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Data reveals the price of mining Bitcoin has now surged as much as $19.3k, one thing that would spell doom for the miners.

Bitcoin Difficulty Regression Model Shows Cost Of Production Now $19.3k

As per the most recent weekly report from Glassnode, the price of BTC manufacturing has gone up just lately as a result of hashrate and issue setting new all-time highs.

The “difficulty regression model” is an estimated common price of manufacturing for Bitcoin that bases its worth on the mining difficulty.

This issue is a function of the BTC blockchain that controls how a lot hashes miners might want to make with the intention to mine a block on the community.

Whenever the hashrate (the full computing energy related to the chain) goes up, so does the problem for the reason that community desires to maintain the block manufacturing fee fixed.

The issue regression mannequin doesn’t make use of any elaborate knowledge on mining tools, energy, and different prices that miners face, but it surely merely calculates a mean price with the belief that the mining issue already accounts for all these variables in a single quantity.

Now, here’s a chart that reveals the development on this Bitcoin price of manufacturing mannequin over the previous few years:

The worth of the metric appears to have gone up in current days | Source: Glassnode's The Week Onchain - Week 43, 2022

As you’ll be able to see within the above graph, the Bitcoin issue regression mannequin has elevated in worth throughout the previous few weeks.

The purpose behind this progress lies within the aggressive rise within the hashrate just lately, which has result in a problem explosion within the crypto.

After this enhance in the price of manufacturing, miners need to incur a mean expense of round $19.3k in the event that they wish to mine 1 BTC.

This worth occurs to be about what the precise worth of Bitcoin has been transferring sideways round just lately. This signifies that at current, the typical miner can be making little to no revenue, if not taking an outright loss.

The report notes that the final time the price of manufacturing exceeded the worth itself was again in the midst of 2018, which triggered a miner capitulation that continued for a lot of months after.

So, if the problem regression mannequin retains rising from right here on, and the BTC worth doesn’t discover any enhancements, then an identical capitulation occasion may happen once more.

BTC Price

At the time of writing, Bitcoin’s price floats round $19.5k, down 1% within the final week.

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Looks like the worth of BTC has surged above the mining manufacturing price for now | Source: BTCUSD on TradingView

Featured picture from mana5280 on Unsplash.com, charts from TradingView.com, Glassnode.com