Bitcoin cost to mine

How Much Does It Cost to Mine Bitcoin Around the World?

Nathan Reiff has been writing expert articles and news about financial topics such as investing and trading, cryptocurrency, ETFs, and alternative investments on Investopedia since 2016.

As the price of bitcoin has soared, so too has the energy and computing power required to mine it. The world’s most popular cryptocurrency by market cap is now most often mined by collectives or large-scale operations running multiple rigs. (See also: GPU Usage in Cryptocurrency Mining.)

Many individual miners have found that the cost of building a computing rig powerful enough to keep up in the process is simply unfeasible. Nonetheless, some areas have emerged as mining hubs for various cryptocurrencies, thanks in large part to available space and the cost of electricity.

Now, one recent study, cited by bitcoin.com, aimed to determine just how much it costs to mine for bitcoin around the world. (See also: China May Curb Electricity for Bitcoin Miners.

Mining Costs Vary Dramatically

Elitefixtures.com conducted the study, basing its calculations on average electricity rates for 115 countries sourced from government data, as well as on estimates of the amount of time it would take to mine for a single BTC based on difficulty levels during January of 2018. The results showed that, depending upon where the mining happened, the total cost of mining for one bitcoin might vary dramatically.

At the lower end of the spectrum were countries like Trinidad and Tobago ($1,190 to mine one BTC), Kuwait ($1,983), Belarus ($2,177), and Bangladesh ($2,379). Given that the price of bitcoin was significantly higher than this rate throughout January of 2018, one might expect to be able to earn a profit off of bitcoin mining in countries such as these.

At the opposite end of the spectrum were countries like Belgium ($13,482), Cook Islands ($15,861), Marshall Islands ($14,751), and South Korea ($26,170). The United States was $4,758, the U.K. was $8,402, and cryptocurrency mining hub China was just $3,172.

(Image: Elite Fixtures)

Islands and South Korea

Many island nations have a high cost associated with mining for bitcoin, likely because of associated high costs of electricity in those areas. South Korea is the country with the highest cost, however. The cheapest country for mining BTC was Venezuela (just $531 per coin).

The United States is the 41st-cheapest country for bitcoin mining, falling just behind Russia. However, within the United States, the price associated with mining varies from state to state. Louisiana is the cheapest state, with a cost of $3,224. Hawaii, on the other hand, has a cost of $9,483 per coin.

In sum, the report shows that there are areas of the world that are absolutely favorable for mining bitcoin, as well as other areas where the practice is likely not sustainable at all. (See also: Do Bitcoin Mining Energy Costs Influence Its Price?)

Investing in cryptocurrencies and Initial Coin Offerings («ICOs») is highly risky and speculative, and this article is not a recommendation by Investopedia or the writer to invest in cryptocurrencies or ICOs. Since each individual’s situation is unique, a qualified professional should always be consulted before making any financial decisions. Investopedia makes no representations or warranties as to the accuracy or timeliness of the information contained herein. As of the date this article was written, the author owns bitcoin and ripple.

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Why The Actual Cost Of Mining Bitcoin Can Leave It Vulnerable To A Deep Correction

A technician inspects the backside of bitcoin mining at Bitfarms in Saint Hyacinthe, Quebec on March . [+] 19, 2018. Bitcoin is a cryptocurrency and worldwide payment system. It is the first decentralized digital currency, as the system works based on the blockchain technology without a central bank or single administrator. / AFP PHOTO / Lars Hagberg (Photo credit should read LARS HAGBERG/AFP via Getty Images)

AFP via Getty Images

In early 2020, researchers predicted the cost to mine Bitcoin will be at around $12,000 to $15,000 after the block reward halving in May. But, it is now much cheaper to mine BTC than the initial estimates. The low breakeven price to mine Bitcoin may leave it vulnerable to a correction.

Bitcoin has become more affordable to mine in recent weeks due to two main factors: difficulty adjustments and cheaper electricity in Sichuan, China due to the rainy season.

A low breakeven price of Bitcoin can raise the probability of a price pullback because miners have more incentive to sell BTC, which may increase selling pressure in the short-term.

On May 11, the third block reward halving in the history of Bitcoin occurred. A halving is activated every four years and it decreases the amount of BTC miners can generate by half.

A halving is necessary for Bitcoin because the dominant cryptocurrency has a fixed supply of 21 million BTC. As it reaches towards its maximum supply, the rate of producing BTC decreases to provide balance.

But, when a halving happens, miners experience a near-50% cut in their revenues overnight. As such, it typically leads over-leveraged miners to capitulate or stop operating due to high costs.

Revenue of Bitcoin miners fall steeply after the halving.

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When fewer miners are mining BTC, the Bitcoin network automatically adjusts the difficulty to mine BTC.

Since Bitcoin miners use computing power to mine, big mining centers can usually mine more BTC after the difficulty adjusts.

The Bitcoin blockchain network saw two difficulty adjustments in the past three months, allowing major miners to see higher revenues in the short-term.

