Topic: Mining Hashrate and Power Analysis | BitOoda Research (Read 148 times)

I will try to summarize some of the information provided by Fidelity Center for Applied Technology (FCAT) to provide more data and analysis on Bitcoin mining Read it here ---> Bitcoin Power Analysis Hashrate Implications and Miner Economics.


Section I: Bitcoin Power Capacity Analysis: How much, where, and at what price

It has been estimated that the Bitcoin mining industry has access to at least 9.6 GW of power, assuming that all of the Hashrate that remained on the May 17 trough was among the most profitable new generation of mining platforms - the "S17 Class*" and all devices that were shut down between May 10 - May 17th were from the older generation, and the "S9-class*"  less profitable machines.

We also assume a PUE (Power Usage Effectiveness) of 1.12 across all relevant calculations, which means that for every 1MW used to directly mine Bitcoin, another 120kw is used to run everything else, including cooling systems, lighting, servers, switches, etc.




We assess that the BTC mining industry utilizes ~67% of 9.6GW available power capacity, growing at ~10% per annum, powering 2.8mm dedicated Bitcoin mining rigs.

Estimated mining capacity is roughly 50% in China, with the US accounting for another 14%, then Canda, russian,..etc




In our assessment, 50% of Bitcoin mining capacity pays 3c or less per kWh. it means lower revenues, and consequently, miners who have high energy costs turn either to lower energy cost areas or shut down.




Thus, the average monetary cost of 1 BTC mining is around $ 5,000, with a maximum confidence of approximately $ 6000, without other expenses, depreciation, and other costs.
However, there is a small percentage of bitcoin that is extracted at a higher cost of cash than the current price of bitcoin, and a minimum of $ 14,000, and perhaps the reasons that drive them to continue are energy purchase obligations, among others.



We note that the S9 class needs less than 2c/kWh to reach even in the current Hashrate network, and it is likely that you will need lower energy prices in order to remain sustainable while Hashrate continues to increase.
If mining with S9 class rigs, it would take about 70 devices and over 100kW, and correspondingly more maintenance and operations labor cost and power overhead to generate the same 1PH/s of Hashrate




Section II: Some surprising conclusions on the relationship between Hashrate growth and China’s flood season

The Southwestern provinces of Sichuan and Yunnan face heavy rain from May to October, causing an increase in hydropower production during this time and thus selling at cheaper prices (Where it is paid about 1c / kWh.)

As shown in the graph below, there is a noticeable difference between average price gains during flood and drought seasons

capital accumulation followed by equipment purchase, delivery and deployment is reflected more broadly in the correlation between price appreciation (which supports capital accumulation) and Hashrate growth 4–6 months later





Section III: Bitcoin Hashrate Growth Projections: How much, by when, why, and what could slow (or accelerate) growth.

Bitcoin network can exceed 260EH/s in Hashrate in the next 12–14 months, led by a modest increase in available power capacity from 9.6 to 10.6GW and an upgrade cycle that will replace older generation S9 class rigs with newer S17 and next-generation S19 class rigs




We believe that a low 3 nm capacity and potential initial low yield will lead to 5 nm operations is the mainstay of ASIC development and production until 2022. For these reasons, we believe that the S19 class excavators will account for the bulk of the shipments in the next 24 months,

So if the Hashrate network increases, the miner's share of the Hashrate total and thus Bitcoin flow decreases. If Bitcoin does not rise to keep pace with the increase in Hashrate, profitability will decrease and a new balance in Hashrate may be created significantly lower than our expectations here.


The dollar value of mined BTC will decrease over time, which will decrease profitability unless Bitcoin price goes up enough to make up for it.

Current Target Network Hashrate ~ 124EH / s and current BTC price of $ 9220, daily revenue per PH / s is ~ $ 70. If the Hashrate network would rise to 260EH / s, as we expect during the summer of 2021, Bitcoin would need $ 19,500 in order to have the same $ 70 in daily revenue per PH / s




What if the price remains the same? At what point will Hashrate not grow? If the power price is 1c/kWh, the S9 drilling rig can continue to operate up to 180HH/s Hashrate Network. At 3c/kWh, the S19 series devices can maintain operations of up to 295EH/s.

However, the devices will fail to recover the capital cost in Hashrates much less than 295EH/s.



If Bitcoin's price will steadily rise to $ 19k in two years at 40% + annually, then S19 class platforms will remain viable even at 5c / kWh power cost