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Topic: Research shows it is hard to make money with bitcoin mining - page 2. (Read 911 times)

mocacinno
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Re: Research shows it is hard to make money with bitcoin mining
September 24, 2018, 07:14:13 AM
#2
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Thanks a lot! I really loved collecting it all and see patterns emerge. Price is a big factor in bitcoin mining. During my measurement period, the price was dropping for a while, but this did not really hurt hash rate. What do you think the reson is?

I don't think there's just one single reason why the hashrate doesn't drop on a price dip. These are some of the reasons that might contribute to the phenomenon:

- a miner running an asic farm can't switch pow algo's, so he doesn't have a lot of choices to start mining on a different chain. As long as he produces more btc than his hw cost, he"s probably better off if he keeps mining... Even if he can't roi.

- some amateurs don't care about profit, they just mine to keep the diff high

- ignorance

- people that keep mining because they believe the price will rise again, but don't realise they're probably better off if they'd stop their mining and buy btc directly instead of paying more for their power than they generate in btc
Jonesd
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Re: Research shows it is hard to make money with bitcoin mining
September 24, 2018, 04:37:33 AM
#1
I reverse engineered the bitcoin network mining over the last couple of years and looked at the sustainibility of it from an economic point of view. My research was just published in a peer-reviewed journal.



In short we estimate that between 2012 and 2016:

- Two billion dollar of bitcoin was mined ($2,007,950,000, based on daily price)
- The miners ran a communal deficit of approximately $558 mln at an energy cost of $0.12 per kWh. An energy price of $0.03 per kWh is required to run a small profit.
- Approximately $2.1 bln was invested in hardware. (of which $330 mln was still operational at the end of the measurement period)
- Bitcoin hash rate increased by a factor 347,000
- Electricity costs increased rapidly and amounted to almost 900 million dollars.
- The estimates of energy consumption of the network are in line with De Vries (2018) and Bitcoin Energy Consumption Index(BECI).
- Payback time for hardware was usually between 100 to 300 days, but could be as short as three days. However, his time was often too short to earn the investment back before the mining ceased to be profitable due to increased network hash rate

You can read more about it here: https://medium.com/@jonaderks/where-is-the-money-in-bitcoin-mining-64e13d2c94c0

Tell me what you think! I can imagine some findings don't match with your personal experiences.
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