The following is the Mining machine sold out, chip cut off, and graphics card removed from laptop From Bitcoin mining craze recommended by recordtrend.com. And this article belongs to the classification: Blockchain.
Source: financial stories
Acquisition / writing / Eternal
Editor / Chen Jiying
This may be Li Wen’s most successful investment.
In June last year, he spent 70000 yuan to buy 10 second-hand mining machines. Not only did the price of bitcoin dig up skyrocketed, “the price of mining machines also increased several times, earning two ends of money.” Li Wen was very proud.
Peter, who entered earlier, gained more.
In the summer of 2019, he spent about 2 million yuan on 200 Shenma M20S mining machines, and so far has produced more than 50 bitcoins at a price of more than 16 million yuan. Excluding the monthly electricity charge of 150000 yuan, the net profit is more than 10 million yuan.
Peter intends to hold more than 50 bitcoins for a long time, because he believes that in the long run, the price of bitcoin will rise.
Today’s miners are as fanatical as the gold miners of the 19th century American West. At that time, adventurers used pickaxes and sweat to excavate wealth, while today’s miners use chips and electricity to expand territory.
Although the speed of mining is getting slower and slower, the enthusiasm of miners has only increased under the soaring currency price – and the whole mining machine, graphics card and chip industry chain has been more or less reconstructed.
Mining machinery soaring, hard to find a good
“Mining has really improved my life. It’s not a small thing. It’s a big change.” Li Wen, a 45 year old bitcoin miner, lamented the financial stories.
In June 2020, Li Wen spent 70000 yuan to buy 10 second-hand Shenma M20S mining machines, each with a computing power of 65t. These 10 mining machines can dig a bitcoin every year, which is worth more than 300000 yuan according to the current currency price.
After starting mining machinery for a period of time, he thought the rate of return was good, so he invested another 700000 yuan before the end of the year to buy more than 50 different types of mining machinery, and directly handed them over to the Inner Mongolia mine trusteeship.
In the eight months since entering the mining circle, Li Wen has hoarded more than 2.5 bitcoins, worth at least 700000.
Li Wen is actually a “familiar customer” of the coin circle. After contacting the currency circle in 2017 and getting used to the volatility of the currency market, Li Wen decided to enter the relatively safe mining industry.
But now, mining machines and graphics cards have been “hard to get”.
When he first bought the equipment eight months ago, there were many physical stores selling mining machines in Beijing. The old and new models could be bought in stock, and the price was not expensive, even second-hand goods could be found. Now, because of the shortage, most of the mineral machinery stores have already closed down.
“As far as I know, many people Book mining machines directly with manufacturers, most of them are group buying. The stock has not yet been sold out. ” Li said.
The major channels of mining futures is also difficult to seize, the price also increased 2 to 3 times.
According to the official website of head miner bitmainland (which produces ant miner), all relevant bitcoin miners are sold out, and the delivery time is delayed to August 2021.
Jianan Technology (manufacturing Avalon mining machinery), another manufacturer, has obtained a large number of pre-sale orders in the third quarter of 2020, and continued the momentum of a large number of pre-sale in the fourth quarter. At present, the futures orders of the two companies have been arranged to the third quarter of 2021.
And in retail channel, miner can resell to the official website more than 2 times the price.
Take bitcontinental’s ant miner s1995t as an example. The retail price of the machine whose official website price is about 20000 yuan easily exceeds 50000 yuan.
Futures prices are also soaring.
In March 2020, the futures price of ant S19 is only about 13000 yuan, and the spot price is about 15800 yuan. With the sharp rise of bitcoin since November, the price even soars to 53000 yuan in January 2021, which is three or four times different.
Prices are soaring and orders are soaring.
An inner Mongolia mine owner told financial stories that since November, the number of mine orders has increased rapidly. In the past, the single investment volume of the customers in the group was 50-200 mining machines. Now, many of the customers in the group started to order thousands of mining machines, and the largest order directly ordered 5000 mining machines, which is unprecedented hot.
At the same time, the mining machinery market is booming, the industry is also in the process of integration.
It is reported that cipher, a subsidiary of bitfury group, which is famous for manufacturing mining machinery and equipment, has been working with GWAC.US The company has reached a merger agreement and will be listed on NASDAQ through spac, with a valuation of about $2 billion. As an independent company, cipher is expected to become a bitcoin mining champion centered in the United States.
In view of the current mining frenzy, Li Wen said: “these people are just like hungry beggars. They rush to see bread.”
In today’s prosperous mining area, the trauma of “312 incident” seems to have disappeared.
In March last year, the US Federal Reserve adjusted its monetary policy and the offshore US dollar tightened sharply. Bitcoin plummeted 25% in a single day and then fell below the “shutdown price”. The mine disaster caused the shutdown of more than one million mining machines and a short-term decrease of 27% in the total power of the whole network.
