China’s recent ban on crypto mining has caused an overflow of miners and a global race to relocate tons of powerful machines that are used to solve complex puzzles and earn Bitcoin.
Fourteen of the biggest crypto mining companies have moved around 2 million machines out of China in the months following China’s ban. This is according to data that was gathered by the Financial Times.
The huge share of banned machines has been moved to the US, Canada and Kazakhstan and Russia. One of the largest crypto mining companies listed in the US, Bit Digital, has hired an international logistics firm to extract its remaining property from China. The firm is still waiting for a batch of around 1000 machines to be released from the docks at the Port of New York.
Sam Tabar, Chief Strategy Officer of Bit Digital has said, “We started our fleet migration in March 2020, which in hindsight was a great move. When the ban was announced we had 20,000 miners in China.” The company still had to abandon 372 machines in China which have reportedly reached the end of their lives.
8 in 10 of the largest public mega-farms based in North America have expanded the number of machines in their fleets since China’s ban.
When the ban initially hit, Toronto-based crypto mining company Hut8 was bombarded with offers from panicked Chinese sellers. This is according to Sue Ennis, Vice President of Hut8’s corporate development and investor relations.
Ennis said, “We were getting calls from providers which were pretty opaque and one-sided,” adding, “They would ask us to pay $20m with no recourse if it does not arrive or arrives broken.” Hut8 added 24,000 machines in June from the Chinese company MicroBT.
The frenzied liquidations caused by China’s ban caused the price of popular mining machines to fall by around 41.7 percent from May to July. Chinese crypto mining machine manufacturer Bitmain, the maker of the s19 model, sold 30,000 machines to Marathon Digital Holdings, a mining company based in Las Vegas.
The company later announced that it was suspending machine sales to help the industry transition slowly and reduce the great pressure on the market.
