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Jatin Shah
Jatin Shah
Software Engineer Data II at Truist
Published Sep 7, 2023
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Bitcoin mining is getting expensive in each state in the US and across world. Currently, if we take the example of California average cost of mining 1 BTC is around $35K in general unless using their own renewable energy source, while in Hawaii it is higher than in CA. Which is way higher than the current BTC price as of today. It also keeps increasing due to uncertainty in power cost and inflation.
On the other hand, 1 ETH mining cost is around $150 while 1 ETH price is around $1.6K. If we compare 1 BTC with 1 ETH mining cost-to-profit ratio is higher in Ethereum.
Bitcoin halving is coming next year as a result mining costs will be doubled. which means mining in California will cost almost around $60K. Investment in BTC will be worth more than mining in the near future if 1 BTC price reaches to price mark of more than $60K. But it's still a $30K question for miners that will 1 BTC will reach the price mark of $60K.
On the other hand, Ethereum is following a burning mechanism. Till now more than 3.5M+ ETH burned from its total supply. It will also push the ETH price up as not much difference between new Ethereum mining vs. Ethereum burned.
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As a result, it is a question for BTC miners' dilemma whether to switch from BTC mining to ETH mining or move to different locations where mining costs it really low. Analysts are expecting BTC to reach a $100K level in the next few years. Futuristic As a more and more halving event occurs, BTC mining cost and its value should be doubled. Lower mining cost of ETH may attract more miners than BTC since mining ETH is more profitable than BTC. Although BTC is compared with GOLD while ETH is compared with SILVER. Which means BTC is looked as more profitable asset than ETH. It also creates confusion whether to mine BTC or ETH and so on.
I am as an individual investor I am a big believer in BTC and ETH both. But when I asked the same question to CHATGPT, it did not have an answer either. So, the future is the key to finding answers from the miners themselves.
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