At that time, many miners sold equipment at a low price, just wanted to throw out the “waste” in their hands, and the whole mining area was in a depression. Now, the original value of only a few thousand yuan of second-hand mining machine, are soaring to 20000 yuan a set.
As for the craziness of today’s mining market, Li Wen is not surprised. “Compared with half a year ago, although the average price of mining machinery has increased by two or three times, the currency price has increased by more than 4.5 times, and the return cycle has been significantly shortened. In the past, it took a year for many bitcoin mining machines to get back, but now it takes less than eight months. “
Ethereum mania: graphics card is robbed, notebook is not let go
Unlike Li Wen, who focuses on bitcoin, Peter, a 25-year-old miner, is going to double manage his company and excavate ether coins at the same time.
“We have made a plan to buy more than 1300 graphics cards with 5 million yuan. At present, I am waiting for the centralized purchase to be completed.” He said that the GPU is a powerful tool for mining ether coins, and these graphics cards will be used to assemble mining machines.
It is understood that the mainstream of the Ethereum mining machine on the market is the graphics card mining machine. The core components are independent graphics cards with AMD and NVIDIA as the main sources. A mining machine needs at least 6-8 graphics cards. There are also many miners through personal computer graphics card mining. Graphics card has become the iron pick of Ethereum miners.
Some people think that in recent years, the price of graphics cards has risen, and even now NVIDIA RTX 30 series and AMD RX 6000 series are “hard to get one card”, which is largely due to the huge demand of Ethereum miners for graphics cards.
In order to meet the needs of computer game players, NVIDIA has to intervene, claiming that it will limit the hash rate of geforce RTX 3060 GPU to reduce the attraction of the chip to Ethereum miners. At the same time, NVIDIA CMP, which is specially used for mining, will be launched.
This series of mining chips even have no display output, and have lower core peak voltage and frequency, so as to obtain higher mining efficiency. They will be launched in the first and second quarters of this year.
It can be imagined that the bull market of digital currency has brought significant stimulation to the whole mining machinery industry and even the chip industry.
In the view of Wang Feng, founder of langang interactive group and CEO of Martian cloud mine, a blockchain media Martian financial and computing service platform, whether the digital currency mining equipment and computing power can be updated and iterated quickly still depends on the chip manufacturer.
In the past, the major chip manufacturers regarded the mining machine chip business as a small business, which marginalized its production and R & D, and then affected the whole supply chain.
According to Huaxia times, micro bit (Shenma mining machinery) is temporarily unable to plan the futures market for the new year due to insufficient chip supply.
And in Shenzhen, the source of China’s mining machinery supply chain, some mining machinery factories, because of the lack of chips, have simply come up with the idea of notebook computers.
“I just got through a communication with an Ethereum mining machine factory. Now they are short of graphics cards, so they just bought more than 10000 game books and took out the graphics cards to make mining machines.” Shang Silin, President of Mars cloud mine, told financial stories. He believes that the premium of Ethereum mining machine exceeds the price of notebook.
Wang Feng is not surprised by the reason why the major chip manufacturers despise the miner chips. “For example, in the eyes of chip giants like Samsung or TSMC, mining business is insignificant. Not to mention when the price of bitcoin is not high, even with the current price estimation, the total value of 200000-300000 bitcoins produced by millions of mining machines in the world in a year is less than 18 billion US dollars. That’s less than 10% of Samsung’s revenue last year. “
He believes that compared with the smartphone industry, the encryption assets and mining machinery industry is still too small in scale.
However, with the recent popularity of bitcoin and Ethereum, some chip manufacturers may, like NVIDIA, begin to pay attention to mining machinery business.
Hidden in mineral machinery, ASIC and GPU chips are abstract concepts called “computing power”. It can be said that the root of the craziness of miners all over the world and the frequent updating of mining machines lies in computing power.
What is mining: the game of computing power, the land of mining pool
For outsiders, bitcoin, blockchain and mining are familiar and unfamiliar.
The core technology of bitcoin network is blockchain.
Blockchain, from the perspective of application, is a public account book, the most important feature of which is “decentralization”.
In the traditional centralized financial system, power is concentrated in banks and other institutions. However, the power of the decentralized system is relatively decentralized, and “everyone has the opportunity to be in power”.
This chain of thousands of “blocks” records the information of capital flow in the past, which is consistent with some functions of banks in reality.
About every 10 minutes, a new bill (new block) will be generated in the bitcoin network, which will be hung at the end of the public ledger (blockchain) and broadcast to all users in the network, so that assets can be allocated publicly and “everyone can supervise”.
