Energy and cost efficiency of Bitcoin mining endeavor
The main aim of the study is to analyze BTC mining’s efficiency under current market conditions (December 2021), including soaring energy prices produced from many different sources in different geographical locations. After a thorough analysis of initial assumptions concerning the (1) price of mini...
| Main Authors: | , , , , , |
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| Format: | Article |
| Language: | English |
| Published: |
Public Library of Science (PLoS)
2023-01-01
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| Series: | PLoS ONE |
| Online Access: | https://www.ncbi.nlm.nih.gov/pmc/articles/PMC10062675/?tool=EBI |
| _version_ | 1797852111993569280 |
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| author | Małgorzata Jabłczyńska Krzysztof Kosc Przemysław Ryś Paweł Sakowski Robert Ślepaczuk Grzegorz Zakrzewski |
| author_facet | Małgorzata Jabłczyńska Krzysztof Kosc Przemysław Ryś Paweł Sakowski Robert Ślepaczuk Grzegorz Zakrzewski |
| author_sort | Małgorzata Jabłczyńska |
| collection | DOAJ |
| description | The main aim of the study is to analyze BTC mining’s efficiency under current market conditions (December 2021), including soaring energy prices produced from many different sources in different geographical locations. After a thorough analysis of initial assumptions concerning the (1) price of mining machine with associated components and its effective amortization period, (2) difficulty and the hash rate of the BTC network, (3) BTC transaction fees, and (4) energy costs from various sources, we have found that currently, BTC mining is not profitable, except for some rare cases. The main reason for this phenomenon is the fast and unpredictable increase of difficulty of the BTC network over time which results in decreasing participation of already purchased mining machines in the BTC network hash rate. The research is augmented with a detailed sensitivity analysis of mining efficiency to initial parameters assumptions, which allows observing that the conditions for BTC mining to be efficient and profitable are very challenging. |
| first_indexed | 2024-04-09T19:27:38Z |
| format | Article |
| id | doaj.art-5c8be54d77b94a9daa9f5b35f551c407 |
| institution | Directory Open Access Journal |
| issn | 1932-6203 |
| language | English |
| last_indexed | 2024-04-09T19:27:38Z |
| publishDate | 2023-01-01 |
| publisher | Public Library of Science (PLoS) |
| record_format | Article |
| series | PLoS ONE |
| spelling | doaj.art-5c8be54d77b94a9daa9f5b35f551c4072023-04-05T05:31:48ZengPublic Library of Science (PLoS)PLoS ONE1932-62032023-01-01183Energy and cost efficiency of Bitcoin mining endeavorMałgorzata JabłczyńskaKrzysztof KoscPrzemysław RyśPaweł SakowskiRobert ŚlepaczukGrzegorz ZakrzewskiThe main aim of the study is to analyze BTC mining’s efficiency under current market conditions (December 2021), including soaring energy prices produced from many different sources in different geographical locations. After a thorough analysis of initial assumptions concerning the (1) price of mining machine with associated components and its effective amortization period, (2) difficulty and the hash rate of the BTC network, (3) BTC transaction fees, and (4) energy costs from various sources, we have found that currently, BTC mining is not profitable, except for some rare cases. The main reason for this phenomenon is the fast and unpredictable increase of difficulty of the BTC network over time which results in decreasing participation of already purchased mining machines in the BTC network hash rate. The research is augmented with a detailed sensitivity analysis of mining efficiency to initial parameters assumptions, which allows observing that the conditions for BTC mining to be efficient and profitable are very challenging.https://www.ncbi.nlm.nih.gov/pmc/articles/PMC10062675/?tool=EBI |
| spellingShingle | Małgorzata Jabłczyńska Krzysztof Kosc Przemysław Ryś Paweł Sakowski Robert Ślepaczuk Grzegorz Zakrzewski Energy and cost efficiency of Bitcoin mining endeavor PLoS ONE |
| title | Energy and cost efficiency of Bitcoin mining endeavor |
| title_full | Energy and cost efficiency of Bitcoin mining endeavor |
| title_fullStr | Energy and cost efficiency of Bitcoin mining endeavor |
| title_full_unstemmed | Energy and cost efficiency of Bitcoin mining endeavor |
| title_short | Energy and cost efficiency of Bitcoin mining endeavor |
| title_sort | energy and cost efficiency of bitcoin mining endeavor |
| url | https://www.ncbi.nlm.nih.gov/pmc/articles/PMC10062675/?tool=EBI |
| work_keys_str_mv | AT małgorzatajabłczynska energyandcostefficiencyofbitcoinminingendeavor AT krzysztofkosc energyandcostefficiencyofbitcoinminingendeavor AT przemysławrys energyandcostefficiencyofbitcoinminingendeavor AT pawełsakowski energyandcostefficiencyofbitcoinminingendeavor AT robertslepaczuk energyandcostefficiencyofbitcoinminingendeavor AT grzegorzzakrzewski energyandcostefficiencyofbitcoinminingendeavor |