Public miner audit · Oct 12, 2026 · 5 min read
Canaan in the first half of 2026: 4.3¢ per kWh all-in, and $61,900 per bitcoin
Canaan, the maker of Avalon machines, mined 500 BTC in the first half of 2026 at a stated all-in power cost of about 4.3¢ per kWh. Each bitcoin still cost $61,900 to make, because its power line also carries its hosting partners' share of what the machines earn.
TL;DR
- 500 BTC mined in the first half: 257 in the first quarter, 243 in the second.
- 4.3¢ per kWh all-in, which is Canaan's own stated rate. It assumes every installed machine is running.
- $61,900 per bitcoin at that rate, against $73,600 of revenue for each bitcoin mined.
- The gap between a moderate rate and a high cost per bitcoin comes from joint-mining deals: hosting partners are paid a share of the output, and that share sits in the power line.
- Mining is a minority of the business: 39% of first-half revenue, so overheads are allocated by that share.
What they reported
Canaan Inc. is a foreign private issuer listed in the US. It files quarterly results as 6-K exhibits, an annual report on Form 20-F, and a bitcoin production update every month. This piece reads the first-quarter results, the second-quarter results, the half-year financial statements, the 2025 20-F and the monthly updates from December 2025 to June 2026.
Canaan designs ASIC chips and sells Avalon mining machines; self-mining is the smaller of its two businesses. Mining brought in $36.8 million of its $94.6 million revenue in the first half. It reports one operating segment, so mining appears only as two lines in the income statement: "Mining revenue" and "Mining cost".
At the end of June it had 10.05 EH/s installed outside its joint venture, at an average 23.7 J/TH (17.9 J/TH in North America, 29.3 J/TH elsewhere), across sites in North America, Ethiopia, Canada, the Middle East and Malaysia. Month-end operating hashrate was 6.89 EH/s in March, 6.47 EH/s in May and 3.36 EH/s in June, when an Ethiopian site was taken offline for grid maintenance. In February it bought a 49% stake in three West Texas sites (the ABC Projects, about 4.4 to 4.85 EH/s). That stake is accounted for by the equity method, and its bitcoin is left out of everything below.
The power bill
Canaan does not split electricity from hosting. Its mining cost is "direct production costs of mining operations, including electricity and hosting, as well as depreciation of deployed mining machines". Taking out the depreciation it states each quarter leaves $16.9 million in the first quarter and $14.1 million in the second, $31.0 million for the half. No curtailment or demand-response credits are disclosed.
Canaan reports no MWh. It does state an all-in power cost: "approximately US$0.04/kWh" for the first quarter, and about US$0.043 per kWh for the second, with monthly figures of 4.3¢ to 4.4¢. Dividing the cost by those rates gives 386,500 MWh in the first quarter and 327,600 MWh in the second, 714,100 MWh for the half. So our 4.4¢ (first quarter), 4.3¢ (second) and 4.3¢ (half) agree with Canaan's by construction: the energy figure comes from its rate.
One limit matters. The monthly updates define that rate as "the weighted average cost of power if 100% of the mining machines consisting of Installed Computing Power were energized". It is a rate for a fleet at full uptime, and Canaan's fleet ran well below full uptime in both quarters.
Everything else it takes to run the sites
Canaan reports no other direct mining cost apart from depreciation. Site operations, hosting fees and power all sit in the one direct-cost figure, so the all-in rate equals the power rate: 4.3¢ for the half.
Sales and marketing plus general and administrative expenses came to $33.2 million in the half. Research and development, about $15 million a quarter, mostly serves the machine business and is left out. We allocate overheads to mining by its share of revenue: 31% in the first quarter and 55% in the second, as machine sales fell. Without stock-based pay, that adds $11.1 million and takes the loaded rate to 5.9¢ per kWh. The $3.3 million of stock-based pay allocated to mining is shown separately.
What a bitcoin cost them
At 4.3¢, $61,900 per bitcoin looks high. Two things explain it.
The first is how Canaan mines. Most of its sites run under "joint mining arrangements": a partner provides the site and the power, and is paid a share of what the machines earn. The monthly updates give Canaan's share as 58% to 61% of revenue, assuming all machines are running. Canaan books the whole output as its revenue and the partners' share as cost, inside "electricity and hosting". The December update shows the scale: of 1,091 BTC mined in 2025, 776 BTC were "deployed for power-related expenditures". Where a partner takes a share of revenue, the cost follows what the machines earn rather than the kWh they draw. In the first half that cost came to 84% of revenue per bitcoin.
The second is the fleet. At 23.7 J/TH on average, each bitcoin took about 1,430 MWh in the half. A newer fleet would make the same bitcoin on fewer kWh.
Adding the allocated overheads gives $84,000 per bitcoin, and $90,700 with stock-based pay.