Due to the lack of accounting personnel, accounting work will be handed over to all users. But we can’t let everyone operate the books at the same time, because it will lead to chaos.
To this end, the system through the program mechanism (sha256 algorithm), limits the number of bookkeepers, to ensure that each time period, only a very small number of users can operate the ledger.
What each mining node (miner) has to do is to seize the bookkeeping right. Those nodes that have successfully obtained the bookkeeping right will get rewards from the system.
Thus, the unorganized group members spontaneously participate in the open bookkeeping activities, maintain the normal operation of the decentralized system, in order to obtain economic incentives. This incentive is bitcoin.
In order to seize the bookkeeping right, the miner needs to find a random number and solve the sha256 algorithm. However, the process needs to complete massive computing, which consumes a lot of computing power.
At present, it will take hundreds of years for a miner to untie sha256 and dig out a new block. In this way, the speed of bookkeeping is limited and the chaotic situation of “ten thousand people bookkeeping at the same time” is prevented.
But it’s also inconvenient for miners. If you want to dig out bitcoin, there is only one way: to join the mine pool.
Generally speaking, the mine pool connects thousands of nodes (mining machines) through a special protocol, which cuts the huge amount of calculation and distributes it to each node to integrate the computing power of mining machines in the mine pool.
In the distribution of income, it is determined according to the calculation share of each node, and each miner gets a different amount of “dividend”. In this regard, there are PPLNs, PPS, PPS + and other distribution methods.
It is worth noting that the concentration of bitcoin pools is strengthening.
From the data of 2020, f2pool, pool BTC.com The average annual calculation share of the four ore pools is 17.53%, 14.81%, 12.30% and 10.97% respectively, accounting for 55.61% in total. And the three Huobi.pool As of the end of the year, the calculation power shares of the three pools were about 9.39%, 3.57% and 11.48% respectively.
The concentration of computing power of Ethereum mine pool is higher. The average annual computing power share of sparkpool, ethermine and f2pool is 75.51%, and the average annual computing power share of sparkpool is 32.69%.
The whole network computing power of the two mainstream currencies is also rising, and the growth of Ethereum computing power is even far higher than that of bitcoin.
In 2020, bitcoin’s total network computing power rose from 112.93 eh / s at the beginning of the year to 153.48 eh / s at the end of the year, with an annual increase of about 35.91%.
The total network computing power of Ethereum increased from 141.55 Th / s at the beginning of the year to 281.37 Th / s at the end of the year, with an annual increase of 98.78%, about 2.75 times that of bitcoin.
The reason why the increase of computing power of Ethereum exceeds that of bitcoin may be that the mining cost of the former is lower. Due to the design mechanism, Ethereum has the ability of “anti ASIC”. Only through the graphics card of personal computer, it can mine. In terms of mining machine prices, Ethereum is also lower than bitcoin. In this way, the new and old players are easier to put into production, and the graphics card has been snapped up by Ethereum miners.
The gambler’s gambling nature and the miner’s longevity
“The people in the mixed mining circle and the mixed currency circle are very different. The ideas of these two schools conflict. Mining is actually fixed investment. It can be said that those old miners have faith, and they believe deeply in mining. ” Wang Feng thinks.
Wang Feng revealed that according to the data of tens of thousands of mining machine customers of Mars cloud mine, the repurchase rate of old miners is more than 90%, and some even repurchase three or four times in a few months.
Li Wen believes that the biggest difference between mining and secondary market speculation in the currency circle is that the income is more stable, the risk is lower, the cognitive threshold is much lower, and there is no need to understand complex concepts such as K-line chart.
“It’s easy to calculate the input and output of a mining machine,” Li said. The economic life of a mining machine is about four years. During this period, it can continue to output until the price of the money dug out can’t cover the electricity bill due to the backward computing power.
Miners need to consider, mainly back to the current cycle, future earnings and return on investment. Shang Silin compares this to “buying money at 30% or 40% discount, but the money has to come to the account slowly.”.
And Peter believes that mining can help people overcome gambling.
People who speculate in the secondary market simply buy and sell at different prices, and earn the price difference by doing long and short.
Because of this, the sentiment of speculators is easily affected by price fluctuations, and it is difficult to hold money for a long time. The output of mining is stable, and there are real benefits every day.
“Mining can be regarded as a fixed investment. Speculators often like to leverage and play futures, and often lose money.” Peter is joking. Since he came into contact with the currency circle and the mining circle, he has insisted on not playing leverage and always winning steadily. His attitude towards the currency market is that in the long run, the price of the currency will rise.
However, investment in mining machinery is not foolproof. Li Wen believes that there is a bubble in the currency market today. If the currency price is not good, it will fall one day and the timing is not good.
Li Wen almost stepped on the pit.
In 2017, Li Wen planned to work with friends to form a crowdfunding group to buy ant mining machines.
