New Report Finds 80% of Bitcoin Mining Running on Renewable Energy
Average Miner ‘Running At A Loss’
In a ‘whitepaper’ which received high praise from cryptocurrency figures, CoinShares examined various facets of mining, which has seen increased prominence in recent weeks as Bitcoin price 00 dropped to lows of $3500.
“Among our findings is an estimate that since May, the market-average, all-in marginal cost of creation, at ¢5/KWh, and 18-month depreciation schedules has increased from approximately $6,500 to approximately $6,800,” researchers reveal in their introduction.
This suggests that, at current prices, the average miner is either: running at a loss and unable to recover capex, mining at electricity costs closer to ¢3/KWh, depreciating mining gear over 24-30 months, or paying less for mining gear than our estimates.
Bitcoin Mining is 80 Percent On Renewables
As reported, miners have appeared to experience considerable economic difficulties due to price depreciation regardless of the base price of electricity in their location.
Scenes allegedly showing Chinese miners dumping unprofitable units en masse hit social media last week, amid claims the dry season had pushed up hydroelectricity costs which were adding to miners’ headache.
The Bitcoin mining difficulty is set to decrease, not increase, for the first time since December 2, 2011.
Going forward, CoinShares says, mining will continue to focus on the cheapest possible sources of mostly renewable energy.
“Based on historical data on energy mix and locations of cryptocurrency mining operations in China, we have shown that contrary to the common narrative, the vast majority of global Bitcoin mining capacity (minimum 77.6%) is running on renewable energy,” the researchers conclude.
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