The domestic virtual currency "mining" industry has been in a state of stagnation, and the "hydropower plant" has actually been sold on Xianyu!

In addition to selling bank shares, what else can be sold on Xianyu? Recently, Cailianshe reporters noticed that on Xianyu’s second-hand transfer platform, there were a lot of transfer information about small hydropower plants and mining machines. The reporter found that most of this information was published in June. The locations of the hydropower plants for sale are mostly in the mountains of Sichuan, Guizhou and other places. The power generation capacity varies from a few hundred kilowatts to a few thousand kilowatts, and the price ranges from one million to tens of millions of yuan.

The fact that these small hydropower plants are on sale reflects the fact that the domestic virtual currency "mining" industry is staging a "great escape". Industry insiders revealed that these small hydropower plants were originally used for "mining", and the reporter also saw from the information released by some sellers that mining racks, mining machines and other essential mining supplies were also transferred at the same time as the hydropower plants.

Some industry insiders bluntly stated that the current domestic virtual currency "mining" industry is almost stagnant, which is why there are a large number of small hydropower plant transfer information on Xianyu. Due to increasingly strict supervision, even if there are hydropower resources, the actual mining farms that can start "mining" are almost extinct. Therefore, although there are many buyers leaving messages on Xianyu, there are only a few buyers who are really ready to take over.

Small hydropower plants are put online for sale but no one is willing to take them

When asked by a Cailian reporter why he wanted to transfer the hydropower plant, a seller of the Xianyu Hydropower Station admitted that it was because he had other development plans.

"There is a huge difference between China and the outside world. Domestic mining practitioners can either quit and find another way out, or go overseas." A person in the cryptocurrency circle said that the intensity of the regulatory crackdown this time exceeded the industry's expectations. Previously, people in the industry still had illusions about the use of waste electricity for "mining" in Sichuan and other places, but the reality was a wake-up call. The resolute attitude of the regulators also made the "miners" realize that "escape" is the only option.

The seller of a power plant on Xianyu, which was offered at a price of 950,000 yuan, told Cailianshe reporters that the small hydropower plant to be transferred had all the necessary formalities and was not within the scope of the cleanup. The small hydropower plant he transferred could still be used for virtual currency "mining" and could be put into operation as soon as it was accepted, but the specific transaction price still needed to be negotiated in person, as did other details.

It is worth noting that most of the items for sale marked by sellers of small hydropower plants are related to mining, and "complete formalities", "integrated into the national grid", "not within the scope of withdrawal", "can be started and operated after receiving" and other information are common promises of these power plant sellers. However, these statements have also been questioned by "spectators". In the comment area, many messages questioned that the hydropower station is very likely to be shut down due to its participation in virtual currency "mining", and some people even bluntly said that this is "going against the wind".

"It is highly unlikely that anyone will take over this kind of hydropower plant now." A "mining" practitioner told a reporter from Cailianshe that from the perspective of the country's policy level, the industry of "mining" through hydropower energy consumption has been stopped. Even if one enters the market at a low price, it is no longer possible to build "mines" in the country and start "mining". Making such an investment is tantamount to "wasting money."

Liu Changyong, director of the Blockchain Economic Research Center of Chongqing Technology and Business University, believes that the large number of small hydropower plants being transferred may be due to the sellers' concerns about the tightening of policies. At present, the regulatory intention to clean up the "mining" industry is clear. Even if it has not yet affected these hydropower plants, the industry has already clearly anticipated the tightening of policies in the future, so it is better to transfer as soon as possible to stop losses in time.

It is understood that all regions are cleaning up and rectifying power generation companies that illegally supply electricity to Bitcoin and other virtual currencies. The Yunnan Energy Bureau previously issued a document requiring the completion of the cleanup and rectification of Bitcoin mining companies by the end of June. Severely investigate and punish Bitcoin mining companies that rely on power generation companies, privately connect to electricity without permission, evade state power transmission and distribution fees, funds, and make additional profits. Once discovered, immediately suspend power supply; severely investigate and punish power generation companies that use the power generated without permission to privately supply electricity to Bitcoin mining companies for improper benefits; severely investigate and punish Bitcoin mining companies.

There is no room for overseas mining in the country

The country’s heavy-handed crackdown on the virtual currency mining industry has shattered the mining industry’s previous fantasy of using waste electricity from the flood season to “mine.”

At the end of May this year, the Financial Committee of the State Council clearly proposed to crack down on Bitcoin mining and trading. Since then, Inner Mongolia and many other places have issued notices to clean up and rectify virtual currency "mining" related industries. At that time, many "miners" were optimistic that using waste electricity in the flood season for "mining" would not cause power shortages and increase energy consumption, and would have no impact on the "dual carbon" goals. Even if mining is not allowed in some areas such as Inner Mongolia, it can be transferred to Sichuan and other places where there is more waste electricity and no restrictions for the time being.

However, the cleanup and rectification documents from Sichuan and other places came one after another, which made the "mining" practitioners realize the country's determination to clean up and rectify this industry. Some mines that "moved" from Inner Mongolia and other places overnight were shelved again before they could start running.