4.3¢ per kWh, and $61,900 per bitcoin: the hosting partners' share is in the power line.
| Period | Bitcoin mined | Power ¢/kWh | All-in ¢/kWh | Loaded ¢/kWh | Power $/BTC | All-in $/BTC | Loaded $/BTC | Revenue $/BTC |
|---|---|---|---|---|---|---|---|---|
| Q1 2026 | 257 | 4.4¢ | 4.4¢ | 5.3¢ | $65,700 | $65,700 | $80,300 | $74,400 |
| Q2 2026 | 243 | 4.3¢ | 4.3¢ | 6.5¢ | $58,000 | $58,000 | $88,000 | $72,700 |
| H1 2026 | 500 | 4.3¢ | 4.3¢ | 5.9¢ | $61,900 | $61,900 | $84,000 | $73,600 |
The hardware
Depreciation of mining machines was $5.8 million in the first quarter and $6.3 million in the second. From 2026 Canaan depreciates machines over two years instead of one and a half, which cut depreciation by $7.4 million in the half. In the second quarter it took a $9.2 million impairment on property and equipment, which it put down to lower bitcoin prices.
Capex for mining is not disclosed by quarter. The half-year cash-flow statement shows $5.6 million of company-wide spending on property, equipment and software, plus $3.1 million of machines moved from Canaan's own inventory into its fleet. The 6,840 Avalon A15Pro machines bought from Cipher in February were paid for in shares, together with the joint-venture stake.
None of this is in the cost per bitcoin above. A machine is the roof over a mining operation: it is bought once and replaced out of what it earns, and folding its price into each bitcoin would make the figure comparable to nothing. It is shown here in full so that nothing is hidden.
| Period | Mining depreciation | Impairments | Mining capex |
|---|---|---|---|
| Q1 2026 | $5.8m | $0 | Not disclosed |
| Q2 2026 | $6.3m | $9.2m | Not disclosed |
| H1 2026 | $12.1m | $9.2m | $5.6m company-wide (cash), plus $3.1m of machines from inventory |
What it means
Hosting at Firsthand's sites runs from 3.9¢ to 6.5¢ per kWh all-in, on our sites page. Canaan's stated all-in rate for the half, 4.3¢ at full uptime, sits inside that range. It mined 500 BTC in the half, and the cost of each one was set as much by the share its hosting partners take, and by the efficiency of its fleet, as by the rate per kWh.
Mining output depends on bitcoin's price, difficulty and uptime, and isn't guaranteed.
This is our analysis of the company's public filings, not an audit in the accounting sense.
Method and sources
Bitcoin mined is Canaan's quarterly figure (the monthly updates add up to 258 and 244, a rounding difference). Mining revenue and mining cost are from the income statements. Power is mining cost minus the mining depreciation stated in each release, rounded there to $0.1 million. It includes hosting and partners' revenue share, which cannot be separated.
Energy is derived. We divided the power cost by Canaan's own all-in power cost: the average of its monthly figures (4.3¢, 4.4¢, 4.4¢) for the first quarter and its stated 4.3¢ for the second. Using the first quarter's rounded "approximately US$0.04/kWh" instead would give more MWh and a lower rate. Because the rate assumes every installed machine is running, the cost per kWh actually drawn could be higher than the rate shown.
Overheads are sales and marketing plus general and administrative expenses, less the stock-based pay recorded in them, multiplied by mining's share of revenue each quarter. The 49% stake in the ABC Projects is equity-accounted: its output (about 45 to 48 BTC a month per the April and May updates), costs and power are excluded.
Sources and further reading
- Fourth quarter and full year 2025 results (6-K) — Canaan Inc., 2026-02-10
- Annual report 2025 (Form 20-F) — Canaan Inc., 2026-04-15
- First quarter 2026 results (6-K) — Canaan Inc., 2026-05-19
- Second quarter 2026 results (6-K) — Canaan Inc., 2026-09-08
- Unaudited interim financial statements, six months to 30 June 2026 (6-K) — Canaan Inc., 2026-09-11
- December 2025 bitcoin production update (6-K) — Canaan Inc., 2026-01-14
- January 2026 bitcoin production update (6-K) — Canaan Inc., 2026-02-10
- Acquisition of Cipher Mining's interest in the ABC Projects (6-K) — Canaan Inc., 2026-02-24
- February 2026 bitcoin production update (6-K) — Canaan Inc., 2026-03-10
- March 2026 bitcoin production update (6-K) — Canaan Inc., 2026-04-15
- April 2026 bitcoin production update (6-K) — Canaan Inc., 2026-05-14
- May 2026 bitcoin production update (6-K) — Canaan Inc., 2026-06-11
- June 2026 bitcoin production update (6-K) — Canaan Inc., 2026-07-14
Disclosure
Firsthand Bitcoin sells and hosts mining hardware. This is our analysis of the company's public filings, not an audit in the accounting sense, and it is not investment advice. Every reported figure links to the filing it comes from; figures we estimated are labelled, with their inputs. No company paid for or reviewed this page. Corrections are published with the date they were made.