The mining of bitcoins is no longer a lucrative business. After the number of big players in this segment increased significantly, mining became less efficient. According to Morgan Stanley’s estimates, with the bitcoin cost below USD 8,600 most miners will likely decide that mining is unprofitable.
“The break-even point for big mining pools should be USD 8,600, even if we assume a very low electricity cost (USD 0.03 kW/h). Therefore, we think the Bitcoin mining hardware demand and price will decline further and affect TSMC's wafer demand,” the report of Morgan Stanley said. Mining can bring steady profits only if the cryptocurrency No1 demonstrates steady growth. However, for the past several months bitcoin has been trading at low levels. Besides, with the increasing global hash rate, mining becomes more complicated. Nowadays, expensive and energy-intensive equipment is needed even at the base level of mining.
So, Morgan Stanley’s forecast implies that under the present conditions mining is not profitable. Anyway, even if the digital currency recovers and gains the previous pace of growth, profits will likely continue to decrease.
