How Does Depreciation of Mining Hardware Impact the Long-Term Break-Even Analysis?

Depreciation, the reduction in the value of the hardware over time, is a non-cash expense that must be accounted for. It is crucial for long-term break-even analysis because it reflects the cost of replacing the equipment.

Proper accounting for depreciation ensures that the miner is setting aside enough capital to purchase the next generation of hardware, maintaining the viability of the operation.