Bitcoin mining is the process of adding new transactions to the blockchain by solving complex mathematical equations using specialized hardware. The process is called “mining” because it is similar to the way gold is mined from the ground. The more computing power you have, the more chances you have to solve the equations and earn new bitcoins as a reward.
One measure of computing power in the Bitcoin network is the hash rate, which is the number of calculations that can be performed per second. The hash rate is measured in hashes per second (h/s), kilohashes per second (kh/s), megahashes per second (mh/s), gigahashes per second (gh/s), terahashes per second (th/s), and petahashes per second (ph/s).
As of August 2021, the total hash rate of the Bitcoin network is around 130 exahashes per second (EH/s), which is equivalent to 130,000,000 terahashes per second (TH/s) or 130,000 petahashes per second (PH/s). This means that the network can perform 130 quintillion calculations per second.
However, not all of the hash rate comes from professional miners. Some of it comes from hobbyists who mine with their personal computers or graphics cards. Others come from companies that provide cloud mining services, where customers rent hash rate from them.
So, how much does it cost for 1 petahash of Bitcoin mining? The answer depends on several factors, such as the cost of electricity, the cost of hardware, and the mining difficulty.
The cost of electricity is the most significant factor in Bitcoin mining. Mining requires a lot of electricity to power the hardware and keep it cool. The cost of electricity varies depending on the location and the source of the power. In some countries, such as China and Iran, electricity is relatively cheap, as low as $0.03 per kilowatt-hour (kWh). In other countries, such as Germany and Denmark, electricity is more expensive, around $0.30 per kWh.
Assuming an average electricity cost of $0.10 per kWh, running 1 petahash of mining hardware would require around 1.5 megawatts (MW) of power. This would cost around $15,000 per month or $180,000 per year. However, the actual cost would vary depending on the efficiency of the hardware and the cooling system.
The cost of hardware is another significant factor in Bitcoin mining. Mining hardware is specialized equipment that is designed to perform the specific calculations required for mining. The most common types of hardware are ASICs (application-specific integrated circuits), which are designed to perform only one task, mining Bitcoin.
The cost of an ASIC miner varies depending on the model and the manufacturer. The most popular models are made by Bitmain, a Chinese company that dominates the market with its Antminer series. The latest model, the Antminer S19 Pro, can achieve a hash rate of 110 TH/s and costs around $10,000. To achieve 1 PH/s, you would need around 10 of these devices, which would cost around $100,000.
However, the cost of hardware is not the only expense in Bitcoin mining. Hardware also requires maintenance, such as replacing faulty components and upgrading firmware. This can add up to several thousand dollars per year per device.
The mining difficulty is another factor that affects the cost of Bitcoin mining. Mining difficulty is a measure of how hard it is to find a valid block hash. As more miners join the network, the difficulty increases to maintain a target block time of 10 minutes. This means that as the network hash rate increases, the rewards for mining decrease. Therefore, miners need to upgrade their hardware to stay competitive.
As of August 2021, the mining difficulty is around 15 trillion. This means that to earn 1 Bitcoin per day, you would need around 150 PH/s of hash rate, which would cost around $15 million in hardware alone. However, it is important to note that this is a theoretical calculation and does not take into account the cost of electricity and maintenance.
In conclusion, the cost of 1 petahash of Bitcoin mining depends on several factors, such as the cost of electricity, the cost of hardware, and the mining difficulty. Assuming an average electricity cost of $0.10 per kWh and the cost of an Antminer S19 Pro, it would cost around $115,000 to achieve 1 PH/s. However, this is just the hardware cost and does not take into account the ongoing expenses of electricity and maintenance. Bitcoin mining can be a profitable venture if done correctly, but it requires a significant investment and a deep understanding of the market.
