Bitcoin & Cryptocurrency Mining Costs: A blog about the cost of mining bitcoins.
Bitcoin Mining is a peer-to-peer computer process used to secure and verify bitcoin transactions—payments from one user to another on a decentralized network. Mining involves adding bitcoin transaction data to Bitcoin’s global public ledger of past transactions. Each group of transactions is called a block. Blocks are secured by Bitcoin miners and build on top of each other forming a chain. This ledger of past transactions is called the blockchain. The blockchain serves to confirm transactions to the rest of the network as having taken place. Bitcoin nodes use the blockchain to distinguish legitimate Bitcoin transactions from attempts to re-spend coins that have already been spent elsewhere.
Mining is intentionally designed to be resource-intensive and difficult so that the number of blocks found each day by miners remains steady. Individual blocks must contain a proof of work to be considered valid. This proof of work is verified by other Bitcoin nodes each time they receive a block. Bitcoin uses the hashcash proof-of-work function.
The primary purpose of mining is to allow Bitcoin nodes to reach a secure, tamper-resistant consensus. Mining is also the mechanism used to introduce Bitcoins into the system: Miners are paid any transaction
CryptoCoinsNews.comBitcoin & Cryptocurrency Mining Costs: A blog about the cost of mining bitcoins.
The market capitalization of bitcoin is approaching $3 billion. The total market cap for all cryptocurrencies has surpassed $5 billion and is quickly approaching $6 billion, according to cryptocurrency data site CoinMarketCap.com. Bitcoin is currently the king of the cryptocurrency jungle and could easily be worth $10 billion or more in the not too distant future.
Bitcoin & Cryptocurrency Mining Costs: The most expensive lesson
There was a time where one could profitably mine Bitcoin with GPUs, but again…today, you really must have an ASIC and a deal witha power company to make any money mining Bitcoin in 2019.
As I said in 2013, “Terahash Technologies is a trade name for a growing group of individuals and organizations developing custom ASIC-based mining solutions that combine the latest VLSI chip design techniques, advanced printed circuit board design, and low-power high-speed FPGA design to produce new generations of cryptocurrency mining equipment.
As I write this the cryptocurrency market capitalization is approaching $300 Billion Dollars. In Jan 2017 it was less than $20 Billion. Today the hash rate (computing power being used to mine) equals almost 500 Exahashes per second, or 80 times more computing power than the entire world’s top 500 supercomputers combined.”
So, as I’ve said many times before: “Bitcoin is at best a speculative investment and you should not bet the farm on it. You should only invest as much as you can afford to lose.”
Mining is no longer profitable unless you have very cheap electricity (or live in Venezuela).
Now that we’ve
This is a blog about the cost of mining bitcoins. I started it in 2013 under the name BitcoinCharts and switched to the current domain in 2015. The page contains some affiliate links like those to Amazon and eBay. You can use those if you want to order something there; I’ll get a small referral fee which helps pay for the hosting costs. Thanks!
The Bitcoin Energy Consumption Index was created to provide insight into this amount, and raise awareness on the unsustainability of the proof-of-work algorithm.
The Bitcoin Energy Consumption Index is the first real-time estimate of the energy consumed by the Bitcoin network, but certainly not the first. A list of articles that have focussed on this subject in the past are featured below.
This index is based on a forward-looking analysis of various drivers that impact electricity consumption such as machine-learning models and publicly available data sets. The current model estimates that miners will spend 60% of their revenues on electricity expenses.
The Cost of Mining a Bitcoin
As a thought experiment, imagine there was a base metal as scarce as gold but with the following properties: ordinary people can mine it with simple hand tools; it only has one use (as money), so it is not consumed; it can be transported across oceans and through mountain ranges easily; an ounce fits in your pocket; it would be easy to verify that it was mined in an environmentally friendly way; and you could trade a piece of paper representing an ounce for a nice house or a luxury car.
Assume further that its supply would expand at a steady rate, in line with Moore’s Law, such that
Name Price Price (BTC) Market Cap 24h Volume Available Supply Total Supply Change(24hrs) Price Graph (7d)
Bitcoin BTC $ 8,769.86 0.00164174 $ 151,196,903,516 $ 17,082,844,549 17,145,125 BTC 21,000,000 BTC 4.99%
Ethereum ETH $ 157.33 0.02912700 $ 16,668,543,913 $ 6,876,572,364 105,423,067 ETH 112,200,540 ETH 1.59%
XRP XRP $ 0.24 0.00004349 $ 10,264,471,492 $ 1,117,866,578 43.68 billion XRP 100 billion XRP 2.53%
Tether USDT ฿ 1.00 0.00018523 $ 4,012,785,176 $ 22,183,837 3.99 billion USDT 4 billion USDT -0.26%
Bitcoin Cash BCH $ 252.92 0.04652042 $ 4497276038 $ 11891895