---
type: claim
domain: space-development
description: "Model A (water for orbital propellant) closes at $10K-50K/kg avoided launch cost; Model B (precious metals to Earth) faces the price paradox; Model C (structural metals in-space) is medium-term"
confidence: likely
source: "Astra, web research compilation February 2026"
created: 2026-03-20
challenged_by: ["falling launch costs may undercut Model A economics if Earth-launched water becomes cheaper than asteroid-derived water"]
---

# Asteroid mining economics split into three distinct business models with water-for-propellant viable near-term and metals-for-Earth-return decades away

Asteroid mining economics are not one business case but three fundamentally different models, each on its own timeline.

**Model A: Water for in-space propellant.** The consensus near-term viable business. Water in orbit is worth $10,000-50,000/kg based on avoided launch costs, meaning a single 100-ton water extraction mission could be worth ~$1B. TransAstra's analysis suggests asteroid-derived propellant could save NASA up to $10B/year. The critical enabler is orbital propellant depots creating a market before any material returns to Earth.

**Model B: Precious metals for Earth return.** The popular narrative but facing fundamental economic problems. Platinum trades at ~$30,000/kg and asteroid concentrations far exceed terrestrial mines (up to 100g/ton vs 3-5g/ton). But any significant supply of asteroid-mined platinum would crater terrestrial prices, making the operation uneconomic. This is the price paradox: the business is only profitable at current prices, but success at scale collapses those prices.

**Model C: Structural metals for in-space manufacturing.** Medium-term opportunity. Iron and nickel from asteroids are often in free metallic form (unlike terrestrial ores requiring energy-intensive refining), suitable for building structures in orbit that could never be launched whole from Earth. Only activates once in-space manufacturing reaches industrial scale — probably 2040s onward.

The investment implication: near-term capital should flow to Model A enablers (water extraction technology, propellant depot infrastructure), not to Earth-return mining. The timeline is water first, structural metals second, precious metals last if ever.

## Challenges

The ISRU paradox applies directly: [[falling launch costs paradoxically both enable and threaten in-space resource utilization by making infrastructure affordable while competing with the end product]]. If Starship delivers water to LEO at sub-$100/kg, the avoided-launch-cost calculation for Model A changes dramatically. The economic case for asteroid-derived water depends on the destination being beyond LEO (cislunar, Mars transit) where launch costs compound with delta-v requirements.

---

Relevant Notes:
- [[orbital propellant depots are the enabling infrastructure for all deep-space operations because they break the tyranny of the rocket equation]] — depots create the market that makes Model A viable
- [[water is the strategic keystone resource of the cislunar economy because it simultaneously serves as propellant life support radiation shielding and thermal management]] — water's multifunctionality is why Model A closes first
- [[falling launch costs paradoxically both enable and threaten in-space resource utilization by making infrastructure affordable while competing with the end product]] — the ISRU paradox directly constrains Model A economics

Topics:
- space exploration and development
