On June 18, electricity providers in Sichuan were asked to stop supplying power to miners in the province. Sichuan is the third province in China to impose this cut-off of supply to miners, following Inner Mongolia in 2020 and Xinjiang in 2021. Until May 2021, China owned more than 2/3 of the bitcoin mining. On the other hand, with the series of regulatory measures hitting this activity, miners are pulling the plug on their devices in order to move or sell them. All this leads to a drop in hardware prices.
Bitmain, master of supply and demand
Bitmain, the world’s leading manufacturer of mining devices, has suspended sales worldwide. The aim of the maneuver is to support the price of second-hand devices. With the massive exodus of Chinese miners, the market for used mining equipment is already starting to saturate. Indeed, the price of the latest ASICs has reportedly fallen by more than 75%, according to Bloomberg.
On the second-hand market, devices from Bitmain and rival Whatsminer are now selling for about 150 yuan ($23) per terrahash/second, down from 600 yuan in April, when bitcoin hit a record high of $64,000. However, a Bitmain spokesperson said sales of devices dedicated to altcoin mining would not be halted, as they are not the target of repeated attacks by the Chinese government.
By reducing the supply of the latest device, Bitmain intends to influence prices so that miners can dispose of their devices without incurring too great a loss. If this move is successful, the company will strengthen its customer base, which will be more inclined to buy back its equipment.
Last week, Bitmain held a closed-door event with hundreds of minor customers at a hotel in Chengdu. The company has pledged to act as an intermediary to help miners set up shop in countries, such as the United States and Kazakhstan. Finally, it seems that Bitmain itself is considering expatriation and has reportedly already begun relocating some of its top executives.
