Price War Start Against Mining Operators in Sichuan As Supply Far Exceeds Demand
The former director of Bitmain’s mining farm once said the wet season may not be the final straw for miners. As he expected, mining farms in Sichuan currently reported that the supply of slots for mining equipment has far exceeded the demand.
The wet season in Sichuan usually begins in April and ends in October every year. During this time, the cost of the electricity can be as low as 0.25 yuan in a Sichuan mining farm, which should be very attractive to miners while the price of electricity is around 0.35 yuan in Xinjiang and Inner Mongolia.
Some industry insiders speculated that 80 percent of the mining farm operators in Xinjiang and Inner Mongolia would move to Sichuan and Guizhou. It was also reported that many farm operators started their migration even before the Chinese Lunar New Year in February, they can’t wait to make a profit throughout the long crypto winter.
However, no one would expect that there were fewer miners left after the market crash.
According to the founder of Tiantian Ming Farm, mining farm operators have added 500,000 slots compared to the same period last year but haven’t sold much of them yet. The balance of supply and demand has been broken.
In addition, there is another bad news: the standard market price of electricity in Sichuan is 0.26 yuan, but in fact, many mining farm operators cut the electricity price under the table in order to sell their mining slots faster. Bitdeer is the first one to start the price war. The firm launched a “Wet Season Combo” with an extremely low electricity cost of 0.22 yuan on Marth 30.
It seems that the majority of crypto miners have learned to evaluate and investigate before impulse investing, the market is becoming more rational.