dont look at the bitcoin price and ask what is the value.
instead do some maths on the cost of creating bitcoin. (mining)
EG take the hashrate and divide it by the amount of asics needed to get that hashrate
work out the electric costs needed.
then once you have the XX electric/hour.. divide that by 6(amount of blocks per hour)
then divide that by 12.5 to get the cost per btc.
now you have electric VALUE cost.... also imagine the asic equipment has a years shelf life. so take the initial amount of asics needed and cost them at ~$850 each.. then divide that by 657000(12.5*144*365 is bitcoins mined per year) to get the physical rig cost per btc
..
scrw it. ill give u an exampl based on todays stats
hashrate: 38exahash (38million terrahash)
2714286 asics(38m /14) (because each asic is 14thash)
each asic is 1.3kw/h
3528571kw/h
lets say electric is 5cents an hour = $176428.57 per hour
=$29404.76 per block or electric
=$2352.38 per btc for electric
now add on physical cost of rig
2714286* $850=$2307143100 per year shelf life
=6320940 per day
=$43895.42 per block
=$3511.63 per btc
so 2352.38+3511.63=$5864.01
and now you see the bottomline average cost of mining btc this month..$5864
which explains why the btc price did not dip below that value
(take into account my maths is rough/bottomiline, costs can be higher for area's that are not 5cent/kw)
now ill leave you to do some maths if the hashrate went up to 42exahash which will start to become a new hash average soon
(simple hint for lazyness.. take the end total... divide by 38 then multiply by 42, if you dont want to do it the long way round)
then you can start thinking about hashrate of the future and calculate costs..
.. then and only then look at the markt price and see how close to the cost (near bottomline value) or how far above(lots of over valued speculation) there is
..
instead do some maths on the cost of creating bitcoin. (mining)
EG take the hashrate and divide it by the amount of asics needed to get that hashrate
work out the electric costs needed.
then once you have the XX electric/hour.. divide that by 6(amount of blocks per hour)
then divide that by 12.5 to get the cost per btc.
now you have electric VALUE cost.... also imagine the asic equipment has a years shelf life. so take the initial amount of asics needed and cost them at ~$850 each.. then divide that by 657000(12.5*144*365 is bitcoins mined per year) to get the physical rig cost per btc
..
scrw it. ill give u an exampl based on todays stats
hashrate: 38exahash (38million terrahash)
2714286 asics(38m /14) (because each asic is 14thash)
each asic is 1.3kw/h
3528571kw/h
lets say electric is 5cents an hour = $176428.57 per hour
=$29404.76 per block or electric
=$2352.38 per btc for electric
now add on physical cost of rig
2714286* $850=$2307143100 per year shelf life
=6320940 per day
=$43895.42 per block
=$3511.63 per btc
so 2352.38+3511.63=$5864.01
and now you see the bottomline average cost of mining btc this month..$5864
which explains why the btc price did not dip below that value
(take into account my maths is rough/bottomiline, costs can be higher for area's that are not 5cent/kw)
now ill leave you to do some maths if the hashrate went up to 42exahash which will start to become a new hash average soon
(simple hint for lazyness.. take the end total... divide by 38 then multiply by 42, if you dont want to do it the long way round)
then you can start thinking about hashrate of the future and calculate costs..
.. then and only then look at the markt price and see how close to the cost (near bottomline value) or how far above(lots of over valued speculation) there is
..
This doesn't explain shit actually. If the price falls below the current cost to mine a bitcoin, many miners will be turned off, lowering the difficulty and thus the rewards will increase for those left and the price to mine a bitcoin will adjust down. Bitcoin price could drop to $100 tomorrow and it would be profitable if only a handful of miners were kept mining.
Transactions per block and exchange volume are better numbers to look at regards to price because that reflects demand. Thus, the current price to mine a bitcoin is merely a result of current demand, not a cause of price.
