Help me figure this out? How to estimate the cost to create a Bitcoin?

[Decoded]

Hey guys, I'm not sure if I'm simply overlooking something, but I remember reading some time in the last that last halving, it costed less than $300 to create a Bitcoin. Do I just generally tossed the idea around that nowadays, the value would be double, due to the halving. I realise that this may not be the casee, since due to Moore's Law (Which may not be accurate due to the small amount of research being done into ASICs), the performance of new technology doubles every two or so years, and since a halving is every four years, the price to create a Bitcoin could be much, much different.


So - How would I do this? I can't seem to get my head around this, I'm tired and trying to work this out in my head on the bus.

[digaran]

Hey guys, I'm not sure if I'm simply overlooking something, but I remember reading some time in the last that last halving, it costed less than $300 to create a Bitcoin. Do I just generally tossed the idea around that nowadays, the value would be double, due to the halving. I realise that this may not be the casee, since due to Moore's Law (Which may not be accurate due to the small amount of research being done into ASICs), the performance of new technology doubles every two or so years, and since a halving is every four years, the price to create a Bitcoin could be much, much different.


So - How would I do this? I can't seem to get my head around this, I'm tired and trying to work this out in my head on the bus.

It all goes back to electricity costs and of course a bit of luck for your ASICs to work perfectly and you keeping them cool at all times.
So unless you can find the cheapest electricity you need to be cautious about mining but don't be stupid and start mining whatever it costs you because a few years from now you'll end up regretting it. still with the recent fluctuations we now know where the potentials.

[Decoded]

Hey guys, I'm not sure if I'm simply overlooking something, but I remember reading some time in the last that last halving, it costed less than $300 to create a Bitcoin. Do I just generally tossed the idea around that nowadays, the value would be double, due to the halving. I realise that this may not be the casee, since due to Moore's Law (Which may not be accurate due to the small amount of research being done into ASICs), the performance of new technology doubles every two or so years, and since a halving is every four years, the price to create a Bitcoin could be much, much different.


So - How would I do this? I can't seem to get my head around this, I'm tired and trying to work this out in my head on the bus.

It all goes back to electricity costs and of course a bit of luck for your ASICs to work perfectly and you keeping them cool at all times.
So unless you can find the cheapest electricity you need to be cautious about mining but don't be stupid and start mining whatever it costs you because a few years from now you'll end up regretting it. still with the recent fluctuations we now know where the potentials.

China has free electricity, if not electricity that's really cheap. Let's base it on Chinese mining, since they make up the majority, and for simplicity's sake.

From what I can tell, we have to find an estimate for how many terahashes an ASIC would make in its lifetime. I can't seem to find a number.

[mobnepal]

Actually found one reddit discussion regarding this caculation https://www.reddit.com/r/Bitcoin/comments/4ifmp6/current_cost_to_mine_1_bitcoin/

I also think cost per bitcoin can't be static value and if we only consider chinese miner, cost of electricity vary due to the source of electricity they are using, also cost of land and manpower, cost of mining hardware etc will be different in different places.

http://www.coindesk.com/information/mining-profitability/ found this quite useful article to read when calculating mining profitability.

[maku]

We might want to know how the first exchange rate for USD was calculated.
From what I know First Exchange Rate was published by New Liberty Standard in 2009.

This is how they calculated cost of 1 bitcoin back then:

"During 2009 my exchange rate was calculated by dividing $1.00 by the average amount of electricity required to run a computer with high CPU for a year, 1331.5 kWh, multiplied by the the average residential cost of electricity in the United States for the previous year, $0.1136, divided by 12 months divided by the number of bitcoins generated by my computer over the past 30 days."


Source: http://newlibertystandard.wikifoundry.com/page/2009+Exchange+Rate

[Xester]

Well in order for you to compute the cost to create bitcoin first you must gather all necessary data. What kind of miner are you using if it is Asic what it its capacity to mine? Then, ask how strong is my internet connection and determine how much electricity it is consuming per hour. After that using those datas compute how much will your miner mine by looking at the mining income projections in the internet. After having the projected income in bitcoins convert it to dollar then you subtract your electric bill as well as your internet bill then you will get how much you will earn. After looking at the projections you will determine if mining is a feasible idea or not.

With this, you are not only computing the cost but also your potential income.