A person in the cryptocurrency circle told Cailianshe reporters that the current attitudes towards virtual currency "mining" at home and abroad can be described as "ice and fire". In countries and regions such as Kazakhstan, electricity is cheap and the government is relatively supportive, so many mining farms are now preparing to move. However, since a large number of machines "going overseas" require a long time for customs clearance, there are currently a large number of "mining farms" waiting in line in China to "go overseas".

"In theory, due to stricter domestic supervision, a large number of virtual currency mines have been closed, resulting in a decline in overall computing power. This means that if they can be started and run, the difficulty of mining will be much lower than before. Even though the value of currencies such as Bitcoin is lower now, the profit margin is still relatively high." The above-mentioned person told the Cailian reporter that from the current perspective, the profit margin of mining is still around 200%, so there are many people who choose to "go overseas" and continue to engage in "mining."

An industry insider also said that mining is essentially a form of digital asset production and manufacturing. Despite domestic policy suppression, North America and other countries have corresponding policy support, and electricity prices and various infrastructure are relatively mature. While the number and scale of domestic mines are declining, foreign mines will increase.

The price of mining machines and computing power has fallen to the bottom. The price has dropped by more than half in two months.

Under the heavy hammer of supervision, the domestic "mining" related industries have all experienced a rapid decline. It is understood that in the virtual currency industry chain, there are not only manufacturers of mining machines, mining farms that host mining machines, but also platforms that provide mining services.

"April and May this year were the highlight moments of the entire industry. At that time, our computing power prices were nearly three times higher than they are now, and the demand was still in short supply." Wang Dong, a young man born in the 1990s, told Cailianshe reporters that his previous company provided computing power for "miners", but now the server sales are very bleak, and even though the price has fallen to the bottom, no one is interested. "The entire industry is in a state of suspension and rest. Personally, I can only find another way out and quit this industry."

Wang Dong said that before the introduction of domestic regulatory policies, the high price of Bitcoin led to the rapid development of the mining industry. Only by continuously increasing computing power can mining farms "mine more coins" faster, so the price of mining computing power rose sharply at that time. Taking the computing power of 16G TB as an example, the price once rose to 6,000 yuan, but after the introduction of regulatory policies, the price of the same computing power quickly fell to less than 2,000 yuan.

Not only that, the price of mining machines has also shrunk significantly. An industry insider revealed that, taking the current mining machine S19 with better performance as an example, the unit price had been hyped up to 60,000 to 70,000 yuan per unit before the introduction of the regulatory policy, but now the price is less than 20,000 yuan. Some equipment with poor performance can only be sold as "scrap".

Liu Changyong said that after the crackdown on "mining" was released in various places, all kinds of mining farms, mining pools and other "mining" related industries were shut down. Although many mining farms chose to "go overseas", there were still a lot of equipment that could not be shipped out, and the number of sellers increased significantly. However, the overall expectation of stricter policies is still there, and there are fewer people to take over, so prices continue to fall.

The industry expects stricter policies as supervision becomes stricter

Liu Changyong said that, from the current perspective, the most direct reason why regulators crack down on virtual currency-related industries is environmental protection. However, preventing social risks brought about by virtual currency speculation, eliminating the impact of decentralized virtual currencies on foreign exchange controls, and vigorously promoting policy choices for autonomous and controllable industrial blockchains are also important reasons for strengthening supervision.

Under multiple risks, this round of supervision is more resolute and strict than any previous one. Many industry insiders said that China has set a trend of tightening supervision on industries related to virtual currencies, and it is expected that there will be stricter policies on all aspects of virtual currency speculation in the future. The entire domestic virtual currency mining and trading industry has no room for survival.

Since the beginning of this year, the intensity of regulatory containment of virtual currencies has been escalating. In addition to the major virtual currency "mining" areas in China, such as Inner Mongolia, Xinjiang, Yunnan and Sichuan, which have taken severe crackdown measures on "mining", the central bank has also interviewed many banks and payment institutions to cut off the payment link for transaction funds. In July, the Beijing Local Financial Regulatory Bureau directly shut down service providers suspected of providing software for virtual currency transactions, and at the same time prohibited relevant institutions from providing business premises, commercial displays, marketing and publicity, paid diversion and other services for virtual currency-related business activities.

The regulatory crackdown on virtual currencies has also made many blockchain technology companies focus more on breakthroughs in the technology field. A blockchain industry insider told Cailianshe reporters that previously blockchain technology companies often obtained extra income by issuing tokens or participating in currency speculation, but now they need to focus more on the development of real blockchain technology. This has also forced some blockchain companies that only deal in virtual currencies to "close down" and exit.

"The development of blockchain technology will be more or less affected by regulatory policies. In terms of the difficulty of technology research and development and the scalability of scenarios, the prospects of public chain technology far exceed those of alliance chain and private chain. A blockchain industry insider said that as the underlying technology of virtual currency, blockchain is still very promising. But it is still in its early stages of development. If it is only used for currency speculation, it means that the information carried on the chain is only used for speculation, and blockchain technology is being used inappropriately, which is not conducive to the overall development of blockchain. Blockchain technology needs to find truly valuable scenarios to bring out its potential advantages. (Cailianshe)