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Zero-sum Game in Chinese Crypto Mining Space, Lack in Machine Stock as Rainy Season Approaching

In order to relocate the mining machine from the hydropower-mining farms to the thermal power mining farms with the cheapest electric charge in a short period, Chinese crypto mining farm owners spare no expense even adopting air transportation to transfer the machines, which takes several hundred thousand Chinese yuan of freight. But the expense seems not worth mentioning compared to the electric charge and the mining profits.

As bitcoin mining block reward halved, and bitcoin price keeps volatile, many old machines of miners’ are gradually eliminated to the shutdown price, and a lot of miners are leaving the battlefield.

A small private crypto mining farm in China’s Yunnan province

Sully Yu, the agent of Whatsminer, one of the largest crypto miner makers appeared at the miner summit on May 23, carrying a suitcase. He flew from Taiwan to Chengdu. His friends are puzzled about this business trip. “Isn’t the economic environment bad now? Do you still have a business?” In fact, as the official agent of Whatsminer, Sully is busy after the launch of Whatsminer M30s in April.

“Ordinary miners emphasize the cost, while the institutional investors emphasize the annual income, so now the institutional investors dare to buy but the small miners dare not.”

According to Sully’s observation, the current mining machine buyers are totally different from those before, most are institutional buyers.

He said because the first batch of t production of Whatsminer M30 is very small, the current miner is futures whose delivery time has been scheduled to September.

In addition, unlike in previous years, now overseas buyers get a 40% increase in Sully’s customers, most of whom are from North America and Europe. Some people say that bitcoin mining is essentially a financial product of global energy arbitrage, while there are many places around the world have cheap electricity or even negative electricity prices.

The cost of mining gets higher and higher. The same thing happened to the miner maker. The cost of machines producing is much higher than before. The trend of network hashrate now depends more on the future market. Technology has always been good, but the question is whether we have the funds and ability to produce more computing power.

At present, mining machine manufacturers do not have such large pricing right. In the future, joint mining will become mainstream. In this case, it is more the relationship between mining machine investors and mining machine manufacturers.

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