Bitcoin Mining Unprofitable in U.S. as Costs Exceed Price

Data from the Cambridge Bitcoin Electricity Consumption Index (CBECI) reveals a stark reality for miners in the United States. With Bitcoin trading around $87,900, the average cost to mine a single coin in the U.S. stands at $94,746, based on an average nationwide energy cost of $0.14 per kWh. Even when using the lower average industrial energy rate of $0.09 per kWh, the cost remains perilously close to the market price at $86,931. This razor-thin margin, set against a backdrop of geopolitical and macroeconomic uncertainty, leaves American miners highly vulnerable to any downward price movement.

The profitability crisis is not confined to the U.S. In China, where the average business energy rate hit $0.11 per kWh in June 2025, the cost to mine one Bitcoin averages $88,869. Russia faces a similar rate and cost structure, while Canada’s slightly lower $0.10 per kWh rate translates to a mining cost of $88,003. The situation is even more extreme in countries like New Zealand, where trade body Cryptocurrency NZ calculates the cost at over $103,000 per Bitcoin, making large-scale operations commercially unviable.

This global squeeze underscores a fundamental truth articulated by Digiconomist founder Alex de Vries. “You can do the math yourself considering it takes about 1.2 million kWh to mine one Bitcoin at the moment,” he told Decrypt. “At a price of $85k per coin, anything above just 7 cents per kWh in costs will put you at a loss.” De Vries concluded that unprofitability will “actually be very common in most places,” as securing the ultra-low rates needed for profitability is exceptionally difficult.

Amid widespread strain, a few regions stand out as relative havens. Paraguay, which now accounts for approximately 4% of Bitcoin’s global hashrate, benefits from an average business electricity price of just $0.05 per kWh. This allows for an average mining cost of about $59,650 per Bitcoin, providing a significant competitive buffer against current market prices. This disparity highlights how geographic arbitrage on energy costs has become a primary determinant of mining survival.

Facing unprofitability, many established miners are not waiting for a price rescue. In the past year and a half, at least nine American mining companies—including Riot Platforms, Bitfarms, Core Scientific, IREN, TeraWulf, CleanSpark, Bit Digital, MARA Holdings, and Cipher Mining—have pivoted either wholly or in part to becoming AI data centers. This strategic shift represents a fundamental diversification away from pure-play cryptocurrency mining, leveraging their existing infrastructure and expertise in high-power computing for a more stable revenue stream.

Other firms are doubling down on operational discipline within the mining sector. Leo Wang, VP of Capital Markets and Corporate Development at Canaan, explained his company’s risk-mitigation strategy. “We try to keep our power price below 4 cents/kWh, which has historically been sustainable through bear markets,” Wang said. Canaan also avoids excessive debt, designs and sells its own mining hardware to generate cash flow, and maintains flexible hosting agreements that allow it to reduce or close operations where economics turn negative.

The immediate pressure from high energy costs and stagnant prices is compounded by a known future event: the next Bitcoin reward halving, expected in approximately two years. This programmed reduction in block rewards will cut the number of new Bitcoins issued to miners by half, directly slashing a major component of their revenue unless the price of Bitcoin rises substantially to compensate.

Experts warn that this event could be a breaking point for many operations. “That’s still quite some time,” Alex de Vries noted, “but without substantial increases in the price level by then the miners would get squeezed even further.” The halving will effectively double the break-even cost of production for miners, making today’s challenging economics look favorable by comparison if prices remain flat.

In response, companies like Canaan are looking beyond simple cost-cutting. Wang highlighted a longer-term strategy: “From lower-cost markets to off-grid energy operations in Canada, our global footprint and technical capabilities also allow us to explore new energy sources and energy reuse, which reduces our reliance on any single grid or power source over time.” This approach points to an industry future where resilience is built not just on cheap power, but on diversified, flexible, and innovative energy sourcing. For now, the survival of many Bitcoin miners hinges on a delicate and urgent equation: securing ultra-low-cost energy, diversifying business models, and hoping for a significant and sustained rise in the price of Bitcoin before the next halving applies even greater pressure.