Here’s where the extra surplus of BTC becomes a problem.

According to several Chinese miners based in Sichuan, China, electricity in the region costs around $0.04 per kilowatt-hour.

Due to the rainy season and the abundance of hydropower plants in the area, mining industry executives state that large mining centers in China can often negotiate lower electricity prices.

With $0.04/kwh, miners based in China said that the breakeven cost to mine Bitcoin hovers in the $5,000 to $6,000 range.

Even individual miners running commercial mining equipment like the Antminer S9 is operating at a breakeven cost of $8,206.

“To be completely accurate: Given current difficulty, 0.04$/kWh and S9 running custom firmware bringing it down to 71W per TH efficiency. The cost to mine 1 BTC is 8206.64$. Meaning its still profitable,” one miner said.

Considering the cost to mine Bitcoin for both big mining centers and individual miners can range in between $5,000 and $8,500, miners have more incentive to sell to cover operational costs rather than to hold onto the BTC they mine.

According to data from ByteTree, Bitcoin miners did not sell much Bitcoin in the past week. Around 6,825 BTC were mined and 6,298 BTC were sold, leaving 527 BTC in net inventory.

Bitcoin miners did not sell more than they mined in the past seven days.

In previous weeks, especially throughout March, on-chain data shows that miners sold more Bitcoin than their revenues.

Yet, the price of Bitcoin struggled to see a short-term rally despite the noticeable decline in selling pressure from miners since the start of June.

The price of Bitcoin struggles to break out despite low selling pressure.

The relatively cheap cost to mine Bitcoin and the failure of BTC to break out of a multi-year resistance level at $10,500 with fewer sellers in the market raise the likelihood of another correction.

I’m a financial analyst and investor who has worked in the cryptocurrency and technology sector since 2013. I’ve worked with leading publications within the

I’m a financial analyst and investor who has worked in the cryptocurrency and technology sector since 2013. I’ve worked with leading publications within the cryptocurrency space, providing unique insights, interviews, market analysis, and technology coverage. I’ve contributed to Cointelegraph, CryptoSlate, CCN, Hacked, Binary District, NewsBTC, CoinJournal and CryptoInsider.

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Bitcoin Price and Market Stats

Bitcoin Price

BTC Price	$37,104
Market Cap	$693,317,915,885
Market Cap Dominance	42.28%
Trading Volume	$43,139,632,195
Volume / Market Cap	0.0621
24h Low / 24h High	$35,855 / $38,849
7d Low / 7d High	$33,451 / $37,554
Market Cap Rank	#1
All-Time High	$64,805 -42.9% Apr 14, 2021 (about 2 months)
All-Time Low	$67.81 54483.2% Jul 06, 2013 (almost 8 years)

