Rising electrical costs in the United States have increased Bitcoin mining prices. Investopedia explains, “Bitcoin mining is the process of validating the information in a blockchain block by generating a cryptographic solution that matches specific criteria. When a correct solution is reached, a reward in the form of bitcoin and fees for the work done is given to the miner who reached the solution first.”
Since the process takes so much energy, the increase in energy prices means a decrease Bitcoin miners see in revenue.
“The rising electrical energy charges in the USA have contributed to the rising Bitcoin mining prices, making it much less worthwhile for miners…. The price of electrical energy is a number one expense for Bitcoin miners, because the mining course of requires an unlimited quantity of vitality. The Bitcoin Power Consumption Index estimates that the Bitcoin community consumes extra vitality than [the] entire nation of the Philippines. The electrical energy consumption is primarily pushed by the necessity to energy the [specialized] pc gear used within the mining course of, which requires huge vitality.” writes Crypto News BTC.
The outlet noted, “One other issue contributing to the rising electrical energy charges is the surge in electrical energy demand. Because the inhabitants grows and extra folks use electrical energy, the necessity will increase, driving up the fee. This elevated demand has been notably evident in locations similar to California, the place the inhabitants has proliferated, resulting in a pressure on the state’s energy grid and inflicting rolling blackouts.”
But New Mexico is seen as a leader for Bitcoin miners, per the report, noting, “New Mexico has comparatively low cost electrical energy costs, making it one of many extra inexpensive states for Bitcoin mining. Per the Hashrate index report, New Mexico emerged as probably the most affordable and, in [turn], extra worthwhile state for Bitcoin miners in [the first quarter of 2023] at $16,850 to mint one BTC.”
According to the report, “In 2023, the electrical energy charge continues to [hit] new highs, which doesn’t come as a shock. Bitcoin miners require no less than $17,000 to supply one BTC in the USA versus the $5,000 to 10,000… in the past. That is based on the Bitcoin mining information useful resource Hashrate Index and Luxor.”
With the revelation that New Mexico is on the map for affordable Bitcoin mining, it could mean more miners relocate to the state for this purpose.