China’s decision to close down Bitcoin exchanges has been met with a mixture of anger and confusion by bitcoin enthusiasts, and now the world’s largest bitcoin mining equipment producer, Bitmain, has weighed in on the matter. Speaking to the South China Morning Post, Bitmain said that it did not think that the central bank’s decision would have long-term repercussions.
Bitmain, a major bitcoin mining hardware producer based in Beijing, has received an official warning from the Chinese government, that they halt all of their sales of mining equipment. The company has been ordered to stop selling all industrial mining equipment, including their Antminer machines, as well as any related accessories by the end of the year.
Two weeks after the 15% increase in electricity prices, Turkey opened a new power plant on the 13th. In July, a new professional shop for mining equipment was opened in Istanbul, the country’s economic centre.
Starting a mining company in a country where electricity is expensive seems counterintuitive. But Phoenix Store, Bitmain’s business partner in the Middle East, did some good math before opening its second store in the region. Phoenix CEO Phil Harvey explained that the main purpose of opening a store in Istanbul is to educate the Turkish population about crypto-currency mining. Customers can then purchase mining equipment and accommodation services operated in Canada, the United States or Russia. Mining in Turkey is just not feasible.
It’s like if you want to invest in a gold mine, he said, you can come here and invest in a gold mine, but it won’t be in the backyard. It’ll be outside.
Cointelegraph from India spoke to Phil Harvey after his speech to find out more about the state of cryptocurrency mining after the restrictions imposed by China.
China must maintain current growth for projects in the country, Harvey began, describing the crackdown. To receive IMF or World Bank financing, a country must improve in several areas, such as B. reduce its carbon footprint :
The easiest industry to eliminate overnight was the gray sector. Some 68,000 gigawatts of electricity were immediately extracted from China by simply saying no to bitcoin mining.
This is an important source of revenue, but it pales in comparison to the money the IMF or World Bank invest in China for projects such as road initiatives. So it was easy for China to remove these miners and reduce the carbon footprint they create, Harvey said.
Although some miners have announced that they will move to colder climates such as Canada, Harvey believes that half of what was lost due to Chinese repression will never be put back into operation:
Because these are old machines that had been stored for many, many years and were only producing five to ten percent, and they were running out. But there is no commercial interest in taking them away and moving them now.
Related: China’s ban on crypto-currency is a big opportunity for Canada, says head of mining group
The cost of the machine could be as low as $150 or $200, and about the same amount would be needed for transportation. There’s no point in doing that, he said, which is why I say we’ve lost half of what was online.
Harvey expects regions such as Russia and Kazakhstan to increase their share of mining activity as new machines are added to the network, but he has no plans yet to open new sites in those countries. After Dubai and Istanbul, Phoenix only wants to open another store in London. We will not develop stores outside of these three locations, he said.
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