If 9 out of 10 mining investments are unprofitable, then who will buy mining equipment?
Strategy used a DCA strategy and now has an unrealized loss of 25%, or approximately $17 billion. And miners are starting to change their strategy and use some of their energy capacity for AI.
The majority are clueless people or people who gamble with other people's money, you look at all the major U.S mining firms, the people in charge have nothing at stake, the more gears they buy the more money they make, many get a cut from Bitmain, the custom firmware they use and the mining pool, it's a bubble built on other investors' money just like many other industries.
You don't have to tell us about a certain company did this or that, Bitcoin price is public data, think of the worst random DCA of buying btc for an entire year then selling it the next year (you sell on Jan what you bought the previous Jan) Win probability: ~70–75% Loss probability: ~25–30%, if you did 2 years DCA and 1Y selling its 90%, again chance am talking about random selling not waiting for price to hit a certain figure.
In fact, even buying on the WORST day could possibly pick you will end up in green in roughly 3 years.
Today, you can buy 10 S21s XPs for 0.6
BTC or buy 0.6BTC and hodl it, the 10 gears will generate the 0.6BTC back in 1.5 years assuming difficulty stays flat, in that period you have burnt 864kWh every signle day thats 17$ a day at 2 cents or 50$ at 6 cents, we can take 4 cents as a very cheap sustainable number puts you at 35$ a day or a total of roughly 20k USD which is another 0.3 BTC you are going to burn, the that time, it is very unlikely that the 10 gears will still be running, difficulty would have skyrocket before you hit your 0.6BTC in other words there is a 90% that NOBODY who buys 10 xps today ever gets to mine 0.6BTC.
You may think its funny, but save this comment and come back to it at anytime, let's do 2 years? 3? you pick
If you search the forum you will find me doing the same math on S19s,people paid 0.5 btc to buy them back then, almost nobody could have mined a half btc with an S19, i said the same thing to them back the, save my comment and come back whenever you want, its been 5 years now, nobody have come forward.
Personally, I have spend dozen BTCs on mining gears, nobody here had access to cheaper power than I had, i had free 2MW farm back when 2MW was a lot of gears, yes I made a lot of money, but had I kept all the BTC i spend on mining gears and infrastructure i would have been a millionaire now, am i a millionaire now with years and years of mining? not even close.
I have made a difficult decision of quiting mining, a late one to be honest, looking back at it now, am glad I did, wish I understood the game earlier, I guess people will eventually understand on their own when they trully run the numbers.
You've touched on the age-old theme that Bitcoin spent on ASICs won't pay off. If you choose a strategy of mining when the price is low and selling when the price is high, then mining is profitable.
This is reminiscent of the supermarket strategy when a store opens in a new, newly built area and suffers losses for the first couple of years because very few people visit it, but then turns a healthy profit. And competitors can't open new stores; all the spots are already taken.