Raevenlord
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Even as the price of Bitcoin and cryptocurrency in general tumbled some 60% in as many months, miners don't seem to be winding down their efforts at all. In fact, in what could be seen as a doubling-down in the value of crypto, miners have been seemingly investing in both more powerful and more power-efficient rigs. While mining rig prices too have tumbled along with crypto prices, these aren't small investments at all. Yet according to JPMorgan, they have allowed miners to decrease the average cost of mining a single Bitcoin down to $13,000 from its $24,000 average just a month ago.
The $13,000 figure is the lowest since September 2021. Remember that Bitcoin mining costs are affected not just by energy prices, but also by the amount of hash power available to the network, which automatically changes its mining difficulty to cater to higher (or lower) miner demand. And as energy prices have increased, miners have been taking less power-efficient rigs offline, which would cut into their profits - explaining the reduction in overall hash rate.
According to Bloomberg, lower Bitcoin production costs can potentially ease miner selling pressure by improving profitability. Bloomberg did also say that in a bear market, lowered production costs might also lower the ceiling price at which miners are willing to sell their Bitcoin, thus potentially driving Bitcoin price lower.
Interestingly, $13,000 is the same price bottom that analysts say Bitcoin could be expected to hit, considering its historic drops of 80%+ from All Time High (ATH) achieved in each of the precious bull markets. At the moment, Bitcoin's price of $20,715 represents a 70% drop from its previous ATH in November 2021.
Even with these investments, however, Bitcoin miners are reeling from one of the lowest profitability ratios of all time, as energy prices and falling Bitcoin cost have sunken their teeth in the amount of profit available for takers. Bitinfocharts reports that mining profitability is currently at its lowest levels since October 2020 at a (comparatively measly) $0.095 per day per terahashes per second. Yet most Bitcoin miners would tell you that profits only materialize when they sell - and with some analysts expecting Bitcoin pricing to explode to $100,000 in the next couple of years, miners might just be willing to play that long a game.
View at TechPowerUp Main Site | Source
The $13,000 figure is the lowest since September 2021. Remember that Bitcoin mining costs are affected not just by energy prices, but also by the amount of hash power available to the network, which automatically changes its mining difficulty to cater to higher (or lower) miner demand. And as energy prices have increased, miners have been taking less power-efficient rigs offline, which would cut into their profits - explaining the reduction in overall hash rate.
According to Bloomberg, lower Bitcoin production costs can potentially ease miner selling pressure by improving profitability. Bloomberg did also say that in a bear market, lowered production costs might also lower the ceiling price at which miners are willing to sell their Bitcoin, thus potentially driving Bitcoin price lower.
Interestingly, $13,000 is the same price bottom that analysts say Bitcoin could be expected to hit, considering its historic drops of 80%+ from All Time High (ATH) achieved in each of the precious bull markets. At the moment, Bitcoin's price of $20,715 represents a 70% drop from its previous ATH in November 2021.
Even with these investments, however, Bitcoin miners are reeling from one of the lowest profitability ratios of all time, as energy prices and falling Bitcoin cost have sunken their teeth in the amount of profit available for takers. Bitinfocharts reports that mining profitability is currently at its lowest levels since October 2020 at a (comparatively measly) $0.095 per day per terahashes per second. Yet most Bitcoin miners would tell you that profits only materialize when they sell - and with some analysts expecting Bitcoin pricing to explode to $100,000 in the next couple of years, miners might just be willing to play that long a game.
View at TechPowerUp Main Site | Source
