In 2018, the new question that arises is whether mining bitcoin is a profitable activity or not anymore. The truth is that for some miners, with specific conditions, mining can be really profitable. In China, bitcoin miners are able to work even if Bitcoin loses 50% of its price. Let’s have a look why.
Chinese Miners Not Worried About Corrections
According to Bloomberg New Energy Finance, Chinese miners could still make money even if bitcoin loses half of its value. Miners will be profitable as long as Bitcoin is worth more than $6,925 dollars.
China is one of the countries with the highest number of bitcoin miners in the world. Some experts believe that about three-quarters of the mining power is located in this Asian country. As we have reported at UseTheBitcoin, China is trying to discourage the practice by modifying some electricity prices. But the government is not planning a ban on cryptocurrency mining farms.
The main problem about this activity in the country is that lots of industries and towns were paying higher prices for electricity because of the bitcoin mining farms. China has some hydroelectric power plants that reduce the price of electricity. Most of the miners are located near them in order to reduce costs.
Sophie Lu, part of the team that wrote the analysis about the mining situation in China explained that Bitcoin mining will be a profitable activity at the current price under any electricity price regime in China.
Some Bitcoin miners are paying for electricity prices as low as $0.03 dollars per kilowatt-hour. And Mining would be still profitable at $0.13 dollars per kilowatt-hour. Lu believes that the overall threat to the sustainability of the global bitcoin network is not so drastic as expected. And if China decides to increase electricity prices, the mining activity can be easily moved from one country to another. The equipment needs to be changed approximately every two years and the other costs are not so big to install the mining farm in another country near China with low electricity prices.