Bitcoin Miners Ruined by Downturn, “Selling Hardware by the Pound”; Giga Watt Files BankruptcyMiners have been decimated by the market downturn. In response, miners have started decommissioning hardware, mothballing rigs, and even selling hardware by the pound.
Bitcoin and cryptocurrency proof-of-work (PoW) mining is a controversial topic. Mining is a process where computers continuously solve a difficult algorithm in exchange for cryptocurrency. This exchange consumes a massive amount of electricity, but also secures and processes transactions on the Bitcoin network.
This excessive consumption of electricity is intentional. Decision-making power in Bitcoin is based on the agreement and consensus of miners. By making it very expensive to gain majority control of the Bitcoin network, the coin is able to remain more decentralized and more secure from hacking.
By the NumbersBased on estimates from the most sophisticated Bitcoin miner, the Antminer S9i, mining a single Bitcoin takes roughly 51,000 kWh, the equivalent of one day’s electricity consumption for 1700 residential homes.
At a standard electricity rate of $0.12 per kWh, mining one Bitcoin costs $6100.
That said, the recent drop in market prices is cause for concern. Lower Bitcoin prices make it less profitable to mine. Lower profitability results in less miners and the miners that remain are typically large-scale operations that can keep costs down.
Reference:
https://cryptoslate.com/bitcoin-miners-ruined-by-downturn-selling-hardware-by-the-pound-giga-watt-files-bankruptcy/