please delete

[cryptoangel]

Miners are the biggest whales, because they create bitcoin from electrical power. They need to distribute it, hence why the price tanks between the crash and the halving.

I don't think miners are biggest whales in Bitcoin because current scenario more than 85 percentage of Bitcoin is circulation so traders are the main reason for pump and dump. Normally most of the investors are concentrate trading platform so once they sell continuously it will drop gradually or else everyone concentrate buying the Bitcoin it will going to moon.

[The Sceptical Chymist]

It does really work that way?

No, it doesn't.  There is no rational way to predict what bitcoin should be valued at, though I've read similar theories like this based on mining.  The only thing that affects bitcoin's price is supply and demand--and since supply is increasing at a known rate, it basically all comes down to demand, or the buying and selling of bitcoin on exchanges.  That's it.

OP's theory might sound reasonable right now, but it doesn't exactly explain why bitcoin got to $13k a few months ago or any other extreme deviation from the theory.

[alexsandria]

It ain't working that way though, simple math lol. It has derivatives out there, and tons of people out there having some transaction stuff, buying and selling bitcoin that is directly affecting bitcoin price. It ain't all about hash power and miners should increase theirs to as well market will go increased. 'Cause if it will be going that way I am quite sure that miners need to set standards for them to increase bitcoin price way back before.

[jets567]

So what else are we doing here if we cannot even help with the increase in value of bitcoin? We are just puppets of the miners?  

Exactly! if we are depending on miners hash rate for the value of Bitcoin then it would be so easy to predict its price on the next coming months. I know that miners may somehow affect the price of Bitcoin but they don't have the full authority to dictate its price since large amount of Bitcoin is hold by whales and exchanges.

[el kaka22]

Hashrate doesn't reflect the price at all times, there needs to be a bit of increase from the hashrate in order to have some sort of profit as well, these people spend 8200 dollars to make 8780 dollars, that is not even a decent profit if you ask me, hence why the price should be even higher.

Still, when you look at last year when the price fell from 6-8k prices to close to 3 thousand dollars you will see that price could also go under the mining cost, people who have mined or people who have bitcoin from trading or some other way (Craig Wright for example got it for free) could just sell all their coins and even miners can't stop it, they just stop their machines to not make a loss which drops the difficulty and then they start it back up again when it is easier to mine.

[YuginKadoya]

Hashrate is not the key, this is simply fluctuation doing its work and I guess this is only a small decrease on the price and now as I speak the price is back again in $9000 USD, This is very simple indeed all of us are speculating yes, but what do we expect cryptocurrency is very volatile the price would surely not stay in one place it will surely move upward or downward at all times, maybe you are just used with the price being calm for a couple of days but for Bitcoin enthusiast this slight movement is very normal indeed.

[1Referee]

Recent hashrate was 82 EHS, therefore:

Recent? Like a month ago? The hashrate over a greater number of blocks hasn't gone under 90 eh/s.

The hashrate you are referring to is measured over a low number of blocks, which currently has jumped to 100 eh/s, so your 82 eh/s figure is not accurate anymore, just like how my 100 eh/s figure won't be accurate anymore in the forthcoming hours. That alone makes calculating the price versus the not accurate hashrate figure not a good foundation to build on to determine what a "fair" price is.

Did we forget what happened last year? People were so confident that miners needed the $6000 level to operate profitably, that they assumed $6000 was the bottom. It couldn't go below $6000. Well, it did and it went below $6000 a lot.

[Wexlike]

Recent hashrate was 82 EHS, therefore:

Recent? Like a month ago? The hashrate over a greater number of blocks hasn't gone under 90 eh/s.

The hashrate you are referring to is measured over a low number of blocks, which currently has jumped to 100 eh/s, so your 82 eh/s figure is not accurate anymore, just like how my 100 eh/s figure won't be accurate anymore in the forthcoming hours. That alone makes calculating the price versus the not accurate hashrate figure not a good foundation to build on to determine what a "fair" price is.

