Brian Venturo, Co-founder of a mining farm with 3,000 GPU rigs called Atlantic Crypto, stated this Monday that at just $0.12 kilowatt per hour it costs only $152 to mine one eth. He says:
“If you assume an average electric cost of 12c/kWh… and with the Purchasing Power of 1 ETH currently equaling 1.27 MWh would equate to a value of USD 152 per ETH.”
That’s nearly half of eth’s current price at ~$300, with 12 cent being the average price in US and UK for residential homes.
Within US, there are huge variations between states. One estimate, for example, says in Idaho, North Dakota and Washington the average for residential homes is just 8 cent, making it at just $100 mining cost for 1 eth.
That’s about 33% less, same as Ethereum’s Improvement Proposal (EIP) 1234 which proposes to reduce issuance by 33% to 2eth.
Moreover, within US miners tend to go to areas with excessive energy where the cost can be as low as 4 cent, or just $50 per eth. In China it might be even cheaper, making the electricity cost of mining one eth at a lower end of 6x less than its current price of around $300.
That suggests mining eth would still be very profitable at even 1 eth per block, a 3x reduction. That’s at current prices, with Eric Connor, a long time etherean, estimating by how much eth would be overpaying for security compared to bitcoin at 2eth per block:
At 1eth per block he says ethereum would be slightly underpaying for its security, but that’s potentially still fine, he says.
A developer’s meeting this Friday is now to decide whether ethereum’s issuance and inflation rate should be reduced, and if so by how much.
A vote of etherean holders has around 80% in favor of a reduction to 1eth. The other roughly 20% are in favor of reducing it to 2eth with all of them pretty much unanimously being of the view that it should be reduced to 2eth or 1eth.
Even some miners were in favor of a reduction to 2eth or 1eth according to a statement by Ethermine read during last Friday’s meeting. Whether a general agreement will be found this Friday, however, remains to be seen.