SOURCE / ECONOMY
China’s Bitmain suspends crypto mining machine sales, after 90% capacity shut down in the country
Published: Jun 25, 2021 06:08 PM
Inside a Bitcoin mining factory 
Photo: AFP

Inside a Bitcoin mining factory Photo: AFP


 
China's biggest cryptocurrency mining machine-maker Bitmain announced that the company has suspended selling machines in the spot market globally as selling pressure piles up in the secondary market. The move comes after approximately 90 percent of China's Bitcoin mining capacity was shut down following a widespread government's ban.

"Some Chinese clients are selling mining machines to either recoup funds or reduce the time the machine remains in the Chinese mainland, resulting in huge pressure within the secondhand market," Bitmain announced at a post on its Wechat account, noting that the decision is to help smooth transition of the market.

The price of crypto mining machines has tumbled in recent days as Chinese miners - amid national crackdown against Bitcoin mining - rush to dump mining devices, the Global Times learned. 

While some Chinese miners have planned to ship machines overseas, others who failed to find safe overseas "alternatives" or decided to quit the business are forced to sell the devices, an industry insider told the Global Times on condition of anonymity. 

The supply glut in the secondhand market, plus lukewarm cryptocurrency prices, have also affected the profitability of mining machine producers, the insider said.   

With regard to overseas destinations, North America, Texas, Kazakhstan, and Russia are among the overseas hotspots for Chinese Bitcoin miners, according to industry observers.

Bitmain said that its business staff, along with clients, have travelled to countries such as the US, Canada, Australia, Russia, and Kazakhstan to look for "quality" electricity resources overseas. It announced earlier that it has invited guests from the US and Kazakhstan to provide consultations on local legal and tax framework to clients.

Another Chinese mining machine producer, Canaan, said on its website on Wednesday that it has launched crypto mining business in Kazakhstan. A new business entity that operates mining business was also set up in Singapore to comply with regulatory requirement.

To date, Southwest China's Sichuan Province, Northwest China's Xinjiang Uygur Autonomous Region, North China's Inner Mongolia Autonomous Region and Southwest China's Yunnan Province have all announced rules curbing Bitcoin mining. That means more than 90 percent of Bitcoin mining capacity, or one-third of the global crypto network's processing power, will be suspended in the short term. 

In May, senior Chinese officials said that it is necessary to crack down on Bitcoin mining and trading, and resolutely prevent the transmission of individual risks to the wider society.

Global Times


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