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It costs an average of ~5k USD to mine one bitcoin. Meaning even if the value drops at exchanges, no miner will sell below this value due to not breaking even o

It costs an average of ~5k USD to mine one bitcoin. Meaning even if the value drops at exchanges, no miner will sell below this value due to not breaking even on electricity. That's why also bitcoin miners go to places where electricity cost is low, and why they undervoltage their mining cards.

petters 4y ago
What cards? Bitcoin has not been mined on GPUs for a long time and I would have thought that the ASICs used were already optimal.
- thinkmassive 4y ago
  ASICs are also populated onto cards, and miner firmware handles tuning the hash rate of each chip (or card) based on inputs like desired temperature and power consumption. These inputs are often adjustable. Heat causes chips and other components to degrade, so not everyone runs their miners at maximum output all the time.
exo762 4y ago
Why does it make any difference for me (a hypothetical BTC holder) how BTC is minted? > Meaning even if the value drops at exchanges, no miner will sell below this value due to not breaking even on electricity. It does not work like that. If you need to pay your bills you will sell BTC for whatever price it is right now. Unless you want to long BTC, but that's a different story.
stale2002 4y ago
> Meaning even if the value drops at exchanges, no miner will sell below this value due to not breaking even on electricity You have causation reversed here. It is not that bitcoin would not sell/be worth less than the amount to mine it. Instead, it is that it wouldn't be mined if it were worth less than the cost to mine it. At which point, miners would drop out, and the cost to mine it would reduce, as the difficulty goes down.
SilasX 4y ago
Wait, really? It only costs $5k to mine one when they sell for $21k?
- unnouinceput 4y ago
  I meant electricity cost, on average, is ~ 5k USD. I didn't factor anything else, like cost of hardware, rent/location, living expenses etc.

petters 4y ago

What cards? Bitcoin has not been mined on GPUs for a long time and I would have thought that the ASICs used were already optimal.

thinkmassive 4y ago
ASICs are also populated onto cards, and miner firmware handles tuning the hash rate of each chip (or card) based on inputs like desired temperature and power consumption. These inputs are often adjustable. Heat causes chips and other components to degrade, so not everyone runs their miners at maximum output all the time.

exo762 4y ago

Why does it make any difference for me (a hypothetical BTC holder) how BTC is minted? > Meaning even if the value drops at exchanges, no miner will sell below this value due to not breaking even on electricity. It does not work like that. If you need to pay your bills you will sell BTC for whatever price it is right now. Unless you want to long BTC, but that's a different story.

stale2002 4y ago

> Meaning even if the value drops at exchanges, no miner will sell below this value due to not breaking even on electricity You have causation reversed here. It is not that bitcoin would not sell/be worth less than the amount to mine it. Instead, it is that it wouldn't be mined if it were worth less than the cost to mine it. At which point, miners would drop out, and the cost to mine it would reduce, as the difficulty goes down.

SilasX 4y ago

Wait, really? It only costs $5k to mine one when they sell for $21k?

unnouinceput 4y ago
I meant electricity cost, on average, is ~ 5k USD. I didn't factor anything else, like cost of hardware, rent/location, living expenses etc.