China sparked a wave of Bitcoin mining


Alex Bramer, Vice The business development president of Luxor Tech, a US cryptocurrency company, described his experience of being bombarded by phone calls from Chinese miners within a few hours of his speech on May 21. “We received a call from a large miner, trying to find the power of matching space throughout North America,” he said. “We got a call and the question asked was,’Can you hold 20,000 machines in 14 days?’ For example. The tone in the industry is crazy.”

“Interestingly, I would say a lot [miners] Will leave China in the next 30 to 60 or 90 days,” Bramer added.

Van Kirk of Kaboomracks said that non-Chinese entrepreneurs may be the first to stand up. “We have some customers in China, but they are Westerners, and they want to find capabilities outside of China,” he said. “They are looking for something in the United States or Canada.”

As a potential destination, not only North America is sought after. Parts of Northern Europe and Latin America are also under consideration; overall, Brammer said, some Chinese want to transfer their business to a “political stable, with strong property rights, with some type of existing and some Stable regulatory framework”. However, the United States, already the world’s second Bitcoin mining country, may prove particularly attractive.

This is not to say that moving is easy. Brammer said that logically, shipping tens of thousands of machines from China to the United States is a nightmare, especially when the global pandemic has triggered Shortage of containers, And a potential trade war, which will require any company seeking to ship goods from China to the United States to pay 25% tariff. Even if mining machines are unloaded from private cargo planes or container ships, it will take some time to establish a new mining business in North America. “some of them [Chinese miners] Come in and they say,’We want to buy 500 megawatts of capacity,’ and you have these North American power generation facilities and mines,’we just don’t have that,'” said Bramer. He estimated to build a large mine from the ground up The time period is approximately 12 to 24 months.

Edward Evenson, director of business development at Bitcoin mining company Braiins, is more optimistic. He said that most large miners will only ship new machines from manufacturers outside of China, and they will have the resources to achieve this goal relatively quickly. “Smaller miners may not have the resources or connections, so they may have to sell their machines,” Evenson said. “But larger operations will only move their machines to a more stable environment for mining.”

However, the biggest question is whether panicked calls will cause a real outflow. In fact, most Chinese miners are currently waiting for the government’s next move. “In our observations, Chinese miners have a higher risk tolerance than Western miners, and they have largely adopted a wait-and-see attitude,” said Ian Wittkopp, vice president of Sino Global Capital, a Beijing venture capital firm. . “Most Chinese miners have gone through a similar news cycle in the past. The cost of moving to a new location can be high, and we expect most miners to wait for more clarity before relocating.”

This is not the first time China has waved a fist against Bitcoin. But this harsh posture has never really put the country’s booming Bitcoin industry into trouble. “Whenever the price of Bitcoin soars and the speculative frenzy surrounding it overflows, the government makes one of the announcements,” Evenson said. “Since 2013, they have basically done this every year or every other year.”


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