Bitcoin Mining Status in China: Giants Earns $11 Million in 2 Months While Small-scaled Miners Choose to Quit the Game
As bitcoin slides and the regulatory tightening these days, small-scale bitcoin miners choose to ‘stop daydreaming’ and quit this industry while the mining giants in China are upping the ante to join in the game. Their average revenue have surpassed 70 million Yuan ($11 million USD) in two months and many of them plan to set up new subsidiaries overseas.
According to a new statement from the Internet Financial Risk Regulatory Work Team of remediating illegal mines. Initial news of Chinese government wants to slowly quash the mining ecosystem also makes Chinese miners rethink about their future development.
The Vice Chairman of Chinese Securities Regulatory Commission (CSRC) also stated that China is going to strengthen supervision and control over bitcoin in the Davos Forum on January 23.
In this tough living environment, an early miner sales said “the diversion of mining industry might soon exist, the small-scale miners will gradually disappear and the Bitcoin industry will be controlled by mining giants, they already made the plan of mining abroad.”
As financial and regulatory risks arise, it is the time for small-scale miners to stop day dreaming. A miner with only two mining machines just sold them all.
He said “No one knows what regulatory policies will be made by Chinese government, big miners may afford this kind of risk-taking but for ‘individual miners’ like me, the cost of mining and the regulatory risk are so high and we are going to quit the mining business.”
By his own calculations, power of his mining machine is 1350 watts, keep running 24 hours a day, he can get 0.0018 bitcoin. Thus, it takes about 556 days to mine one bitcoin. The daily power usage of the mining machines is 32.4 kWh and the daily cost of electricity is about 16.8 yuan, ($2.67 USD) so the cost of mining 1 bitcoin is about 9367 yuan ($1487 USD).
Electricity costs 70% of the cost of mining, the other 30% comes from mining machine losses, labor costs and so on. According to this calculation, the cost of successfully mining a bitcoin is about 13,000 yuan ($2064 USD).
Bitcoin price is about $9195.7 today, it is certainly that bitcoin mining is still profitable, but small-scale miners may retreat from this industry.
In the mining machine market, new miners’ supply falls short of demand, big mining giants are fighting for the best equips. The factory price of an AntMiner S9 is about 16,000 yuan ($2540 USD), however, it is very hard to get and the price goes up to 28,000 yuan ($4446 USD) in the secondhand market. Large-scale miners are upping their ante in the bitcoin mining kingdom.