How much should bitcoin cost so that mining again becomes profitable?
A 70% drop in the price of bitcoin from the middle of December practically reduced the profitability of mining. With today’s price level, falling to a minimum of $ 6,048, only the largest miners can stay afloat. But the analysis of Bloomberg shows that even among the major players not all can survive.
Today, 67% of the mining-energy is concentrated in the hands of four pools: BTC.com, AntPool, SlushPool and BTC.top. But Bloomberg analyst Tim Kulpan asserts: “If you are not the company that manages the fastest mining installations purchased at wholesale prices, then most likely you are losing money.” December’s rise increased the mining market by 40%, which led to an imbalance of the system: according to Blockchain.info, it was 51% harder to extract the block.
Has grown both the complexity of calculations and the amount of energy consumed. If bitcoin stopped at a 50-day moving average of $ 13,200, then with the current complexity and number of hashes, the average miner with good equipment would receive $ 80 per week (but the older the equipment, the lower the profit). However, even the most advanced bitcoin-mining installations do not protect against the risk of losing funds, when the price drops sharply, and the miner stays in the network: the miners suffer losses starting at a price point of $ 6,800.
If the price does not rise, then the average miner will lose $ 3 per week. Mining pools, such as AntPool, can remain in positive territory, but their profit will be 90% lower than with a 50-day moving average of $ 13,200.
Tim Kulpan modeled the only, in his opinion, situation, in which the mining will again become profitable: the growth of bitcoin with the mandatory release of a part of the miners from the game in order to reduce competition. The analyst is sure that all today’s participants will not be able to avoid losses: either someone will free “the mining ship” from its weight, or everyone will drown.
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Author: Richard Abermann