A Short History: How Bitcoin Reached Parity With Gold
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Chart: How Bitcoin Reached Parity With Gold

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Chart: How Bitcoin Reached Parity With Gold

Chart: How Bitcoin Reached Parity With Gold

Charting the fast and volatile rise of bitcoin

The Chart of the Week is a weekly Visual Capitalist feature on Fridays.

Would you rather have one bitcoin, or a single ounce of gold?

The answer used to be obvious. Even at the climax of the legendary 2013 rally, bitcoin was never able to reach unit-for-unit parity with gold.

However, since an off-year in 2014, the enigmatic cryptocurrency has steadily climbed in price to take the title of the best-performing currency in both 2015 and 2016. And today? After continuing its rally into 2017, the price of bitcoin has now passed this arbitrary, but psychologically important measure of parity with an ounce of gold.

How did we get here so fast?

Bitcoin: A Short History

Here are some of the most important events that have shaped the bitcoin market:

May 2010: The famous “Bitcoin Pizza” transaction takes place.
This is one of the first “real world” transactions, in which one man indirectly paid 10,000 BTC for two Papa John’s pizzas. That works out to a pretty steep price of over $6 million per pizza using today’s prices, but we are sure they were delicious. Today, May 22 is still celebrated as “Bitcoin Pizza Day” throughout the Bitcoin community.

February 2011: Bitcoin hits “dollar parity”.

October 2012: Bitpay says 1,000 merchants accept bitcoin payments.
Early adopters of the cryptocurrency included WordPress.com, Reddit, OKCupid, and The Pirate Bay.

Mar 2013: Cyprus bank bail-in.
Generally speaking, the European Debt Crisis was a major boon for bitcoin. However, this specific event really put the potential downsides of the banking system and centralized fiat currencies in the limelight.

Oct 2013: Silk Road Bust
As prices were soaring at the end of 2013, the FBI seized 26,000 BTC from Silk Road and its alleged owner, Ross Ulbricht.

Feb 2014: Mt. Gox files for bankruptcy protection
The world’s biggest exchange, which at one point controlled 70% of bitcoin transactions, was plagued with hacks and other problems. It finally went under in 2014.

Aug 2015: By this point, 160,000 merchants accept bitcoin payments

Dec 2016: Bitcoin is the world’s top performing currency for 2nd straight year
See our charts on this for 2015 and 2016.

Bitcoin’s Rise in Context

For enthusiasts and speculators that have followed the cryptocurrency since the beginning, the meteoric rise of bitcoin has been a wild ride.

However, despite the feat of reaching unit-for-unit parity with gold, it is important to take in some context.

Firstly, there are about 16.2 million BTC in circulation – and there are 5.6 billion oz of gold that have been mined throughout history. For that reason the value of the gold market is still more than 300x higher.

Next, while the value of the bitcoin market has soared exponentially since the early days, it is still only worth about $20 billion in total – this is about half of the value of the average company on the S&P 500 (~$40 billion). Compare the bitcoin market to an Apple or Google, and it seems even less extraordinary.

But for those people that follow the crypto markets closely, this above context actually represents the potential upside of the digital cryptocurrency. It means bitcoin still has lots of room to soar – and since bitcoin supply is limited and cannot be created out of thin air, there is nowhere for the price to go but up.

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Technology

The Cost of Mining Bitcoin in 198 Different Countries

Mining bitcoin is costly. But the exact price fluctuates, depending on the location and the cost of electricity in the area.

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Cost of Mining Bitcoin in 198 Different Countries

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It takes an estimated 1,449 kilowatt hours (kWh) of energy to mine a single bitcoin. That’s the same amount of energy an average U.S. household consumes in approximately 13 years.

Given the high amount of energy needed to mine bitcoin, it can be a costly venture to get into. But exact prices fluctuate, depending on the location and the cost of electricity in the area.

Where are the cheapest and most expensive places to mine this popular cryptocurrency? This graphic by 911 Metallurgist provides a snapshot of the estimated cost of mining bitcoin around the world, using pricing and relative costs from March 23, 2022.

