Jim Ferraioli, Director of Digital Currencies Research at Charles Schwab, told Bloomberg that the firm’s entire investment framework for Bitcoin is anchored to miner production costs, a metric that places the current price dangerously close to the cost floor for the most efficient producers in the world.
Key Takeaways
- Best miners produce Bitcoin at roughly $60,000 per coin.
- Average miner cost sits at $95,000, creating a $35,000 gap.
- Schwab Crypto launched with a flat 0.75% fee, zero spread.
- RIA platform rollout targets mid-2027 for $5.3T in assets.
When Bloomberg’s Tom Keene asked Ferraioli what the underlying of Bitcoin is, his answer was direct.
“Energy,” he said. “It costs money to produce Bitcoin, and our entire framework for investing in Bitcoin and cryptocurrencies comes down to miner metrics. There are energy costs and infrastructure costs associated with producing Bitcoin. In any product, theoretically, the price of a product should be at a premium to the cost of producing it.”
The framework Ferraioli describes, commented in Schwabs official website, treats Bitcoin the way a commodity analyst would treat gold or oil, not as a speculative asset priced by sentiment, but as a produced good whose price should reflect, at minimum, what it costs to manufacture it. That cost, for the most competitive producers in the market, currently sits at approximately $60,000 per coin.
“For the best miners, those that have the cheapest energy costs and the most advanced fleets of ASICs, they produce Bitcoin at about $60,000 per Bitcoin,” Ferraioli confirmed.
That figure carries immediate relevance given where Bitcoin is trading. With current price at approximately $62,000 to $63,000, the most efficient miners in the world are operating at a thin margin above their cost of production. That is not a comfortable buffer.
What Happens Below $60,000
The natural follow-up question is what the production cost floor means for price if Bitcoin breaks below it. Ferraioli addressed it directly.
“In deep bear markets, for those top-producing miners, their cost of production has served as a bottom,” he said. The mechanism is straightforward: when price falls below production cost, mining becomes unprofitable, miners reduce or halt operations, the hash rate drops, and the network adjusts difficulty downward. That reduction in new supply eventually removes selling pressure from miners who would otherwise be selling freshly minted coins to cover operating costs.
NEW: $12.6 trillion Charles Schwab explains why their “entire framework” for investing in Bitcoin is because it’s backed by energy 🤯 pic.twitter.com/ch5Ts2LSox
— Bitcoin Magazine (@BitcoinMagazine) June 4, 2026
The average miner, however, operates at a significantly higher cost. As Ferraioli noted, “The average miner today, it costs them $95,000 to produce Bitcoin. They have higher energy costs. They have less efficient ASICs. And so they temporarily shut down operations when it becomes less profitable.”
That gap between the $60,000 floor for the most efficient producers and the $95,000 average production cost is structurally important. As price declines through the $60,000 to $95,000 range, a progressively larger share of the mining network becomes unprofitable, which reduces sell-side pressure from miners incrementally rather than all at once. The $60,000 level is where even the best operators begin to feel the squeeze, making it the most technically significant cost threshold in the current market.
Schwab Is Not Just Talking About Bitcoin – It Is Trading It
Ferraioli’s energy framework is not academic. Charles Schwab began rolling out spot crypto trading for eligible US retail investors in May 2026 through Schwab Crypto. The service allows clients to buy and sell Bitcoin and Ether directly alongside traditional stocks and bonds, executed at a flat 75 basis point fee with zero spread. Digital assets are held through Charles Schwab Premier Bank with sub-custody infrastructure handled by Paxos.
The service currently operates with constraints, it is restricted in certain states including New York and Louisiana, does not support external wallet deposits or withdrawals, and assets are not covered by FDIC or SIPC protections. Those limitations reflect the regulatory complexity of launching spot crypto custody at institutional scale, not a lack of commitment to the asset class.
For active traders, Schwab also rolled out 24/7 trading for select cryptocurrency futures on its thinkorswim platform, bridging the gap between always-on crypto markets and traditional brokerage hours.
The larger structural move is still ahead. Schwab’s advisor services platform, through which Registered Investment Advisors manage approximately $5.3 trillion in client assets, is targeting a mid-2027 launch of spot trading, asset transfer, and custody capabilities. When that rolls out, RIAs will be able to natively manage direct Bitcoin allocations within client portfolios, a capability that does not currently exist at this scale within a single traditional brokerage infrastructure.
Why the $60,000 Level Matters Right Now
The convergence of Ferraioli’s production cost framework and current market conditions is the most immediately actionable part of the Bloomberg interview. Bitcoin at $62,000 to $63,000 sits approximately $2,000 to $3,000 above the production cost floor for the world’s most efficient miners. Ferraioli was asked directly whether price could go below $60,000. His answer was unambiguous: “The answer is yes.”
What the energy framework implies is that a break below $60,000 would not represent a catastrophic structural failure but rather a temporary violation of the cost floor, one that, historically, has resolved upward as unprofitable mining operations shut down and new supply entering the market contracts. Whether that historical pattern holds in a cycle where ETF-driven institutional demand has changed the market’s structure is the question Schwab’s own research framework will be watching closely as June 2026 progresses.
The information provided in this article is for educational purposes only and does not constitute financial, investment, or trading advice. Coindoo.com does not endorse or recommend any specific investment strategy or cryptocurrency. Always conduct your own research and consult with a licensed financial advisor before making any investment decisions.
Kosta has reported on cryptocurrency markets and blockchain infrastructure since 2020, bringing over six years of hands-on experience in the crypto industry built through daily tracking of markets, trends, and emerging blockchain developments. Specializing in Bitcoin on-chain analysis, institutional ETF flows, and digital asset price action, his work at Coindoo has been cited by other news agencies and consistently covers market developments with a focus on data-driven reporting across Bitcoin, Ethereum, Solana, and XRP.
Over the years, Kosta has contributed to multiple crypto media outlets in different regions, authoring over 6,000 articles across the sector. His reporting spans cryptocurrency markets and the broader fintech industry, tracking not only price action but also the technological and regulatory forces shaping the ecosystem.
To support his analysis, Kosta actively leverages on-chain data and metrics from leading platforms such as Santiment, Glassnode, and CryptoQuant, enabling deeper, evidence-based market insights. He believes in the power of transparency and the data that underpins the blockchain ecosystem.
His academic background in Marketing Management from Denmark further complements his analytical approach, adding a strong understanding of communication strategy and content positioning to his work.
Be the first to comment