ViaBTC Introduction｜What Is BTC “Shutdown Price”?
When the BTC price keeps falling, the key concern for many users and miners is whether the price will plunge below the shutdown price. For users new to the mining industry, the term “shutdown price” may seem confusing at first glimpse. The shutdown price is an intuitive indicator of the profit and loss of a mining machine. Since electricity is consumed as the mining machine works, this power charge constitutes its operation cost. Further, when the mining profit fails to cover the electricity cost, continued mining incurs losses, at which time the miners will have to shut down their operation. The BTC price in such cases is called the shutdown price of mining machines. You can also take it as the cost price of mining.
The shutdown price is calculated based on the specific mining parameters, covering power consumption, hashrate, electricity price, mining difficulty of the network (hashrate), and the proportion of miner fees in the profit structure.
Based on inference, the formula for calculating the shutdown price is:
Daily mining profit = (hashrates*86,400/mining difficulty of the network/2³²) * (block rewards + miner fees)
Shutdown price = electricity price * power consumption * 24 / daily mining profit
For Antminer S19, according to official data, the machine has a power consumption of 3,250W and a hashrate of 95 T. The electricity fee is calculated at $0.077 per kilowatt-hour (power charge standard in China). Meanwhile, from statistics on August 26, the latest BTC mining difficulty, the hashrate of the BTC network, and the weekly average miner fee/block reward are 17.62T, 129.74 EH/s, and 1.3%, respectively.
Then, the daily mining profit = (95*24*60*60/17.62/2³²)*(6.25+6.25*1.3%) = 0.00068685 BTC
Shutdown price = 0.077*3.25*24/0.00068685 = $8744.27
In the case of the Whatsminer M30S+, the power consumption and hashrates are 3,400W and 100T.
Then, the daily mining profit = (100*86400/17.62/2³²)*(6.25+6.25*1.3%) = 0.000723 BTC
Shutdown price = 0.077*3.4*24/0.000723 = $8690.18
According to the above process, we managed to determine shutdown prices of some mainstream mining machines:
The current shutdown price of mainstream mining machines is around $10,000. According to data on August 26, the BTC price has been fluctuating around $47,000, indicating that miners still benefit from considerable profits. At the current price, there is still room for mining with older models. However, outdated models with shutdown prices exceeding $47,000, such as Antminer S7, AvalonMiner A721, and Whatsminer M3, can no longer be used for mining. The profit margin of machines like Antminer T9+ is also very limited, considering their shutdown price has reached $36,754.
In addition to electricity, mining also incurs costs such as operation and maintenance costs (charged by mining farms), service fees (charged by mining pools), and machine costs. Therefore, other than the shutdown price, a wide range of other costs must also be taken into consideration.
Furthermore, power charges vary significantly in different regions. For instance, in the Russian-speaking regions, the electricity fee is about $0.054 per kilowatt-hour; in Northern Europe, the power charge is around $0.1 per kilowatt-hour; and South America charges $0.031 per kilowatt-hour of electricity fee. This is why shutdown prices drastically differ among regions. For example, according to calculations based on the above figures, the shutdown prices of the same Antminer model in the Russian-speaking regions, Northern Europe, and South America are $6,132.34, $11,356.19, and $3,520.42, respectively.
On the whole, as long as miners manage to maintain a level of hashrates and stable block generation, most of them can still make handsome profits. The shutdown price only serves as a reference based on the current market conditions, and the actual shutdown price also fluctuates in line with the mining difficulty and electricity prices.