How Does Bitcoin Mining Work?

Before diving in, it’s worth briefly explaining the basics of bitcoin mining, and why it requires so much energy.

When someone mines for bitcoin, what they’re really doing is adding and verifying a new transaction record to the blockchain—the decentralized bank ledger where bitcoin is traded and distributed.

To create this new record, crypto miners need to crack a complex equation that’s been generated by the blockchain system.

Potentially tens of thousands of miners are racing to crack the same code at any given time. Only the first person to solve the equation gets rewarded (unless you’re part of a mining pool, which is essentially a group of miners who agree to combine efforts to increase their chances of solving the equation).

The faster your computing power is, the better your chances are of winning, so solving the equation first requires powerful equipment that takes up a lot of energy.

The Costs and Profits of Mining Bitcoin in 198 Countries

Across the 198 countries included in the dataset, the average cost to mine bitcoin sat at $35,404.03, more than bitcoin’s value of $20,863.69 on July 15, 2022. Though it’s important to note that fluctuating energy prices, and more or less miners on the bitcoin network, constantly change the necessary energy and final cost.

Here’s a breakdown of what the cost to mine one bitcoin in each country was in March 23, 2022, along with the potential profit after accounting for mining costs:

#CountryCost to mine 1 bitcoinProfit (July 15, 2022)
1🇰🇼 Kuwait$1,393.95$18,362.58
2🇩🇿 Algeria$4,181.86$15,574.67
3🇸🇩 Sudan$4,779.27$14,977.26
4🇾🇪 Yemen$7,161.77$12,594.76
5🇪🇹 Ethiopia$7,168.91$12,587.62
6🇰🇬 Kyrgyzstan$7,168.91$12,587.62
7🇦🇴 Angola$7,368.04$12,388.49
8🇶🇦 Qatar$7,368.04$12,388.49
9🇰🇵 North Korea$7,744.32$12,012.21
10🇰🇿 Kazakhstan$8,762.00$10,994.53
11🇿🇲 Zambia$9,160.27$10,596.26
12🇦🇿 Azerbaijan$9,558.54$10,197.99
13🇧🇳 Brunei$9,956.81$9,799.72
14🇮🇷 Iran$10,355.09$9,401.44
15🇺🇿 Uzbekistan$10,355.09$9,401.44
16🇽🇰 Kosovo$10,560.17$9,196.36
17🇸🇬 Singapore$10,952.50$8,804.03
18🇲🇳 Mongolia$11,151.63$8,604.90
19🇧🇹 Bhutan$11,749.04$8,007.49
20🇧🇭 Bahrain$11,948.18$7,808.35
21🇴🇲 Oman$11,948.18$7,808.35
22🇹🇯 Tajikistan$12,545.59$7,210.94
23🇺🇦 Ukraine$12,744.72$7,011.81
24🇬🇪 Georgia$13,143.00$6,613.53
25🇦🇬 Paraguay$13,143.00$6,613.53
26🇹🇹 Trinidad and Tobago$13,143.00$6,613.53
27🇸🇷 Suriname$14,337.81$5,418.72
28🇸🇦 Saudi Arabia$14,736.09$5,020.44
29🇦🇲 Armenia$15,333.50$4,423.03
