Why Bitcoin Miners May Be Better Protected Against Inflation

[arzuo]

One very good thing is that while ordinary people have to worry about their daily expenses and salaries increasing due to interest and inflation, Bitcoin miners have no reason to worry about this, because the price of Bitcoin itself keeps increasing, unlike inflation.

[philipma1957]

Power bill rises
difficulty rises.

in 2012 as a miner I occasionally ran 21gh and the network was 21th at the time in my garage

the network is

950eh so I need to run  950ph

or 4x950= 3,800 s21xp units

or 3,800x3.6=13,680 kwatts an hour in my garage

so now 13,360kwatts an hour

vs 10.5 kwatts in 2012

or

13,680/10.5=1,302.857

1302 x the power  to run 1/1000 of the network

coins were 12 dollars

so 12x1302= 15,624 dollars sounds good against current price of 77.7k

but 3800 s21xps cost   3800x3500= $13,300,000
 
and I paid about 21x400= $8,400 for my gear. to mine 1/1000 of the network

also I paid 10 cents a kwatt I now pay 28cents

so  2.8x per kwatt
  1300x the power
    158x the cost of gear

to mine the same 1/1000 of the network

and of course a block was 50 coins

and now a block is 3.25 coins

so 15.38x  less coins earned if you maintain the same 1/1000 of the network

[_act_]

One very good thing is that while ordinary people have to worry about their daily expenses and salaries increasing due to interest and inflation, Bitcoin miners have no reason to worry about this, because the price of Bitcoin itself keeps increasing, unlike inflation.

I am not a bitcoin miner, but I always think about a question that may be bothering bitcoin miners. The question is that 'when all bitcoinnare mined in the next century, can they only be making money from the transaction fee'?

Although 2140 is still over 100 years from now, but what also about when bitcoin mining reward halves to the extent that the mining reward is not much significant while transaction fee become more significant. This may happen sooner.

But you are right that bitcoin being deflationary has really helped miners to continue.

[stompix]

I am not a bitcoin miner, but I always think about a question that may be bothering bitcoin miners. The question is that 'when all bitcoinnare mined in the next century, can they only be making money from the transaction fee'?

Yup, definitely a concern...
But it stopped being so important once I found out that the sun won't last 5 billion years but merely 4.8 billion...
Nobody really cares what will happen in 2140 from a mining revenue point of view, like why care about a business you won't be alive to see?
Let the new generation figure it out!

Bitcoin miners have no reason to worry about this, because the price of Bitcoin itself keeps increasing, unlike inflation.

What a bunch of garbage, as a miner, you worry about
- inflation cause electricity prices go up
- you worry the coin won't go up that much to cover it
- you worry about difficulty
- you worry about your equipment
- you worry about competition

Back in 2024 you were making 10 cents per th/s , now you make 4 cents, how the fck does this nullify inflation??

[ABCbits]

Bitcoin miners have no reason to worry about this, because the price of Bitcoin itself keeps increasing, unlike inflation.

As much as we wish Bitcoin price to keep increasing, there's no guarantee it'll keep happening on long term. In addition, price volatility and declines may also harm miner's long term goal/estimation, since some of them pay electricity and other operational bill on regular miner, which means they may need to sell their BTC at lower price.

[Somegory]

Not all Bitcoin miners have free or cheap energy, they will never be fine without extreme cheap electricity.
Many are quitting, going into data center for a reason, leaving only the bitcoiners who are really mining because it's a hobby.

I know Bitcoin miners who have side jobs, yes you heard that right, because they have to eat and pay rent bills too, many Bitcoin miners who are still in business right now are doing it for the long term.

Meaning they won't sell their Bitcoin for a while, they will have to hold to make the best out of their mined Bitcoin.

[Mia Chloe]

One very good thing is that while ordinary people have to worry about their daily expenses and salaries increasing due to interest and inflation, Bitcoin miners have no reason to worry about this, because the price of Bitcoin itself keeps increasing, unlike inflation.

