Fundstrat report: the bitcoin price coincides with the break-even point of its production
According to analysts of Fundstrat Global Advisors, currently the cost of extracting one bitcoin practically coincides with the rate of the first crypto currency, which, in fact, causes the miners of many countries to work "to zero."
This is reported by CNBC. "Currently, bitcoin is trading at the breakeven level for miners," said the head of Fundstrat Tom Lee, referring to the mark of $ 8038, at which Bitcoin was trading at the time of the report.
The so-called "Mining Model Fundstrat" includes three factors: the cost of equipment for mining, the cost of electricity, as well as overhead, associated, in particular, with the maintenance of cooling systems. According to Lee, if these costs exceed proceeds from mining, then the miners lose economic incentives.
When calculating the profitability threshold, the price of electricity was used at 6 cents per 1 kWh.
"In some cases, it's easiest for miners to turn off the equipment and wait until the price is slightly adjusted upwards," co-founder and president of Blockchain Intelligence Group Sean Ansti said.
According to Anstey, in order to compete with Chinese miners, the price of 1 kWh is not more than 4 cents. To worldwide miners began to massively curtail activities, the price of bitcoin should fall to the area of 3-4 thousand US dollars.
Analysts at Fundstrat also came to the conclusion that at least half of the expenses of the mining companies are directed to regular replacement of equipment. It is worth noting that by now the price of bitcoin has recovered somewhat. So, at the time of writing, the first crypto currency is traded around $ 8,500.
Earlier ForkLog reported that the cheapest electricity in Venezuela, and among the post-Soviet countries it is most profitable to mine in Uzbekistan and Ukraine.
For future viewers: price of bitcoin at the moment of posting is 8299.00USD