Amid free-fall of crypto Markets in last two weeks, Chinese
Amid free-fall of crypto Markets in last two weeks, Chinese miners are reportedly selling off their mining rigs in kilos, instead of selling at a slashed price as generally observed. The weird discovery came to light when 8BTC, a crypto news portal reported about the same. It is being said that miners don’t see the crypto mining market as a profitable domain, the falling prices exceed the cost incurred by miners regarding electricity and other maintenance charges.
Crypto World has experienced Bear effect in last week and a half, where major cryptocurrencies lost more than 20% in market capitalization. For example, BTC which was expecting the bulls to help it breach the $6,500 to $7,000 mark ten days ago, is currently trading under $4,300. Similarly, many other coins fell significantly and crypto trade market lost around $45 Billion.
The price drop has directly affected the compensation and mining profitability, which has forced many Miners to sell off their expensive Mining rigs at throwaway prices. To give you a perspective, miners who bought mining rigs at $2,200 a year ago, are selling it for a cost of around $144. The news got so much attention for the fact that, miners are ready to sell their expensive rigs ‘in kilos.’
Small & Medium Sized Mining Operations Bear the Brunt
The downfall and cease in mining operations have mainly affected the small and medium-sized mining operators, primarily concentrated in the regions of Xinjiang and Inner Mongolia. As per the reports, miners are eager to sell their rigs at 5% of their actual valuation. A mining rig bought at 20,000 yuan last year has been sold for a mere 1,000 yuan.
Among the most sold rigs, Antminer S7, Antminer T9, and Avalon A741 top the list as they have got older and miners believe they have reached their “shutdown price,” which means, the cost of input and maintenance is way more than what miners gain from it.
The recent slump in the market has been attributed to many factors. However, the bitcoin Cash Fork War is still considered to be the main culprit by many. The November 15 Hard Fork led to the seizure and temporary banning of trade for BCH until the Hard Fork commences, which led to a series of selling spree among the investors.
In September, CEO of F2Pool suggested that mining would only be profitable from Antminer T9 if the prices of bitcoin do not fall below the resistance mark of $5,376. Anything below that would amount to losses for miners.