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#	Exchange	Pair	Price	Spread	+2% Depth	-2% Depth	24h Volume	Volume %	Last Traded	Trust Score
*	0.12%	$4,302,802	$4,005,452	37070.73 USDT	0.02%	$1,985,266	$1,990,840	2129.597 BTC	0.18%	Recently
1	37203.83 USDT	0.01%	$35,172,258	$8,569,614	107584.251 BTC	9.24%	Recently
2	36700.74731633 USD	0.03%	$22,472,920	$25,788,260	9737.678 BTC	0.83%	Recently
3	4014799.99999984 JPY	0.02%	$22,810,671	$26,593,092	30116.109152 EUR	0.07%	$22,641,922	$26,686,265	25881 GBP	0.08%	$21,726,801	$27,420,132	Bitcoin Price & Market Data Bitcoin price today is $37,299 with a 24-hour trading volume of $43,341,153,131 . BTC price is up 0.9% in the last 24 hours. It has a circulating supply of 19 Million BTC coins and a max supply of 21 Million. If you are looking to buy or sell Bitcoin, Binance is currently the most active exchange. What is Bitcoin? Bitcoin is a cryptocurrency. It is a decentralized digital currency that is based on cryptography. As such, it can operate without the need of a central authority like a central bank or a company. It is unlike government-issued or fiat currencies such as US Dollars or Euro in which they are controlled by the country’s central bank. The decentralized nature allows it to operate on a peer-to-peer network whereby users are able to send funds to each other without going through intermediaries. For more information on Bitcoin, do read CoinGecko’s How to Bitcoin book. Who created Bitcoin? The creator is an unknown individual or group that goes by the name Satoshi Nakamoto with the idea of an electronic peer-to-peer cash system as it is written in a whitepaper. Until today, the true identity of Satoshi Nakamoto has not been verified though there has been speculation and rumor as to who Satoshi might be. When was Bitcoin launched? It was launched in January 2009 with the first genesis block mined on 9th January 2009. How does Bitcoin work? While the general public perceives Bitcoin as some kind of physical looking coin, it is actually far from that. Under the hood, it is actually a distributed accounting ledger that is stored in a form of a chain of blocks, hence the name blockchain. In a centralized system like the ones operated by a commercial bank, given a situation where Alice wants to transact with Bob, the bank is the only entity that holds the ledger that describes how much balance Alice and Bob has. As the bank maintains the ledger, they will do the verification as to whether Alice has enough funds to send to Bob. Finally when the transaction successfully takes place, the Bank will deduct Alice’s account and credit Bob’s account with the latest amount. Bitcoin conversely works in a decentralized manner. Since there is no central figure like a bank to verify the transactions and maintain the ledger, a copy of the ledger is distributed across Bitcoin nodes. A node is a piece of software that anybody can download and run to participate in the network. With that, everybody has a copy of how much balance Alice and Bob has, and there will be no dispute of fund balance. Now, if Alice were to transact with Bob using bitcoin. Alice will have to broadcast her transaction to the network that she intends to send $1 to Bob in equivalent amount of bitcoin. How would the system be able to determine that she has enough bitcoin to execute the transaction and also to ensure she does not double spend that same amount. Here is where mining takes place. A Bitcoin miner will use his or her computer rigs to validate Alice’s transaction to be added into the ledger. In order to stop a miner from adding any arbitrary transactions, they will need to solve a complex puzzle. Only if the miner is able to solve the puzzle (called the Proof of Work), which happens at random, then he or she is able to add the transactions into the ledger and the record is final. Since running these computer rigs cost money due to capital expenditure for buying the rigs and the cost of electricity, miners are rewarded with new supply of bitcoins that is part of its monetary system and some amount of fees paid by the person who wishes to transact (in this case it is Alice). This makes the Bitcoin ledger resilient against fraud in a trustless manner. While it is resilient, there are still some risks associated with the system such as the 51% attack where by miners control more than 51% of the total computation power and also there can be security risks outside of the control of the Bitcoin protocol. How to keep your Bitcoin safe? When transacting coins, you would typically be doing it on your personal computer. Since your personal computer is connected to the internet, it has the potential to be infected by malware or spywares which could compromise your funds. Hardware wallets such as Trezor and Ledger are strongly encouraged in mitigating that risk. These are external devices that look like USB sticks. A hardware wallet secures your private key that holds your Bitcoin into an external device outside of your personal computer. When you intend to transact, you would connect the hardware wallet into your personal computer, and all the key signing in order to transact would be done in the hardware itself outside of your computer. However, if you physically lose your hardware wallet without a key phrase backup, there is no other way of recovering your funds ever. As such when setting up your hardware wallet, always remember to keep a copy of the key phrase and put it somewhere safe from fire or flood. Bitcoin Halving Bitcoin Halving or sometimes also known as the Halvening, refers to the reduction of block reward to miners by half. This is part of its built-in monetary policy, in which after every approximately 4 years, the mining reward will be halved towards the limited capped supply of 21 million Bitcoin. Once 21 million of Bitcoin have been minted, there will no longer be new supply of it rewarded to miners, and miners are expected to earn revenue by way of transaction fees. In order to follow the real time of when the halving will take place, you can bookmark the CoinGecko’s bitcoin halving page. This is seen as a significant event for couple of reasons. Firstly, traders may speculate on the possible scarcity of Bitcoin making way to high volatility. Secondly, as miners’ rewards will be reduced, we may see some miners exiting the market as they could not sustain the lower profitability. This in turn may cause the hashing rate to reduce and mining pools may consolidate. Due to this, the bitcoin network may be a little unstable during the halving period. Is Bitcoin a good investment? We do not provide investment advice. The price of bitcoin started off as zero and made its way to the market price you see today. It appears that the market is placing value for the following reasons. Digital Gold — It is a viable digital store of value due to its digital scarcity Payment — Almost instant and low cost transaction with anyone on the internet Speculation — This may be due to inefficiency in the market, but there are people speculating that Bitcoin may be the asset class of the future That being said, Bitcoin comes with risks. In order to determine for yourself if it is a good investment, it is important to understand the risk and only invest amount that you are comfortable losing. There is a probability of Bitcoin price going to zero. This can happen if the project fails, a critical software bug is found, or there are newer more innovative digital currencies that would take over its place. If you recall Bitcoin was worth nearly $20,000 in 16th December 2017. But in 17th December 2018, the price of Bitcoin was at its low of about $3,200. Bitcoin is a highly volatile asset class and requires a high risk appetite. As much as Bitcoin is a digital gold, it has only been around for about 10 years. In comparison to gold which has been a widely known store of value for over hundreds of years. Can I short Bitcoin? Yes, as bitcoin has grown to become more widely adopted, there are various derivative products being launched that allows you to short sell bitcoin. If you are an institutional investor, CME and Bakkt provide regulated bitcoin futures products which you can participate to long or short bitcoin. Alternatively, there are many other cryptocurrency derivative exchanges such as BitMEX, Binance Futures, FTX, Deribit, and more. These derivative exchanges are not formally regulated and can provide even up to 100x leverage. Derivative contracts are high risk products, you might want to understand what you are doing before participating in it. 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