Bitmex Report Shows Both BCH Camps Mining at a Loss in Hash War

A Bitmex report shows that both BCH camps, ABC and SV, are mining their respective chains at a loss in the current hash war.

This is compared to Bitcoin in which major miners are still mining at a profit.

This data is interesting on one hand, but it is also telling in a few ways.

1. According to Bitmex miners are still in the green when it comes to BTC. If nothing else changes they won’t start operating at a loss until if and when BTC hits $3,341 (this doesn’t mean causal miners have these profit margins; casual miners tend to spend more to mine a block between pool fees, hardware costs, and electricity costs).
2. The hash war is expensive. Deploying excessive hash power means that blocks are harder to mine. Pair that with price declines and the splitting of the former BCH price between two coins and each camp is mining at a loss. That is not sustainable, so it is a game of chicken unless the price of both ABC and SV increase by about 2x+.
3. Some people may look at the price of cryptos and scoff. How could anyone pay thousands of dollars for a Bitcoin? Well, this report holds your answer. For a Bitcoin people are currently paying less than 2x what it costs a major mining business to mine a coin and for other coins like Bitcoin Cash miners are actually losing money. If the cost to mine a coin is a book value of sorts, then (scarcity and all other factors aside) one can see why its thousands of dollars to buy a Bitcoin in this day and age and not just a few dollars. What are the profit margins in other industries? Doesn’t this inform to some extent costs?

See the links and the tweets below for graphics and charts.

Although the ABC SV split is entertaining, we estimate that SV miners are burning US$280,000 per day mining the SV chain.

Assumptions:
* S9 miners
* Able to sell SV coins at the current spot price ($100)
* 5 cent per kWhhttps://t.co/U9hbK4peip pic.twitter.com/ULjwWSI0GA

— BitMEX Research (@BitMEXResearch) November 16, 2018

Bitcoin Cash ABC miners are also making considerable daily losses, even larger losses than SV miners, according to our estimates. pic.twitter.com/uMS9LiYUXS

— BitMEX Research (@BitMEXResearch) November 16, 2018