Bitcoin's production cost has plunged as analysts improve efficiency, price may follow.
The drop in production costs could mean a further reduction in the price of bitcoin.
The investment bank estimated bitcoin’s average production cost was $20,000 at the beginning of June, dropping this to $15,000 by the end of the month and $13,000 as of Wednesday. Analysts have attributed the drop to the decline in electricity use. In order to estimate a quantifiable production cost for bitcoin JPMorgan treats it as a commodity and bases it on the marginal cost of production. The marginal cost of production is estimated using daily price data, hash rate and difficulty from bitinfocharts.com, the bank said in a note on June 24.
The report added that the decline in production cost could be perceived as negative for bitcoin's price. During a bear market, the production cost is perceived by some market participants as the lower bound of the price range.
France Dernières Nouvelles, France Actualités
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