30🇹🇳 Tunisia$15,333.50$4,423.03
31🇸🇾 Syria$15,532.63$4,223.90
32🇨🇬 Congo (Republic Of The)$16,130.04$3,626.49
33🇲🇲 Myanmar$16,130.04$3,626.49
34🇷🇺 Russia$16,130.04$3,626.49
35🇮🇶 Iraq$16,926.59$2,829.94
36🇲🇩 Moldova$16,926.59$2,829.94
37🇹🇷 Turkey$17,723.13$2,033.40
38🇷🇴 Romania$18,320.54$1,435.99
39🇦🇱 Albania$18,718.81$1,037.72
40🇧🇩 Bangladesh$18,718.81$1,037.72
41🇱🇮 Liechtenstein$18,917.95$838.58
42🇱🇹 Lithuania$18,917.95$838.58
43🇲🇿 Mozambique$19,117.08$639.45
44🇪🇬 Egypt$19,316.22$440.31
45🇨🇩 Congo (Democratic Republic Of The)$19,913.63-$157.10
46🇳🇴 Norway$20,112.77-$356.24
47🇦🇹 Austria$20,311.90-$555.37
48🇨🇱 Chile$20,311.90-$555.37
49🇪🇪 Estonia$20,511.04-$754.51
50🇸🇪 Sweden$20,710.18-$953.65
51🇨🇫 Central African Republic$20,909.31-$1,152.78
52🇺🇸 United States$21,088.53-$1,332.00
53🇧🇬 Bulgaria$21,307.58-$1,551.05
54🇮🇩 Indonesia$21,307.58-$1,551.05
55🇷🇸 Serbia$21,307.58-$1,551.05
56🇦🇷 Argentina$21,506.72-$1,750.19
57🇦🇪 United Arab Emirates$21,705.86-$1,949.33
58🇳🇬 Nigeria$22,303.27-$2,546.74
59🇲🇬 Madagascar$22,502.40-$2,745.87
60🇱🇻 Latvia$22,701.54-$2,945.01
61🇰🇷 South Korea$22,701.54-$2,945.01
62🇧🇦 Bosnia and Herzegovina$23,099.81-$3,343.28
63🇹🇼 Taiwan$23,298.95-$3,542.42
64🇮🇱 Israel$23,498.08-$3,741.55
65🇪🇨 Ecuador$23,697.22-$3,940.69
66🇲🇾 Malaysia$23,896.36-$4,139.83
67🇳🇵 Nepal$23,896.36-$4,139.83
68🇳🇿 New Zealand$23,896.36-$4,139.83
69🇱🇺 Luxembourg$24,095.49-$4,338.96
70🇮🇸 Iceland$24,294.63-$4,538.10
71🇨🇦 Canada$24,493.76-$4,737.23
72🇲🇦 Morocco$24,692.90-$4,936.37
73🇿🇼 Zimbabwe$24,692.90-$4,936.37
74🇻🇳 Vietnam$24,892.04-$5,135.51
75🇨🇮 Côte D’Ivoire (Ivory Coast)$25,091.17-$5,334.64
76🇱🇾 Libya$25,091.17-$5,334.64
77🇹🇿 Tanzania$25,091.17-$5,334.64
78🇦🇩 Andorra$25,276.27-$5,519.74
79🇨🇳 China$25,489.45-$5,732.92
80🇱🇧 Lebanon$25,887.72-$6,131.19
81🇱🇦 Laos$26,285.99-$6,529.46
82🇫🇮 Finland$26,485.13-$6,728.60
83🇫🇷 France$27,082.54-$7,326.01
84🇨🇭 Switzerland$27,082.54-$7,326.01
85🇵🇱 Poland$27,281.67-$7,525.14
86🇷🇼 Rwanda$27,281.67-$7,525.14
87🇹🇭 Thailand$27,281.67-$7,525.14
88🇨🇿 Czech Republic$27,480.81-$7,724.28
89🇱🇸 Lesotho$27,679.95-$7,923.42
90🇲🇪 Montenegro$28,078.22-$8,321.69
91🇲🇱 Mali$28,277.35-$8,520.82
92🇨🇷 Costa Rica$28,675.63-$8,919.10
93🇳🇱 Netherlands$28,675.63-$8,919.10
94🇧🇾 Belarus$29,273.04-$9,516.51
95🇳🇦 Namibia$30,069.58-$10,313.05
96🇲🇰 Macedonia, North$30,866.13-$11,109.60
97🇸🇲 San Marino$30,866.13-$11,109.60
98🇸🇰 Slovakia$31,065.26-$11,308.73
99🇿🇦 South Africa$32,060.94-$12,304.41
100🇧🇼 Botswana$32,459.22-$12,702.69
