How Does the ‘Cost of Production’ Relate to the Minimum Sustainable Price for a Miner?

The cost of production includes all expenses: electricity, hardware depreciation, overhead, and pool fees. This total cost, divided by the number of coins mined, gives the average cost per coin.

This figure represents the minimum price at which a miner can sell their coins and break even. If the market price falls consistently below this cost, the mining operation becomes unsustainable in the long term, forcing the miner to shut down.