At that time, the unit price of ant mining machine was about 20000 to 30000 yuan. However, bitcontinental requires that the total amount of an order should not be less than 5 million yuan.
If you really want to buy a group, Li Wen has to bet money. On second thoughts, he felt that the risk was too great and gave up.
However, Li Wen’s friends didn’t retreat. Some people borrowed money from credit cards and credits to buy mining machines. What’s more, they sold their houses directly and bought more than 100 mining machines.
It was a bull market for bitcoin, and there were not a few such crazy people.
But in 2018, with the arrival of the bear market of bitcoin, the price of bitcoin fell by 60% or 70% for a time, and the mining circle and even the mining machinery market were affected, “a howl”.
The value of bitcoin produced by many mining machines can not cover the cost of power consumption. Countless miners shut down mining machines, and many small and medium-sized mines are unable to maintain operation, so they have to resell mining machines for liquidation.
A year ago, no one wanted the equipment that was easily sold at a low price. Some mines even piled up abandoned mining machines into hills and sold them as scrap iron.
One of Li Wen’s friends, who bought mining machines at a high price and sold them at a low price, directly lost nearly 2 million yuan.
However, when the currency price fell below the “shutdown price”, there were still some miners who insisted on starting mining.
“Most of them are determined old miners. They have faith in bitcoin and blockchain, and they don’t care about the rise and fall of the currency price for a while,” Li Wen said. “Compared with the lowest point of the currency price in November 2018 of US $3200, and the highest point of us $58000 in February 2021, the assets of those who stick to it may have increased 18 times.”.
Wang Feng, on the other hand, said of the miners, “those who believe in mining especially believe it. If they don’t believe it, they won’t believe it.”
He said that the mining area is not particularly large, and the number of investors in the secondary market must be far less. And those who have faith in the miners, often very “devout.”.
The rise of defi shock wave
With the rapid rise of the recent defi (decentralized Finance) project, a new method called “liquidity mining” is booming.
“Liquidity mining” in the field of defi refers to the process of obtaining rewards by using defi products and depositing or lending specified cryptocurrency assets as required to provide liquidity for the fund pool.
Different from the traditional computing power mining, liquidity mining is closer to “money makes money”, and the income does not depend on computing power, but on the number of cryptocurrency assets invested by participants.
Many people who are not willing to “gamble” in the secondary market have focused on the field of defi, resulting in a large influx of hot money. By the beginning of March, the total lock in volume of the defi market had exceeded US $55 billion, up nearly four times from US $14 billion in early October last year.
When it comes to mining with defi, Wang Feng believes that projects like defi, which distribute income by asset pledge, will have some impact on the mining area.
The cost of using defi is far lower than that of mining machinery, which is undoubtedly more attractive to outsiders. Even many old miners are willing to participate in defi mining.
In this way, in the short term, defi may attract more novices into the game, making the traditional mining circle group a little “solidified”.
But at the same time, due to the fact that defi is more complex, involves more concepts and is more difficult to use, it can not cause obvious impact on the traditional ore circle at present.
In addition, defi is a decentralized financial system. In the long run, it is more inclusive and will inevitably attract a large number of users. In the end, bitcoin and other cryptocurrencies will be recognized by more people. When the price of bitcoin rises, new users will be attracted to the traditional mining area.
Therefore, the defi and the traditional ore circle will eventually be gradually integrated.
As for Ethereum and bitcoin, Wang Feng said that the former is like Android in the field of encryption assets. Many projects rely on Ethereum’s ecosystem and have great potential. Bitcoin may be more like gold in the field of crypto assets, and its position is unlikely to be shaken by other cryptocurrencies.
In addition, Wang Feng said that with more and more enterprises and institutions paying more attention to bitcoin and the growing influence of defi and Ethereum, encrypted assets have become a link in the world’s macroeconomic system.
“In the past, this field was a small circle game, and it was a small group of people who influenced the situation. In the future, encryption assets may be affected by the macro economy, and the prediction of it will be more and more difficult. However, one thing is certain that this field will have a significant impact on the social system around the world, just like the Internet technology in the past decade or so (Li Wen and Peter are pseudonyms) Morgan Stanley: it is estimated that the total electricity consumption of global digital currency mining will exceed that of Argentina in 2018 Unchbase: blockchain has received $1.3 billion investment in the first half of 2018 CB insights: smart investors bitcoin and blockchain investment analysis CB insights: US startups account for 55% of global bitcoin and blockchain investment transactions CB insights: financial giants are stepping up investment in bitcoin and blockchain CB Insights: in 2016, bitcoin and blockchain start-ups received a total investment of US $550 million. CrunchBase: in 2017, global ICO raised funds of US $4.9 billion
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