101🇸🇿 Swaziland$32,857.49-$13,100.96
102🇧🇪 Belgium$33,255.76-$13,499.23
103🇺🇾 Uruguay$33,255.76-$13,499.23
104🇧🇷 Brazil$33,454.90-$13,698.37
105🇭🇷 Croatia$33,454.90-$13,698.37
106🇮🇹 Italy$33,454.90-$13,698.37
107🇺🇬 Uganda$33,654.03-$13,897.50
108🇨🇲 Cameroon$33,853.17-$14,096.64
109🇲🇽 Mexico$33,853.17-$14,096.64
110🇲🇼 Malawi$34,251.44-$14,494.91
111🇧🇮 Burundi$34,450.58-$14,694.05
112🇱🇰 Sri Lanka$34,450.58-$14,694.05
113🇬🇶 Equatorial Guinea$34,649.72-$14,893.19
114🇧🇴 Bolivia$34,848.85-$15,092.32
115🇲🇷 Mauritania$35,047.99-$15,291.46
116🇵🇸 Palestine$35,047.99-$15,291.46
117🇹🇬 Togo$35,047.99-$15,291.46
118🇦🇫 Afghanistan$35,844.53-$16,088.00
119🇭🇺 Hungary$35,844.53-$16,088.00
120🇸🇱 Sierra Leone$35,844.53-$16,088.00
121🇲🇨 Monaco$35,922.73-$16,166.20
122🇵🇭 Philippines$36,043.67-$16,287.14
123🇰🇭 Cambodia$36,242.81-$16,486.28
124🇸🇳 Senegal$36,242.81-$16,486.28
125🇸🇹 São Tomé and Príncipe$36,441.94-$16,685.41
126🇮🇪 Ireland (Republic Of)$37,835.90-$18,079.37
127🇲🇹 Malta$37,835.90-$18,079.37
128🇨🇾 Cyprus$38,035.03-$18,278.50
129🇬🇦 Gabon$38,035.03-$18,278.50
130🇸🇻 El Salvador$38,831.58-$19,075.05
131🇵🇪 Peru$38,831.58-$19,075.05
132🇨🇴 Colombia$39,628.12-$19,871.59
133🇩🇴 Dominican Republic$40,026.40-$20,269.87
134🇬🇹 Guatemala$40,026.40-$20,269.87
135🇬🇲 The Gambia$40,225.53-$20,469.00
136🇬🇳 Guinea$40,424.67-$20,668.14
137🇮🇳 India$40,424.67-$20,668.14
138🇦🇺 Australia$40,623.81-$20,867.28
139🇬🇷 Greece$40,623.81-$20,867.28
140🇲🇺 Mauritius$40,822.94-$21,066.41
141🇧🇯 Benin$41,221.21-$21,464.68
142🇭🇳 Honduras$41,420.35-$21,663.82
143🇭🇹 Haiti$42,017.76-$22,261.23
144🇹🇩 Chad$42,216.90-$22,460.37
145🇳🇪 Niger$42,416.03-$22,659.50
146🇰🇪 Kenya$43,212.58-$23,456.05
147🇫🇯 Fiji$43,411.71-$23,655.18
148🇪🇷 Eritrea$43,610.85-$23,854.32
149🇸🇸 South Sudan$43,809.99-$24,053.46
150🇵🇰 Pakistan$44,208.26-$24,451.73
151🇵🇹 Portugal$44,208.26-$24,451.73
152🇧🇿 Belize$45,004.80-$25,248.27
153🇳🇷 Nauru$45,378.54-$25,622.01
154🇹🇱 Timor-Leste$46,597.89-$26,841.36
155🇬🇭 Ghana$46,996.17-$27,239.64
156🇯🇵 Japan$47,195.30-$27,438.77
157🇧🇫 Burkina Faso$47,394.44-$27,637.91
158🇩🇰 Denmark$48,190.98-$28,434.45
159🇯🇴 Jordan$48,987.53-$29,231.00
160🏴󠁧󠁢󠁥󠁮󠁧󠁿 England$49,301.82-$29,545.29
161🏴󠁧󠁢󠁳󠁣󠁴󠁿 Scotland$50,090.64-$30,334.11
162🇵🇦 Panama$50,580.62-$30,824.09
163🇩🇪 Germany$50,978.89-$31,222.36
164🇬🇧 Ireland (Northern)$51,536.83-$31,780.30
165🇪🇸 Spain$51,775.44-$32,018.91
166🇩🇯 Djibouti$52,173.71-$32,417.18
167🏴󠁧󠁢󠁷󠁬󠁳󠁿 Wales$52,194.19-$32,437.66
168🇨🇻 Cape Verde$52,372.85-$32,616.32
169🇯🇲 Jamaica$52,571.98-$32,815.45
