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New Miners of the 21st Century: What Do They Look Like in Sichuan Province?
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Mining
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Sichuan, a mountainous province in southwestern China, is home to an increasing number of bitcoin mining sites.
Kun, 29-year-old, is a management operator of a bitcoin mining site which is actually just a plant built near a hydropower station. After working for 24 hours nonstop, the 550 mining machines are able to mine 2.5 bitcoins per day.
In the first few years after bitcoin was born, one was able to mine bitcoin with just a computer, a GPU and a specific procedure. But now bitcoin mining has evolved into a very competitive business. Miners have to invest more in mining machines. And a dorm for workers is now filled with packages of mining products.
“You don’t need to be an expert to be in the business,” said Kun. He monitors the functioning of mining machines with applications on his mobile phone and computer. When anything goes wrong, he simply restarts the computer or replaces the power supply. If he is unable to fix a problem, he would return the machines to the producer for repair.
“High profits are the beauty of it. I got my money back in a year, much shorter than that of traditional sectors.”
Kun and other bitcoin workers at the hydropower station invest more in machines with better computing power. They roast a whole lamb to celebrate the increase of hashing power. Last May, Kun decided to purchase some more new machines.
With abundant water resources, Sichuan has become “the city of bitcoin mining”. Bitcoin miner Mr. Liu migrated his mining pool to Sichuan to save on cost and electricity prices.
“Before I was at Henan province and the price of electricity is about 0.4 yuan/kw. Now Sichuan is in wet season and is filled with surplus water and electricity. We are helping consume them, it’s something nice to do.”
“Many believe that it’s more profitable to invest in bitcoin than real estate or stocks,” said Liu and behind him noisy machines.
Liu said when he first started mining, the total network hashrate was less than 1000P, but now it’s 4000P.
Rich people also want to be part of the business, but they don’t want to stay in such remote areas. Liu helps them find a place, buy machines, set up a mining site and make money. Now Liu manage 7000 mining machines.
N.G. ZHANG invented the world’s first bitcoin mining hardware product named Icarus using FPGA technology. And about 90 percent of the mining community are using machines of Antminer and Avalon.
Workers are assembling machines on the assembly line. Finished products are always sold out in a few days.
Sun, who witnessed the closing down of ASICMiner, is now a management operator of a mining site in Sichuan. With no other entertainment, he plays mobile games and WeChat every single day.
“It’s lonely. But since I can find no place to spend money here, I can save all my salary.”
When be asked if he buys bitcoin, he smiled and nodded his head.
I have been living two lives. In one life, I am a news editor of 8btc. I translate news, interview bitcoiners and miners. In the other life, I am an AI bot programmed to .......Forget it! Who is gonna buy this BS! I'm just me, Cindy, nobody else.
COMMENTS(32)
Here is the link to the original comment thread. Or you can comment here to start a discussion. Author: 8btccom
Roasting whole lambs, using surplus hydro, (being nice lol) and buying more BTC. Spicy food for dinner in Sichuan, yum, what a time 2B alive.
I enjoy the idea of talking to those operating large mines in China, seeing the photos of the mines and getting a better understanding of the people who work them. But…
Really poorly written article.
Before I was at Henan province and the price of electricity is about 0.4 yuan/kw. Now Sichuan is in wet season and is filled with surplus water and electricity.
This is the reason why home mining in western countries isn’t feasible today and we won’t see “decentralized mining” again. These chinese enterprises leave regions where electricity costs 0.0589 USD/kWh in favor of locations with even cheaper power, possibly below 0.04 USD/kWh. Add economies of scale on top of that and it becomes pointless to even promote home mining.
Keeping in mind the author is Chinese it’s better than nothing. Actually I quite enjoyed it.
This is true. Would love an American documentary on amazon!
Article doesn’t say what kind of miners they use.
Luckily we can still run full nodes. And we should make sure that doing so remains a possibility for home users.
The machines in the photos are antminers. You can barely make out the blurry logo on the badge attached to the end of the units.
My boss banned smoking in the server room last year. Lucky guys.
Hopefully, ASICs will become a commodity soon and everyone will be able to mine again: decentralization!
Beautifully explained by Andreas: https://www.youtube.com/watch?v=BuqZvdA08JE
SECTION
CONTENT
Title
Bitcoin Q&A: Will hardware advancements, which centralised mining, help re-decentralise it?
Description
Keywords/phrases: The problem of mining centralization, anti-fragility with decentralization of computing power. How centralization occurred through advancements in mining hardware engineering and connections to silicon fabrication (100-10,000x performance increase). The factor of racism in worries about centralization. Impact of 16nm technology in computer processing and performance, Moore’s Wall.
Length
0:08:04
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I’m not smoking but for some reason “smoking” and “server room” seems to be a really dangerous situation… also poor fans.
But his explanation (even assuming the 16nm / moores wall) is that centralized warehouses/cooling will break and they will just give up?
and ‘we haven’t experience the nightmare scenarios’ simply because jihan wu/etc still are printing money and havent been challenged yet
Read it, look at the pictures, and ask yourself… Those 24 hours spent setting it up.. were any of them spent on Reddit pondering Big Blocks vs SegWit, or which Blockstream employee is the Devil today? The place has standing water in it, three guys with cigarettes, and some meat roasting over a fire outside.