[franky1]

if you are antpool/bitmain/bitfury etc.. the cost is zero.. thanks to their retail sales of asics..
well kinda

at most its just the electric price which is ~$225 per 13thash asic for 6months. but this can also be offset thanks to their retail sales too

this is because the retail price they sell their ASICS to others is 4-5x the cost of manufacturing an ASIC.
so for every asic sold antpool can keep 3-4 asics themselves or have 1 asic themselves and spare funds for electric, wages and shelter lease.

but if you are in the west having to buy an asic and pay the electric

first its $2100 for 13thash asic, (pre christmas it was just $1600/asic)
then the electric, shelter lease, salary and the PSU needs to be added

but first the electric
if you are in the US its ~$450 for 6 months electric per asic (totalling ~$2700 all included for 6 month running time or ~$3100 for a year)
if you are in the UK its ~$900 for 6 months electric per asic (totalling ~$3100 all included for 6 month running time or ~$3500 for a year)


some maths was done before christmas that calculated it would take 1 asic 6 months to get 1btc. so if asic manufacturers were to pay electric(~$225(add a bit more for wage/shelter leasing)), then $300 sounds right. thanks to the freebie asic they get due to their retail business

but.. here is the but..  the hashrate competition and the difficulty has changed since then. antpool alone opened a new facility and their hashrate has jumped considerably, as has the network difficulty.

the network difficulty has jumped ~29% since previous calculations of predicted 6month for 1btc/asic..
the network hashrate has jumped ~30% since previous calculations of predicted 6month for 1btc/asic..

factoring in other things. like knowing hashrate/difficulty changes, at 6 months now only gets you 0.89btc and takes a further 2 and a half months to get 1btc

and yes i done calculations that step down the income per fortnight dependant on difficulty/hashrate competition variation.
where those fortnightly stepping down income, really affect income as time passes.

summary
for asic manufacturers its between 0-$400/btc if including electric leases etc (compared to prechristmas $300)
for asic consumers its between $2900(US)-$3500(uk) (compared to prechristmas $2100(US)-$2600(uk))

[Decoded]

I was thinking about this overnight, and I focused my calculations totally on Moore's Law, which says that about every two years, new tech would be developed that was twice as more powerful than it was 2 years ago.

If I were to assume this were to continue into the foreseeable future, I could take a rough estimate that the miner's hash percentage would halve over and over, until it's electricity would cost more than its returns.

The current hashrate is 2738690 TH/s. An Antminer costs can pump out 13TH/s. So the chance of mining a block would be ~1 in 2738690. In one year, the chance to miners a block in a year would be 52560 in 2738690. Basically 1 in 5.

So every five years, you would make 12.5 btc, so 2.5 btc a year. When 2.5 btc is less than what the yearly electricity fees are, we have a problem.

[calkob]

Hey guys, I'm not sure if I'm simply overlooking something, but I remember reading some time in the last that last halving, it costed less than $300 to create a Bitcoin. Do I just generally tossed the idea around that nowadays, the value would be double, due to the halving. I realise that this may not be the casee, since due to Moore's Law (Which may not be accurate due to the small amount of research being done into ASICs), the performance of new technology doubles every two or so years, and since a halving is every four years, the price to create a Bitcoin could be much, much different.


So - How would I do this? I can't seem to get my head around this, I'm tired and trying to work this out in my head on the bus.

When you say create, i am guessing you mean buy?  there is no way you are creating a bitcoin for anywhere near $300

[Kakmakr]

You cannot just factor in the electricity price. You have to calculate the infrastructure & the cooling that needs to be installed and also the cost of the Asic's. You also need to pay salaries to people to manage the mining farms, so that needs to be added to. This way, you calculate the total price per Bitcoin, before any profit can be made.

It would be nice, if someone could take all of this into consideration to make a detailed calculations to show how much a actual Bitcoin costs. ^smile^

[Lubang Bawah]

Many factors for such things, but I'll simplify only into 2 IE bitcoin price and the cost of electricity, if electricity costs 10 cents then the price should be $900 bitcoin, you will be able to profit.

[Amph]

you simply calculate the consumption from the total hash that you need to have to create 1 bitcoin

if we assume that your device roi'ed already then you need, at present, an hashrate equal to 45TH to create one bitcoin in one month

45TH consume 4.5kwh which is around $162 a month, so you need $162 to produce $834(1 btc)

[ASHLIUSZ]

you simply calculate the consumption from the total hash that you need to have to create 1 bitcoin

if we assume that your device roi'ed already then you need, at present, an hashrate equal to 45TH to create one bitcoin in one month

45TH consume 4.5kwh which is around $162 a month, so you need $162 to produce $834(1 btc)

So most of the concern is related to the electricity consumption. People from Countries having much decreased electricity charges are the best profiting users. In a third world country if the calculations were similar to the above quote then they can make a comfortable living through it. There are several websites that give you the hash rate calculation based upon the data fed into it.