170🇧🇧 Barbados$52,970.26-$33,213.73
171🇸🇮 Slovenia$52,970.26-$33,213.73
172🇹🇻 Tuvalu$53,887.02-$34,130.49
173🇬🇼 Guinea-Bissau$54,364.21-$34,607.68
174🇰🇲 Comoros$55,957.30-$36,200.77
175🇧🇸 Bahamas$56,753.85-$36,997.32
176🇵🇬 Papua New Guinea$57,550.39-$37,793.86
177🇰🇳 Saint Kitts and Nevis$60,935.71-$41,179.18
178🇬🇩 Grenada$61,533.12-$41,776.59
179🇵🇼 Palau$63,922.75-$44,166.22
180🇱🇨 Saint Lucia$63,922.75-$44,166.22
181🇸🇨 Seychelles$63,922.75-$44,166.22
182🇬🇾 Guyana$65,316.71-$45,560.18
183🇳🇮 Nicaragua$66,511.52-$46,754.99
184🇻🇨 Saint Vincent and Grenadines$68,901.16-$49,144.63
185🇹🇴 Tonga$72,087.34-$52,330.81
186🇩🇲 Dominica$73,282.16-$53,525.63
187​🇻🇺​ Vanuatu$76,070.07-$56,313.54
188🇼🇸​ Samoa$76,667.48-$56,910.95
189​🇨🇺​ Cuba$76,946.27-$57,189.74
190🇱🇷 Liberia$77,663.16-$57,906.63
191​🇲🇻​ Maldives$78,459.70-$58,703.17
192🇲🇭 Marshall Islands$80,849.34-$61,092.81
193🇸🇴 Somalia$82,044.16-$62,287.63
194🇰🇮 Kiribati$82,243.29-$62,486.76
195🇫🇲 Micronesia, Federated States Of$82,442.43-$62,685.90
196🇦🇬 Antigua and Barbuda$89,412.20-$69,655.67
197🇸🇧 Solomon Islands$142,581.59-$122,825.06
198🇻🇪 Venezuela$246,530.74-$226,774.21

Venezuela ranks as the number one most expensive country to mine bitcoin. It costs a whooping $246,530.74 to mine a single bitcoin in the South American country, meaning the process is far from profitable. Energy costs are so expensive in the country that miners would be out $225,667.05 for just one bitcoin.

On the opposite end of the spectrum, the cheapest place to mine bitcoin is in Kuwait. It costs $1,393.95 to mine a single bitcoin in Kuwait, meaning miners could gain $19,469.74 in profits.

The Middle Eastern country has some of the cheapest electricity in the world, with one kWh costing an average of just 3 cents. For context, the average cost of one kWh in North America is 21 cents.

The Race is On

Despite the steep costs of bitcoin mining, many people believe it’s worth the upfront investment.

One thing that makes bitcoin particularly appealing is its finite supply—there are only 21 million coins available for mining, and as of this article’s publication, more than 19 million bitcoin have already been mined.

While the price of bitcoin (BTC) is notorious for its volatility, its value has still grown significantly over the last decade. And if cryptocurrencies become mainstream as many people believe they will, this could boost the price of bitcoin even further.

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