For the encryption currency industry, this winter to hear a word is probably the most “bear market”.
Because the continuous depreciation of assets, many miners mining business has been hit hard, difficult to profit. In some cases, some miners had to sell its exit business, in order to avoid bankruptcy. However, even in such a bad situation, some experienced miners can still find opportunity, even began to seize market share.
High wall, wide grain
Although many miners worldwide have closed the encryption (such as domestic currency mining business has tens of thousands of machine stops), but the bear market but to stimulate the creativity of miners, they began to try some new strategies more cost-effective, to their own encryption currency mining business can continue to flourish.
Matt Desouza (Matt D’Souza) is one of the “big four” accounting firms KPMG consultant, Blockware Solutions is the co-founder of the company, but also operator Aion Network’s a maximum mining pool. He admitted that although the bear market led to a lot of mining equipment shut down, but some experienced miners are becoming more and more creative, and began to grab more market share.
If you look back in recent years the miners will find their infrastructure development, the mainly has two characteristics, one is the site, the other is a low efficiency. Matt Desouza said, now still continue to operate most of the miners were bought in the two quarter of last year to the two quarter of this year’s machine, the closure of encryption currency mining market participants are basically in the fourth quarter of last year, or after the two quarter of this year to buy mills and signed a hosting contract. When the price of bitcoin trading at $9000, S9 series machine costs more than $2000, two-year contract price of each mining managed S9 machine for $120 a month.
The survival of the fittest
According to Blockware’s disclosure of the data shows that in the current market conditions, the managed S9 machine monthly price at $60-75, and the specific price depends on the number of units managed. Matt Desouza said:
“Like every cycle in the market — the person with low efficiency will be eliminated, and the positive innovation market participants will observe the failure of corporate mistakes and lessons, deploy more lean and efficient operation mode, and to build long-term competitive advantage. Even if bitcoin prices fell to $1500, we can still survive in the field.”
In general, each independent if the miners in their own home, or run mills at ordinary residential, to pay $0.13 per hour of electricity. But according to Blockware, signed a contract with the hosting infrastructure provider and per kWh of electricity price locked in the $0.06 to $0.07, the miners in bitcoin prices fell during the total cost will be reduced by more than 40%. Matt Desouza added:
“The current market interest rate lock two years hosting contract miners, like $3500 to buy bitcoin value investors, they like to buy two-year bitcoin futures contracts. The miners will hope the average cost of S9 machine lock between $60-75, and they can take the mining equipment price basically between $265-340. In other words, in the suppression of encryption of the money market, which is able to accept trustee fee by miners and mining equipment prices.”
On the other hand, for those who try to enter the new miners encryption currency mining industry, or is ready to further expand its mining operation of the old miners, it is important to calculate the capital expenditure, including the purchase cost of equipment construction and mining facilities, and the operation of mining equipment operating expenses, including electricity and mining capacity. Calculate a reasonable proportion of the digital input and output.
There is also a key factor to consider is the geopolitical issues, such as the current most mills are Chinese crypto currency manufacturing, and tariffs have become overseas miners must pay attention to the problem. According to Blockware, the United States and China is likely to consider the implementation of the new tariff policy, some large U.S. miners have been in accordance with the wholesale discount price to buy thousands of new S9 mill, if electricity and other operating costs do not change too much if the savings in the bear market in the mine could erupt in the future.
Matt Desouza concludes:
“Bitcoin bear market has some damage, but we are optimistic that the encrypted money market recovery, since many large mining operators, mining equipment operators, managed and individual miners will survive, and fundamentally restore vitality.”