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Comment by why_only_15 | Hacker News Reader

If you have to pay $50k in electricity to mine a $40k bitcoin, it would be better to just turn off the mine and buy the bitcoin directly.

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Some industrial scale miners might have commitments to buy electricity at a certain rate. It could be more expensive to break a contract than to keep their equipment running when the exchange rate temporarily falls below profitability.

Also not everyone has easy access to an exchange. Others may prefer to avoid the KYC paperwork, or simply be willing to pay a premium for freshly mined coins.

There's a healthy power market - so the providers can and should work out a way for their clients to exit their contract and for them to sell the electricity elsewhere.

Sure the client might be liable for some loss-of-earnings fees but this really should be better for everyone than this.

Sure, but also take into account that a mining operation large enough to enter into electricity contracts probably has other obligations like facilities and staff. Overall it may not be worth the hassle to shutdown for what could be interpreted as typical exchange rate fluctuations.

This assumes you have a source of income, outside of your mining operation.

Not if you have all that money tied up in an old mining rig which has close to zero resale value.

No, if you need 50k for electricity, it does not matter how much money you put into the mining rig, you're better off buying 40k bitcoin directly.

Sunk cost fallacy

If all your money is gone because you spent it on a mining rig, how will you pay the electricity bill

Can mining rigs be repurposed for anything useful?

Nope, the ones in the article are ASICs, so specifically for bitcoin. There are GPU based ones but the number of coins that you can mine with them is dwindling. You could probably reuse the beaglebone black or whatever little auxillary computer they're using but it's not really worth it. It's just e-waste.

Depends what they actually are, some 'mining rigs' are just PCs with lots of beefy GPUs, so yeah.

Others are FPGAs programmed to compute the hash for whatever cryptocurrency (e.g. BTC is `sha256(sha256(x))`); they can be re-programmed to do something else instead.

Others are ASIC (Application-Specific Integrated Circuits) based, physical chips designed to do nothing else but compute those hashes. So essentially 'no', but 'yes and they'd be very good at it' if you for some reason had another use for that particular hash function (lots and quickly).

That's also a progression of cost & performance, by the way. As the difficulty increases GPUs get slower at finding whatever coin, and people (pay a bit more and) move to FPGAs, and then again to dedicated ASIC hardware.

Not really they're extremely specialized chips that only do lots of hashes fast. They can't even be used for an different blockchain unless it's block hashing is similar enough and uses the same algorithm.

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