58% of bitcoin mines have “key person risks” in China

hyip investor blog hongwei 2018-7-13 Currency News 8 0 0

The impact of the Sichuan flood on the global bitcoin computing power seems to be worrying, but some insiders have expressed deeper concerns.

Some analysts told the Daily Economic News reporter that if any major blow to the Sichuan Bitcoin mining pool would affect the global hash rate. It further stated that Chinese miners still dominate the cryptocurrency, and China's bitcoin mining industry has a “key human risk” for the entire bitcoin industry (ie, the risk of losing a key person will be devastating to the collective) ).

At present, China is almost monopolizing the bitcoin mining industry. According to iResearch, the global Bitcoin mining machine manufacturing market is dominated by the three major producers of Bitian, Jianan Gengzhi and Yibang International, and these three major manufacturers are Chinese companies. In 2017, the total sales revenue of the three companies And sold power accounts for 90% of the world.

A bitcoin industry research report from Cambridge University in April 2017 showed that 58% of the world's bitcoin mining plants are located in China, while the second largest US only accounts for 16%.

Mining is prevalent in China, and a large part of it is due to the huge demand for electricity in the industry, while domestic electricity prices are lower than those in some countries.

There is a point of view that there is no more leap in the iterative aspect of the chip. "The current competition is no longer the ability to compare a single chip, but how many chips a mine can plug in, and handle the problem of heat dissipation and power supply. "There is even a saying in the industry that "electricity determines the power, and the power determines the wallet."

According to a report by Morgan Stanley in May this year, high energy demand is also a challenge in the Bitcoin industry. The report mentions that POW (Proof of Work) is used to secure bitcoin transactions. The demand is huge.

Affected by some of the above factors, the domestic tightened policy on bitcoin mining. According to relevant reports, in January this year, the Mujin Remediation Office issued documents to all localities, requesting comprehensive measures such as electricity price, land, taxation and environmental protection to guide enterprises within the jurisdiction to orderly withdraw bitcoin mining business, and regularly report the progress of the work. .

According to reports, large domestic mines have begun to transfer some of their business to countries with lower electricity costs such as Canada and Iceland. For example, Bitmain, which operates China's two largest bitcoin mines, has set up branches in Singapore and conducts mining operations in the US and Canada. In January of this year, the founder of the BTC.Top, Jiang Zhuoer, also said that the company is opening a branch in Canada because the cost of operating the mine in Canada is relatively low and stable.

Some small mines are also flexible in finding a living space. The operators of a small mine said to the reporters of the Daily Economic News that "there was no place in the past, but also changed from hydropower to electricity."

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