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Mining Giants Competition

06/06/2019
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  • Mining
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Redistribution of spheres of influence is quite possible in the market of mining equipment manufacturers. A clear industry leader, Bitmain, has some financial problems. At the same time, MicroBT, which is now ranked third, is actively promoting more efficient ASICs with reduced energy consumption.

Samsung and MicroBT Collaboration

At a conference in Chengdu (China), a Samsung representative announced a new development. Since last year, mining chips are under development, and now the production of a completely unique product has begun. Chips with technical process of 3 and 5 nm will fundamentally improve ASICs energy efficiency.

WhatsMiner M20S, the new miner, has an efficiency of 48 W/TeraHash and a performance of 68 TeraHash/s. It allows obtaining cryptocurrency five times faster and two times cheaper compared to similar cost devices by Bitmain.

MicroBT was founded in 2016 by Yang Zuoxing (from Bitmain). From the very beginning, he set the task of developing equipment with maximum efficiency. Precisely this approach will allow his business in just two years to reach the third place in the industry.

Problems of the Mining Sphere Leader

At the same time, Bitmain’s business is far from ideal. Despite the dominant position in the market, at the end of 2018, rumors about financial problems began to appear. According to experts, the second half of the year brought it losses for $ 500 million. However, the company itself called this figure too high.

In September 2018, Bitmain filed an application for shares placement on the Hong Kong Stock Exchange. However, its registration has expired on March 26. Investors were upset over the situation on cryptocurrency markets and showed no interest in the company's shares.

In the winter 2019, the company was attacked by investors who wanted to return the money invested. Then the case touched on the amount of $ 800 million, which were invested in the early stages of development. However, the rise in bitcoin price allowed the conflict to be resolved.

Crypto Winter Ends. What's Next?

According to some experts, Bitmain was saved by the crypto spring. The rise in bitcoins price allowed alleviating the problem, but the leader position was not so good until the end. A significant share of the company's profits come from their own farms. In the winter 2019, it was reported that the company plans to deploy 200,000 devices in regions with low-cost electricity.

In May, it became known that Bitmain computing power was reduced by 88%. The reason is the termination of the use of 130,000 AntMiner S9 ASICs. Probably, this equipment’s profitability does not allow receiving stable income even at the current cryptocurrency price.

Against the background of industry leader’s problems, the situation in MicroBT seems more positive. Here they immediately began to rely not on the mass character, but on the high profitability of cryptocurrency mining. And that gives positive results. Collaboration with Samsung, the world's second chipmaker, was another step in achieving this goal. While Bitmain Antminer 17 series, the newest of the ASIC miners, is built based on 7 nm chip, MicroBT creates its product with chips of 3 and 5 nm.

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