They’re turning surplus power to yuan and heat, with as little overhead as possible. You won’t reach them here.
There are Chinese people who can write proper articles too, you know? 😉
Still, I agree with you, better than nothing. Very interesting to see this happen in Sichuan, I used to live there. Too bad they didn’t even mention where it is exactly.
This is a great article Cindy!
Mining is such a fascinating industry and Bitcoin Core wants to kill it, they are ungrateful.
As for the lamb, this is what I will be having for dinner 😉
The end of home mining does not mean mining will not end up more decentralized than it is today.
No you misunderstood him, I suggest watching again.
It does look pretty good. I was worried they were roasting over cardboard boxes, but it looks like a proper wood fire. Bon Apetit!
I watched a short one recently, it’s Vice but it’s not too bad.
Good article.
When be asked if he buys bitcoin, he smiled and nodded his head.
He may not read Reddit, but if he’s a holder he cares about the utility of his coins.
24 hours spent setting it up
Incredible what one can accomplish with 24 hours and enough backing. Incredible logistical operation.
It’s literally linked in my previous post… click the blue “short one”.
I’ve been on his youtube and watching all his talks-
He agrees on every metaphor of technology constantly expanding, email replacing mail , etc, and uses this example for every point EXCEPT that ASIC processors are capped out and suddenly all hash power will even out. (and there is no rebuttal to the potential for one such hardware advancement to be patent protected, and it only takes ONE) Feels like its picking and choosing.
2nd- He agrees that the concept of Bitcoin is obviously disruptive to govts/central banks and that they will do what they can to stop it, but ‘they are powerless’, but then when confronted with points like ‘what about a state sponsored 51% attack, state sponsored quantum computing attack, or issues that he hasn’t considered like a stuxnet attack on miners, his response is “oh they have bigger fish to fry, they wouldn’t use their one attack on BTC” . Again picking and choosing, is it a disruptive threat that they must handle, or something insignificant that they wouldn’t use resources on.
If i’m truly ‘misunderstanding him’ then how are these points refuted, or at least reconciled by him because it really feels like he is picking and choosing.
I’m not even trying to sound internet mad, I really would like to discuss this (the hardware level issues and the interaction with real world governments issue, I agree its fruitless to talk about BTC price/bubble etc- the fundamentals should come first)
and uses this example for every point EXCEPT that ASIC processors are capped out and suddenly all hash power will even out
Because that’s what’s happening for ASICs, same happened for CPU, we are stuck around 16nm and that’s where ASICs are now, so there is no way to get ahead of others by going smaller anymore, for a while.
Because of this more and more manufacturers will have access to 16nm and thus more and more consumers -> decentralization.
Right but just like every advancement before , its “for a while”, it doesn’t stop the trend with the major actors at the top having the most real world resources and the fastest acceleration.
It’s the point: a while is gonna be a few years here, vs. a few months before, that’s exactly what is needed to even out access to those chips to everyone.
ASICs catch up with CPUs, that’s where we are now, but they won’t break the barrier that CPUs are facing (CPUs have way more R&D budget, and they are stuck) , so it’s gonna be a status-quo for a while, and the exclusivity of those few miners will dilute.
I’m not disputing months vs years, I’m talking about end behavior-
tech WILL advance and it people with more real world resources will have an immediate disproportionate advantage. (and that will always be govts who can print money, if BTC/crypto even hits the threshold where it is potentially disruptive)
The founding fathers had a similar vision of a militia standing up to corrupt governments with muskets, but now we have a govt with trillions of dollars in drone strikes/ missiles/ cyber warfare- its one sided.
You are just trying to stretch a technical problem into a philosophical one, you might be right, but it’s totally out of context.
Was just trying to explain you Andreas point, as you asked for help. Seems like you just like to argue… 😉
No offense, everyone has hobbies.
I just honestly feel like no one has disputed these issues (to his credit Andreas has been the closest person i’ve seen to at least discussing them)
I think you fundamentally have to pick a camp between
crypto is disruptive enough to central banks/govts that it will warrant action
gov’ts wont take action because crypto TRANSACTIONS haven’t made any disruptive impact
Andreas is still picking and choosing bits from each.
I don’t see how that is out of context if we are trying to validate the scope of a new technology, and they are points that he touched on but didn’t really refute.
(Im genuinely glad you are at least answering because no one else has even responded to refute these issues (ive tweeted at Andreas but i’m sure he is busy..))
Kun, 29-year-old, is a management operator of a bitcoin mining site which is actually just a plant built near a hydropower station. After working for 24 hours nonstop, the 550 mining machines are able to mine 2.5 bitcoins per day. He would roast a whole lamb with other workers to celebrate when they buy new machines. But it also feels lonely. http://news.8btc.com/new-miners-of-the-21st-century-what-do-they-look-like-in-sichuan-province
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