BTC Production Cost
**What it costs the mining industry to produce one bitcoin**, from the electricity their machines burn. Price has spent most of its history above this line; the times it fell below were short and came near market bottoms. It is a cost, not a floor — nothing forces the price to respect it.
The electricity cost of producing one bitcoin, computed in-house. Three lines, separated only by how old the machine is: the most efficient machine available that day (floor), the machines a typical fleet runs — about two years behind the best (middle), and the oldest units still earning their keep, about five years behind (ceiling).
Price inside or below the band means the older half of the network spends more on electricity than a freshly mined coin is worth. Miners can run at a loss for a while, but not forever — the weakest switch off, selling pressure dries up, and both prior deep touches (December 2018, November 2022) sat at bear-market bottoms. It is a pressure gauge, not a call to buy.
Electricity per coin = difficulty x 2^32 / 1e12 / 3,600,000 / block subsidy. That is the kilowatt-hours one coin takes for each unit of machine efficiency (J/TH); multiplying by a machine's J/TH and by an electricity price gives dollars. Drawn at $0.05 per kWh. Difficulty is used rather than hashrate because difficulty x 2^32 IS the expected number of hashes behind a block by protocol definition, however fast the network happens to run — hashrate is only ever an estimate inferred from it. Because every line is the same number times an efficiency, the whole chart scales exactly with the electricity price.
Electricity only — hardware, cooling, housing, staff, pool fees and capital are not included, so the true all-in cost sits above these lines. The $0.05 per kWh the chart is drawn at is a network-average assumption: the largest listed miners reported $0.027-$0.04 for the most recent quarter, while a European household pays several times that. How far a fleet lags the frontier (two years for the middle line, five for the ceiling) is the only judgement on this page, and it is an assumption, not a measurement. Machine efficiencies are the manufacturers' rated wall-plug figures; real sites measure a few percent worse, so every line reads as a floor rather than a target. The lines step rather than curve because difficulty only changes about every two weeks. Coverage begins in November 2013 with the first rated ASIC; the earliest years rest on a handful of machines we could source, so treat that stretch as indicative.
Computed in-house from Bitcoin's own difficulty and issuance schedule, our stored daily closes, and published ASIC efficiency ratings (asicminervalue.com, hashrateindex.com, original vendor announcements). No third-party energy model is used.
Computed in-house from Bitcoin's difficulty and issuance schedule plus published machine efficiency ratings