the price of bitcoin; or, the price of bitcoin relative to the price of electric power.