Just last week Core Scientific raised their electricity rates for their hosting customers to about $0.10/kWh.
Every single miner hosting with Core Scientific who isn’t running an S19 XP or an S19 Pro with Braiins OS+ firmware is currently mining at a loss. According to its most recent monthly update, the company self-mines 13 EH/s produced by roughly 130,000 ASICs and hosts 102,000 ASICs producing 9.5 EH/s. I think it’s safe to say that most of these machines aren’t S19 XPs considering they just started deploying that model in July 2022. With that being said, Core Scientific’s self-hosted miners are probably mining at lower than $0.10/kWh considering they own the power purchase agreement and are likely mining at cost while charging hosting customers a higher rate to produce a margin for their business. Still, this is not an ideal environment for Core Scientific or any other miner with an all-in electricity cost above $0.06/kWh.
This all begs the question, “Why the hell is the hash rate still screaming?”
From what I have heard, a lot of projects that have been in development for well over a year in Texas just got electrified at the beginning of the month. These teams spent tens of millions of dollars in infrastructure costs and went through the administrative troubles that come with connecting to ERCOT. They weren’t going to reach the finish line and not turn on their ASICs. As it stands today, the mining industry seems to be caught in a game of “who can hold their breath the longest.” How long can these market conditions continue without countless miners having to turn off their machines so they stop losing money, or worse file for bankruptcy?
Compute North was the first domino to fall almost a month ago when they filed for bankruptcy. Your Uncle Marty expects them to be the first of many unless the price rips or some on-grid mega mine has a critical error that turns their machines off. Neither situation is what you want to be banking your business on if you’re a bitcoin miner.