Bitcoin miners are forced to look for cheaper electricity

2022 has been a reality check for many bitcoin miners after the super-profitable 2021. This article discusses how mining profitability has changed and explains how only miners with access to exceptionally cheap energy will survive in the long term.
Source: Hashrate Index, CoinMetrics

A bitcoin miner turns electricity into bitcoin. Therefore, the most precise way of measuring bitcoin mining profitability is to look at miners' break-even power prices. The break-even power price is the revenue per MWh of energy fed into a bitcoin mining machine. If this number is lower than the price the miner pays for this MWh, the miner should turn off its machines.

According to Bitooda's estimates from 2021, the median power price in the bitcoin mining industry is $40 per MWh. This median price might have increased slightly due to inflation, but at the same time, as I will explain in this article, miners with higher electricity prices have been forced out of the industry. Therefore, I view the median power price of $40 per MWh as reasonably accurate.

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