When we look at the hashprice range over the last 12 months, we see that any miner wanting to maintain at least 50% gross margin needs to be paying less than $0.03 per kWh. Based upon financial reports, the average for public miners is around $0.045/kWh meaning that they have been wandering in the sub 50% gross margin range for most of the last year. While they aren’t having to turn off, it does put a squeeze on their overall profitability.

The opposite is true for a revenue share based energy agreement. Even an older, less efficient machine like the M30s is still pumping out profitable kWh’s at record low hashprices. In fact, the dirt-cheap M30s on a revenue share model at $40/PH beats almost everything on the fixed energy model at $50/PH. What also becomes apparent in the revenue share model is that the last generation mid-tier machines like the M30s++ are some of the best bang for the buck even with lower hashprices. They are cheap and reasonably efficient and therefore a perfect fit for rev-share mining.

The one downside to revenue share energy contracts is that you do end up giving up some of the upside when hashprice decides to take a trip into the stratosphere. This is somewhat visible in the charts but better illustrated by the fact that on a 30% revenue share at a $70 hashprice, we would actually pay more for electricity than the $0.045 average of the pubco miners. If we ever make it back to $100/PH then we would be paying nearly $0.07/kWh. This higher cost of energy is offset by the fact that we are still making great money on our operation but it does dampen the idea of massive profit reaping during the next hashprice bull run.