In the last year electricity prices have more than doubled for many. Bitcoin prices have dipped and dipped to the point the average cost to mine 1 BTC is around $3,600 over the current value of 1 BTC.
This loss is around 21% of BTC's current price.
While I believe there will always be someone mining Bitcoin regardless how profitable it is (or isn't), a lot of Bitcoin miners will give up. The difficulty will automatically scale to try to keep a regular 10 minute interval. The difficulty is re-addressed roughly every two weeks (2,016 blocks) which is called an epoch.
So while you don't have to worry about miners quiting and making BTC too easy to mine, you do have to worry about miners quiting and centralizing it to fewer unique parties as many run very large operations. This is less of a problem when BTC is selling for $50K-60K, but as BTC dips it becomes more of an issue.
There are many who are predicting a sub $10K BTC soon, or even as low as $8K from some predictions. If this happens, this problem will just get worse. At some point it is just a better investment to buy BTC than to try to mine it, unless you have super low electricity costs.
Low electricity costs can only be found in very few countries (typically Russia and China). China has banned Bitcoin mining, but it still happens a lot. In fact, recently it has been reported the Communist Party has plead guilty to financially supporting Bitcoin miners. It is reported at least $18M USD worth of bribes were accepted to aid in construction and promotion.
“During his 2017 to 2021 tenure as the Communist Party Secretary of the City of Fuzhou, Xiao Yi provided support to cryptocurrency mining companies in the form of subsidies, capital aid, and electricity assurance. These acts were contrary to national regulations, the theory of New Development, and led to massive losses in public property, leading to adverse consequences.”
-Xinwen Lianbo
Canada is another country with relatively low electricity costs in some areas. I actually looked at Canada a few years ago to buy a run down house and just setup a mining operation.
As the profits decline, the diversity of miners declines along with it. This increases risk and the centralization factor.
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