It is shown that profitability of mining of Bitcoin dropped sharply as price of Bitcoin crashed. It is indicated that one will actually lose hundreds of dollars by mining one Bitcoin.
According to an American economic media called CNBC, Morgan Stanley, which is a global investment bank, estimated that production cost of mining one Bitcoin based on professional miners is about $8,600. Considering that current price of Bitcoin is between $8,200 and $8,300, one will actually lose between $300 and $400 by mining one Bitcoin.
Mining is when a person receives Bitcoin as compensation for performing complicated calculations to create and connect blocks that have information on transactions. Because it requires high-performance computers, cooling systems, and enormous amount of energy, production cost of mining is set at a high price.
Although many people formed ‘mining pool’ where they can share resources to lower production cost and increase efficiency in mining, it has become difficult to make profits off mining as competitions became more intensified recently.
“As number of demands for miners of Bitcoin drops, Bitcoin price will drop as well.” said Charlie Chan who work as a research associate for Morgan Stanley. “TSMC, which has been enjoying increased demands of cryptocurrency, will be affected as well.” TSMC actually lowered this year’s prediction on increase rate of its sales from between 10 and 15% to 10% and it explained that uncertainty of demands related to mining of Bitcoin made it lower its prediction. Morgan Stanley is estimating that equipment related to mining is responsible for 10% of TSMC’s overall sales.
“TSMC, which is the world’s biggest semiconductor foundry business, has been enjoying increased demands of ASIC (Application Specific Integrated Circuit) that is for manufacturing miners of digital money.” said Nihon Geizai Shimbun. “However, number of demands for miners has been dropping while iPhone sales from Apple, which is its biggest customer, has been on slump.”
Staff Reporter Gil, Jaeshik | osolgil@etnews.com