How a 5% Difference in Cache Hit Rate Spikes Token Cost 3-4x
Xianbao_QIAN · x · 2026-08-04
The author analyzes the appeal of the DeepSeek model from a fresh perspective: cache hit rates. On the surface, a 5% difference between a 90% and 95% hit rate seems negligible, but it has a massive impact on the final cost.
Assuming the price difference between a cache hit and a miss is 50x, calculations show that this mere 5% gap in cache hit rate actually makes the average token cost 3 to 4 times more expensive. The author praises DeepSeek's long-term engineering efforts to minimize KV Cache size and retain it longer, which translates to substantial savings for users.
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