Did we forget what happened last year? People were so confident that miners needed the $6000 level to operate profitably, that they assumed $6000 was the bottom. It couldn't go below $6000. Well, it did and it went below $6000 a lot.

We have some background info now:

Hut 8 Mining Corp. Reports Financial Results for the Third Quarter of 2019

Q3-2019 Highlights:

• Revenue of $26.7 million; Mining Profit Margin of 58%, and Adjusted EBITDA of $14.7 million.
• Mined 1,965 bitcoin at a Cost per Bitcoin of US$4,363 inclusive of electricity costs, mining pool fees, and all other production costs.
• Strengthened balance sheet through the reduction of debt by $3.6 million and reduced accounts payable by more than $6 million from the prior quarter.
• Increased Retained Bitcoin inventory by 7.6% from the prior quarter to 3,496 bitcoin.
• Announced petahash capacity increases of 19.6%.
• Approval for trading on the Toronto Stock Exchange.

[exstasie]

There is no rational way to predict what bitcoin should be valued at, though I've read similar theories like this based on mining.  The only thing that affects bitcoin's price is supply and demand--and since supply is increasing at a known rate, it basically all comes down to demand

Supply is increasing at a known rate but that says little about the total amount of BTC that will be sold on the market. Put another way, miner supply becomes less important over time as we head closer to zero inflation.

So both supply and demand are very opaque from a fundamental standpoint. That's why TA remains the best approach to price analysis.

[karanggatak]

I think this is not a matter of hashrate. bitcoin has high volatility so we don't need to worry or be confused with the current decline. after yesterday it dropped to $ 8,800 today bitcoin pumps again to $ 9,000. bitcoin is always like this fluctuating and this can be used as a good opportunity to be able to make a profit. I never worry when bitcoin goes down because I'm sure bitcoin will pump even higher. and in my opinion the decline yesterday was because bitcoin was correcting the market..

[Reid]

Wow! If I had only known that, then it would be easier as always.  
Imagine just looking at EHS and there you go, here is the price of it.
That would really simplify all and we dont even need to speculate here anymore.
We dont need those hard working analyst and technical viewers. We just need to ask the miners what is the EHS and Voila! we can trade it easily.
Wait! If all of us already know how to calculate the price, then what is the sense of trading it?  

[STT]

Sounds like a fair topic to consider but it wont ever be a fixed ratio when we have a free market and so much of our BTC market is people speculating with many varied reasons for speculating in their particular currency.    Its probably worth graphing this hash rate vs the price and how that develops over time, maybe it gives some indictor of relative value but since BTC does adjust also I guess its never going to fixed or forcing a price to occur.
  Reminds me alot of the ratio for oil to gold prices which does make alot of sense as gold requires so much energy to refine it from the raw material extracted initially, the purity requires quite alot of processing usually.   So over time, many decades they do find it tend to come to a certain ratio but as I remember it can double away from what is expected and its some indication of demand and growth in economies.    Its possible hash ratio can be useful to keep note of also.

[7788bitcoin]

So even at ~$8,780, it's still a little over-priced.
Miners, get your hashrate up and increase the price!

The price of bitcoin has nothing to do with the hash rate, when the price of bitcoin increases there might be more users mining and not the other way around. The price depends upon the basic principle of supply and demand and if the demand increases then the price will naturally increase and the reason why everyone is expecting a rally in bitcoin after halving is because the supply will decrease and not because the hash rate increase  .

[Doell]

I think this is not a matter of hashrate. bitcoin has high volatility so we don't need to worry or be confused with the current decline. after yesterday it dropped to $ 8,800 today bitcoin pumps again to $ 9,000. bitcoin is always like this fluctuating and this can be used as a good opportunity to be able to make a profit. I never worry when bitcoin goes down because I'm sure bitcoin will pump even higher. and in my opinion the decline yesterday was because bitcoin was correcting the market..

yes in fact the price of bitcoin has always been fluctuating and if do not want to take risks it will not be profitable ,demand and supply are factors that will grow the price but it would be better if more people adopted bitcoin to be used in real payments such as past pizza stories that will expand the network interest in the market

