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Originally published: 16/04/2021 08:23
Last version published: 19/06/2021 14:34
Publication number: ELQ-52787-4
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Bitcoin Farm Model - Excel Template

Financial model of a BTC (Bitcoin) cryptocurrency mining farm in Microsoft Excel.

by Alex Martyanov
Professional Private Practice - Financial ModelingFollow 60

1 review705 views|6 comments|Bookmark Add to cart - $99.00

btcminingasiccryptocurrencycryptobitcoinfarming

Description
This model allows to model a BTC mining farm.
It accounts for the following factors:
- BTC current price and price predictions
- BTC mining difficulty and its growth
- Mining pool fees
- Electricity prices
- ASICs prices
- Other capital expenditures
- Stuff salaries
- Rent expenses
- Provision for any ASIC (hash rate, electricity consumption, degradation rate)

The model allows to asses the mining project:
- required capital expenditures
- farm revenue in BTC and $
- operational expenditures (electricity, rent, salaries)
- net cash flow
- payback period
- internal rate of return

Info about bitcoin mining:
Bitcoin mining is the process by which new bitcoins are entered into circulation, but it is also a critical component of the maintenance and development of the blockchain ledger. It is performed using very sophisticated computers that solve extremely complex computational math problems.

Cryptocurrency mining is painstaking, costly, and only sporadically rewarding. Nonetheless, mining has a magnetic appeal for many investors interested in cryptocurrency because of the fact that miners are rewarded for their work with crypto tokens. This may be because entrepreneurial types see mining as pennies from heaven, like California gold prospectors in 1849. And if you are technologically inclined, why not do it?

However, before you invest the time and equipment, read this explainer to see whether mining is really for you. We will focus primarily on Bitcoin (throughout, we'll use "Bitcoin" when referring to the network or the cryptocurrency as a concept, and "bitcoin" when we're referring to a quantity of individual tokens).

This Best Practice includes
1 Excel File

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• Kevin O'DC(last updated: 27/05/2021 06:03)
  

  Practical and Easy to understand

  Practical and Easy to understand

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  Kevin O'DC 1 month ago
  User

  Hi there,
  
  I hope this message finds you in the best of health.
  
  In the Electrical Consumption box on sheet "Mining Farm" the following equation is set "=3250*24/1000".
  
  What did you choose to divide the power consumption by 1000?

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  • 

    Alex Martyanov 1 month ago
    Authorstar

    Hi Kevin,
    
    Thanks for using my model.
    Total monthly electrical consumption of one ASICs in kWh may be calculated by:
    [ Electricity consumption in W ] * [ Number of hours in month (24 * 30) ] / 1000 (transforming Wh to kWh)
    I've made these steps more straightforward in the updated version of the model. It should be available very soon after review by the site administration.

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    • 

      Kevin O'DC 1 month ago
      User

      Hi Alex,
      
      Thank you for the updated version.
      
      The model assume the flat price prediction of 57k. What do you think of Bitcoins Stock to flow model as a future price predictor? https://stats.buybitcoinworldwide.com/stock-to-flow/
      
      Is the 5% degradation for the Antminer S19 PRO arbitrary, or does this data come from a specific source (Same for other ASICS on the list).

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      • 

        Alex Martyanov 1 month ago
        Authorstar

        Hi Kevin,
        I believe the current bitcoin price is mostly affected by its degree of acceptance (through PayPal, Visa) and its regulations (tightening by China government). Both factors are hard to model as we need to predict the amount of BTC-related payments in the first case, which is complicated, range of predictions will be too broad. Future government decisions (in a few main countries) could vary to a high extent too. So with the two unknowns, it is a tricky task to guess the right price.
        Bitcoins Stock to Flow model could be useful in the long run, when the BTC supply/demand are balanced. Currently, they are not balanced, and a change in acceptance/regulations could dramatically change the balance.
        I've not seen any trustworthy S19 PRO degradation rate info. The 5% for S19 PRO is an arbitrary rate.

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• 

  Raul Terroba 2 months ago
  User

  Hey is there any way to have this made in Sheets format. I downloaded it and my chromebook can only open sheets & some of the formulas will stop working....

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  • 

    Alex Martyanov 1 month ago
    Authorstar

    Hi Raul,
    
    I can save and send the model to you in any format supported by MS Excel.
    https://support.microsoft.com/en-us/office/save-a-workbook-in-another-file-format-6a16c862-4a36-48f9-a300-c2ca0065286e
    Please let me know which file extension works best for you.

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