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"as far as I can tell, mining is currently unprofitable with any reasonable cost of electricity." I have been mining for 3.5 years. This statement is utterly f
by mrb 13y ago
"as far as I can tell, mining is currently unprofitable with any reasonable cost of electricity."
I have been mining for 3.5 years. This statement is utterly false. Current mining hardware, such as the KnC Jupiter, can mine at about 500 Ghash/s at less than 600 Watt at the wall. Over a month it mines:
500e9 (hash/sec) * 3600 (sec/hour) * 731 (hour/month) / (2^32 * 8.0e9 (current difficulty)) * 25 (btc/block) * 400 ($/btc) = $383
And assuming worldwide average electricity costs of $0.10/kWh, it costs less than $44 to run over a month:
.6 (kW) * 731 (hour/month) * .10 ($/kWh) = $44
Even assuming higher prices (eg. highest-tier electricity prices in SoCal of ~$0.30/kWh), and even adding overhead like cooling, etc, it is still clearly profitable to mine with the Jupiter.
(However difficulty is rising pretty quickly, so it will certainly not remain that profitable, if at all, in the near future.)
- wmf 13y agoThat's marginally profitable, but if it never pays back the capex it's not actually profitable.
- driverdan 13y agoYou're completely ignoring the capital cost of buying the miner.
- mrb 13y agoTrue, but this is not Altman's point. He clearly refers to operating costs, not capital costs. (This is why he later talks about free electricity, not free hardware.)
- LyndsySimon 13y agoThat's a sunk cost. The question wasn't "is it profitable to begin mining Bitcoin?", it was "is it profitable to mine Bitcoin?" Miners already have the equipment - as long as proceeds don't drop below energy costs, mining will continue at current levels.
- dragonwriter 13y ago> Miners already have the equipment - as long as proceeds don't drop below energy costs, mining will continue at current levels. Doesn't that assume that mining equipment has infinite useful life?