Bitcoin Difficulty May Push Some Miners Below Power Costs

Bitcoin’s mining difficulty is projected to increase 5.68% around Oct. 16. If Bitcoin’s price, block subsidy and average transaction fees remain unchanged, revenue per unit of computing power would fall 5.37% after the adjustment.

A network dashboard recorded Bitcoin’s difficulty at 132.72 trillion and hashprice at $39.77 per petahash per day at 07:02 UTC on Oct. 14. Bitcoin was trading at $83,557.78 at the time.

Hashprice measures the expected daily revenue from one petahash per second of computing power before expenses. The projected adjustment would reduce hashprice to about $37.63, assuming Bitcoin’s price, block subsidy and average fees remain unchanged. The reduction is smaller than the difficulty increase because mining revenue changes inversely with difficulty.

A machine using 20 joules per terahash and operating at 1 petahash per second consumes about 20 kilowatts, or 480 kilowatt-hours per day. At an electricity rate of 8 cents per kilowatt-hour, its daily power cost is $38.40. At the current hashprice, the machine generates about $39.77 per day, leaving a $1.37 electricity cushion. After the projected adjustment, revenue would fall to about $37.63, creating an estimated power shortfall of 77 cents per day.

The highest electricity rate covered by gross mining revenue for a 20 J/TH machine would fall from about 8.29 cents to 7.84 cents per kilowatt-hour. The calculation excludes pool fees, cooling, other site electricity use, repairs, operating expenses and financing costs.

For 15 J/TH equipment, the electricity-only threshold would decline from 11.05 cents to 10.45 cents per kilowatt-hour. The threshold for 25 J/TH equipment would fall from 6.63 cents to 6.27 cents, while the threshold for 30 J/TH equipment would decrease from 5.52 cents to 5.23 cents.

The adjustment was still pending on Oct. 14, with 347 blocks remaining before block 971,712. Bitcoin recalculates its mining difficulty every 2,016 blocks to target an average block time of 10 minutes. The projected increase and estimated date may change as more blocks are mined.

The calculation measures the effect of higher difficulty only. Changes in Bitcoin’s price, the block subsidy or transaction-fee revenue could change hashprice after the adjustment.