Bitmain Technologies Ltd., one of the industry’s largest Bitcoin mining machine manufacturers, has suspended sales of Bitcoin mining machinery just days after China’s crackdown on the Bitcoin mining industry, per Bloomberg.
Bitmain said yesterday that it has paused selling new equipment following a 75% price drop on mining machinery. A confluence of different factors has reportedly led to this shift. Colin Wu, a crypto journalist in China, has reported that as miners shut down their machines, they are also selling those used machines second-hand, which is also impacting Bitmain’s sales.
Bitmain halts sales of crypto mining rigs after prices plummet from a flood of used machines hitting the market, the result of China's crackdown https://t.co/p6doVcmzPg via @crypto
— Bloomberg Crypto (@crypto) June 23, 2021
It is believed that postponing sales of mining equipment could help miners generate better sales for their machinery as they try to exit the industry.
This is the latest in a long line of blows to the Bitcoin mining industry—which has recently faced a giant challenge in China.
Bitcoin mining and China
In the last week, China’s Bitcoin miners have been told to discontinue their operations.
On July 18, Sichuan energy companies were told to stop providing energy to the province’s miners, signaling a blow to the industry similar to what has already been seen in other parts of China, including Inner Mongolia, and Xinjiang.
Bitcoin mining demands an immense amount of energy, and governments and individuals alike are concerned about the industry’s impact on the environment. However, given that China controls approximately two-thirds of the entire world’s mining, the government’s crackdown represents the most immediate threat to Bitcoin’s miners today.
In any case, the crackdown on mining is perhaps not surprising, given China’s commitment to carbon neutrality. And while China wrestles with the mining industry, there is a belief that other countries might stand to benefit.
Kazakhstan might be one of those countries after Chinese mining firm Bit Mining announced it had delivered its first batch of mining equipment to the country in reaction to China’s ban.
Bitcoin mining has also picked up steam in the United States—although the industry has not managed to escape controversy surrounding the environment. Elsewhere in China, the government has targeted crypto activities more broadly. The People’s Bank of China, the country’s central bank, told financial institutions to cease crypto activity.