3 ms·
Basically correct, except that it isn't the price of Bitcoin or Ethereum that matters, per se, but rather the value of the reward for each block relative to the
by nybble41 7y ago
Basically correct, except that it isn't the price of Bitcoin or Ethereum that matters, per se, but rather the value of the reward for each block relative to the amount of time required to mine it. For Bitcoin, ignoring transaction fees, the rate is 12.5 bitcoins per 10 minutes; for Ethereum it's 3 ETH per 15 seconds. If the price of 1 BTC is 70x the price of 1 ETH then you would break even expending about 7.3x over a given interval to mine 12.5 BTC vs. 1x to mine 120 ETH. If you spent 70x, however, you'd soon be bankrupt despite the higher BTC price, because you don't earn 70x the value.
- im3w1l 7y agoSo energy usage should drop quite a bit after some difficulty increases?
- nybble41 7y agoThe difficulty increases or decreases to maintain the target block interval. The only way that impacts mining revenue is if the actual block interval deviates significantly from the target—for example, if the hash rate suddenly increased such that blocks were being solved in five minutes instead of ten, that would double the revenue rate (and thus the economical power consumption) temporarily until a difficulty increase brought the interval back to ten minutes per block. What does cause significant changes in revenue is the periodic halving of the block reward. Absent an opposing increase in price and/or transaction fees, when the reward drops from 12.5 BTC/block to 6.25 BTC/block in May of this year the energy budget for profitable mining should be cut roughly in half.
- im3w1l 7y agoSorry yeah I was mixing those up. But is it going to use not-obscene amounts of electricity eventually?