[Taskford]

I think this is not a matter of hashrate. bitcoin has high volatility so we don't need to worry or be confused with the current decline. after yesterday it dropped to $ 8,800 today bitcoin pumps again to $ 9,000. bitcoin is always like this fluctuating and this can be used as a good opportunity to be able to make a profit. I never worry when bitcoin goes down because I'm sure bitcoin will pump even higher. and in my opinion the decline yesterday was because bitcoin was correcting the market..

yes in fact the price of bitcoin has always been fluctuating and if do not want to take risks it will not be profitable ,demand and supply are factors that will grow the price but it would be better if more people adopted bitcoin to be used in real payments such as past pizza stories that will expand the network interest in the market

Many people got inspired for pizza stories but actually there's nothing it can do today since in the first place the Bitcoin at that time is almost no value and today we are at expensive state and provably if we can gather more people who's willing to stake then might we will see again those golden days what 2017 brings. But today for sure this current scenario is natural even of correction but hopefully soon we can see the price pumping so hard.

[BrewMaster]

Recent hashrate was 82 EHS, therefore:

Recent? Like a month ago? The hashrate over a greater number of blocks hasn't gone under 90 eh/s.

The hashrate you are referring to is measured over a low number of blocks, which currently has jumped to 100 eh/s, so your 82 eh/s figure is not accurate anymore, just like how my 100 eh/s figure won't be accurate anymore in the forthcoming hours. That alone makes calculating the price versus the not accurate hashrate figure not a good foundation to build on to determine what a "fair" price is.

Did we forget what happened last year? People were so confident that miners needed the $6000 level to operate profitably, that they assumed $6000 was the bottom. It couldn't go below $6000. Well, it did and it went below $6000 a lot.

about 2 months ago people went crazy about a simple swing in the hashrate charts and some of them even panicked in the market and sold their coins for no reason! just because a poorly written block explorer had a bug!
i created a topic about hashrate and how hashrate, how it is calculated in reality versus what these sites do and why that is bad. it got buried under spam in main board though. here is the link https://bitcointalk.org/index.php?topic=5187499.0

[bitbunnny]

Why are people so surprised with current price range? It's the level the price was few weeks ago. Or does everyone really think once the price starts to rise there is no coming back? I always wonder if only Bitcoin users are so naive and under educated or every other investors in other types of investment ( like gold and stock exchange) are the same?

[coinfinger]

I will we can always have the real reason why bitcoin have the value it has at that time, but I think many of us are just trying our possible best to find an answer to it. Your analysis looks great but I doubt if that is what will make the value of bitcoin to increase. For the activities of miners to increase, the demand of bitcoin must also increase, and for the demand of bitcoin to increase, there are things that must contribute to it, it could be because of market manipulation, it could be because of adoption and any other reason.

I don’t know how this hash rate has become a factor to predict the value of bitcoin, but some of the one that I have seen as not really tallied at all and I just think that it does not really work the way that you see it.

[EdenHazard]

Why are people so surprised with current price range? It's the level the price was few weeks ago. Or does everyone really think once the price starts to rise there is no coming back? I always wonder if only Bitcoin users are so naive and under educated or every other investors in other types of investment ( like gold and stock exchange) are the same?

OP is just trying to correlating the mining process.. rewards to the current price mathematically.

While there's no way to do it technically, we are in the free market where things turned out non fixed pattern, the price will always move in unpredictable pattern due none of us has the power to fixed it at certain point.
That's what makes bitcoin beautiful, it's completely a form of freedom where we are not under anybody's control unlike stocks market and any other centralized financial market.

[Dart18]

I hope that is right. Next time we wont see a lot of graphs and some calculation theories if this is the case.
Who doesn't want it to be that easy?

But as I see to the comments above me, it looks like you got it all wrong.
There is what we call demand. Even with the price of any item out there, if it is just calculated with just as simple as that then we dont need people to buy it at any number.
Let us put turkey as an example. This December there will be a lot of orders of it because of the holidays so the price will be soaring.
That is demand, and bitcoin have that feature.