Your idea is highly dependent on the idea that bitcoin is gonna continue to grow and the fact is just like ABCbits mentioned it's actually not certain. The ability of bitcoin to continue to pump is highly dependent on how much it is appreciating over time. to add to this miners have expenses that are not getting cheaper by the day.

In my opinion it does seem to work fine if you are only being optimistic plus to add to this it only is gonna work if the miners actually hodl for a relatively long period of time else it will end up looking similar to taking fiat as profit.

[joniboini]

Many are quitting, going into data center for a reason, leaving only the bitcoiners who are really mining because it's a hobby.

That sounds a bit weird. I know for a fact some big pools are still operating and I doubt they're there because it's a hobby. It makes more sense to think they already made profit and anything they do is just to stockpile for future sales. Even in the case you described after this, it sounds like they're definitely here for the profit, unlike solo miners who're likely there for the fun itself.

[Outhue]

Bitcoin increasing doesn't happen in one move, it slowly climbs up and it can take Months before Bitcoin goes back to a good price where mining becomes very profitable once again, Miners are not built different from people who are going to pay bills every month and also have some responsibilities to clear, miners are humans too, they need to feed and live, it's why some of them can't maintain mining that hey had to quit, your screenshot makes mining looks too easy and that's not so true, not all Bitcoin miners are smiling even though Bitcoin value is at 77k right now.

[FP91G]

Many are quitting, going into data center for a reason, leaving only the bitcoiners who are really mining because it's a hobby.

That sounds a bit weird. I know for a fact some big pools are still operating and I doubt they're there because it's a hobby. It makes more sense to think they already made profit and anything they do is just to stockpile for future sales. Even in the case you described after this, it sounds like they're definitely here for the profit, unlike solo miners who're likely there for the fun itself.

I shared my thoughts on this matter here
https://bitcointalk.org/index.php?topic=5592172.0

Like a regular miner, I check the price of an ASIC, then open the calculator and don't understand why I need mining with an infinite return on investment.
Large pools buy equipment in bulk at deep discounts and through direct contracts with mining equipment manufacturers. There is a large price gap in the market between the average user and a large miner.

[mikeywith]

Large pools buy equipment in bulk at deep discounts and through direct contracts with mining equipment manufacturers. There is a large price gap in the market between the average user and a large miner.

Large pools run at a profit regadless because they collect fees no matter what, the operational cost of running a pool is close to nothing if you are finding blocks regularly.

If you are talking about large miners, then while what you said about the price gap is true, the more important factor is the fact that "it's other people's money".

Hear me out, ALL U.S large mining firms are fundamentally losing money on a pure net income basis, I don't give a fudge what their reports say, the reality is they continuously print and sell new shares of their own stock to the retail investors, it's a massive bubble that only God knows when is it going to burst, but history had showed us many times that all bubbles shall burst.

So the gap you talked about is even larger, it is your hard earned money vs a bunch of stupid investors that keep pouring money into a highly competitive business, you simply can't keep up with them unless you have free electricity and lots of patience.

[FP91G]

Large pools buy equipment in bulk at deep discounts and through direct contracts with mining equipment manufacturers. There is a large price gap in the market between the average user and a large miner.

Large pools run at a profit regadless because they collect fees no matter what, the operational cost of running a pool is close to nothing if you are finding blocks regularly.

If you are talking about large miners, then while what you said about the price gap is true, the more important factor is the fact that "it's other people's money".

Hear me out, ALL U.S large mining firms are fundamentally losing money on a pure net income basis, I don't give a fudge what their reports say, the reality is they continuously print and sell new shares of their own stock to the retail investors, it's a massive bubble that only God knows when is it going to burst, but history had showed us many times that all bubbles shall burst.

So the gap you talked about is even larger, it is your hard earned money vs a bunch of stupid investors that keep pouring money into a highly competitive business, you simply can't keep up with them unless you have free electricity and lots of patience.

You understood me correctly when I wrote about large mining companies. These companies also have their own pools.

You have an interesting idea about mining companies' profits, but I disagree. A mining company needs to find an investor to buy new shares, and if I owned shares in such a company and didn't like its policies, I would sell my shares and buy shares in a more stable company.