In a research report published by JPMorgan, Bitcoin (BTC) miners with a mix of low electricity costs and high sustainable energy are the only companies that can survive in an increasingly competitive environment.
Bitcoin Miners with a High Sustainable Energy Mix Will Survive, According to JPMorgan
In the report, which stated that the main cost in mining is electricity and this affects the overall cost of Bitcoin (BTC) production, it was stated that miners are looking for cheaper and sustainable energy sources to maintain their profitability.
Stating that electricity prices have fallen especially in the USA, where most Bitcoin mining companies are located, the bank noted that the USA is the largest Bitcoin hashrate participant.
Hashrate refers to the total combined computing power used to mine and process transactions on a proof-of-work blockchain such as Bitcoin. This means that the number of machines actually mining is high.
Analysts led by Nikolaos Panigirtzoglou wrote, “Low electricity costs should help contain the rise in Bitcoin production cost in the current phase of increased Hashrate.”
The average electricity price for Bitcoin (BTC) miners globally is around $0.05 per kilowatt hour (kWh), although some major mining firms can pay as little as $0.03/kWh, the report said.
Over time, JPMorgan says the bitcoin mining industry will consolidate and become more competitive because only miners with lower production costs can survive.
The report also noted that miners are trying to diversify their power mix with renewable sources to be more environmentally friendly.
*Not investment advice.
