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Over the past month, the bosses selling graphics cards and mining machines in Shenzhen's Huaqiangbei have been experiencing a continuous impact like a summer rainstorm.
A month ago, the virtual currency mining industry was still "YYDS" (Internet slang, meaning "eternal god") in the minds of workers; a month later, the situation in the cryptocurrency market took a sharp turn for the worse.
On May 18, the Internet Finance Association of China, the China Banking Association, and the Payment and Clearing Association of China jointly issued the "Announcement on Preventing the Risks of Virtual Currency Transaction Speculation", which fired the first shot in the comprehensive regulation of virtual currency.
On the 21st of the same month, the Financial Stability and Development Committee of the State Council clearly proposed to crack down on Bitcoin mining and trading. In the following month, virtual currency mining projects encountered strict supervision at the national level, and local regulatory authorities took strong measures. Inner Mongolia, Qinghai, Sichuan, Xinjiang, and Yunnan all "drew their swords" and started the work of clearing virtual currency mining projects.
Against this backdrop, the bosses at Shenzhen Huaqiangbei Electronics Market, who had declared a month ago that “forget about graphics card price cuts,” can now only think about how to sell their mining equipment every day.
The bubble myth of earning millions a year by selling graphics cards and mining machines in Huaqiangbei has been shattered.
"Mining" becomes high-risk In just one month, the area selling mining equipment in Shenzhen Huaqiangbei has become noticeably deserted.
On June 29, a reporter from the Times Weekly visited the mining equipment concentration area in Huaqiangbei and found that the scene of couriers dragging trucks full of graphics cards and mining machines into elevators in the past is now basically gone. Most of the stall owners are playing with their mobile phones out of boredom.
Behind them are small hills of various graphics cards. In Shenzhen Huaqiang North Electronics Market, popular graphics cards are piled up like small mountains in the store. (Photo source: Photo taken by a reporter from Time Weekly) A boss loudly warned his employees at the counter not to add the words "mining machine or graphics card" to any transfer or payment. "Brother, you have to pay attention! If you don't make this note carefully, the money in my card might be 'frozen'."
A month ago, most of the best stalls in Shenzhen Huaqiangbei had the word "mining" on their signs. But now, the word "mining" is dangerous: in their eyes, even using the word "mining" when transferring money is considered a high-risk behavior.
Being at the center of the storm, the bosses in Huaqiangbei have become particularly sensitive.
On June 21, the People's Bank of China summoned several banks and institutions, including the Industrial and Commercial Bank of China, the Agricultural Bank of China, the Construction Bank of China, the Postal Savings Bank of China, the Industrial Bank of China, and Alipay, a subsidiary of Ant Group, to discuss the issue of providing services for virtual currency trading speculation. On the same day, the summoned banks and Alipay announced a ban on providing services for virtual currency trading.
Under comprehensive and strong regulatory governance, the bosses who resell graphics cards and mining machines in Huaqiangbei now most desire to sell off their previously accumulated graphics cards, hard drives and mining machines.
Whenever the Times Weekly reporter asked about the price of graphics cards, the small business owners responded with joy: "Sell, sell, sell. All in stock. What model do you want?" At the entrance of a store selling mining machines and graphics cards in Huaqiangbei, Shenzhen, all popular models are marked as in stock. (Photo source: Photo taken by a reporter from Times Weekly)
In stark contrast to the past when cards were hard to come by, Huaqiangbei now not only has sufficient stock, but many stalls are even clearing out their stock at "floor prices."
Graphics cards that were once in short supply are now a thing of the past.
Take Nvidia, known as the "Hermes of the graphics card industry", for example. The brand's newly released GeForce RTX 3070 Ti, released in June, can now be bought on the spot at a pleasant price - a month ago, the old version of RTX 3070 was priced at 10,000 yuan. In contrast, the new version of RTX 3070 Ti is priced at 40% off.
Another RTX 3080 with slightly higher configuration currently has an average price of about 9,500 yuan. A month ago, this model was once hyped up to about 16,000 yuan, and it took more than half a month to pick it up.
In Shenzhen Huaqiangbei, a shop owner with the word "mining" in his name gives a quote for popular graphics cards. (Photo source: Photo taken by a reporter from Times Weekly)
In stark contrast to the bosses who were eager to sell their products, game enthusiasts who were buying graphics cards were very calm.
A game enthusiast said in an interview with the Times Weekly reporter: "When the seller breaks his word, the transaction becomes just a game between 'gamblers'. Who knows if the graphics card you bought has been used for mining? Now some small factories do a good job of dust removal and packaging, and the products look like new ones."
According to the game enthusiast, the PC gaming industry has been relatively quiet recently, and there is no rigid demand to upgrade graphics cards. Most people who did not buy graphics cards before are also waiting for the next-generation 40 series graphics cards to be released. "Under the current situation, anyone who buys is a fool."
A stall owner in Huaqiangbei told the Times Weekly reporter that his business has reached a dead end. The market is flooded with spot goods, and many bosses he knows are in a hurry to sell, and many people may have to bear the consequences of losing all their money.
The mining machine bosses who once enjoyed great success may now have to think about a question: should they hold on to their positions or withdraw from the arena?
“It is never too late to turn back”
The stall owners who are busy selling graphics cards may have to continue staying in Huaqiangbei. The many small vendors who previously believed in virtual currency and mined part-time have long disappeared.
A month ago, Wang Dan (pseudonym), a senior miner and graphics card businessman, was interviewed by a reporter from Time Weekly when the cryptocurrency circle was in a state of panic. At that time, he also said that he was used to the "big winds and waves" in the cryptocurrency circle and had to face it calmly.
But now, Wang Dan said that he is no longer in Shenzhen. "I have moved. In the past month, I have broken down the mining equipment into small pieces and shipped them out of Shenzhen in batches and returned to my hometown." Wang Dan's WeChat Moments location shows that his hometown is in Heilongjiang.
According to several bosses who are currently staying in Huaqiangbei, several large mines previously located in Xinjiang have moved abroad.
An unnamed boss told the Times Weekly reporter that under the current high-pressure supervision, some mining organizations he knows have split into small workshops. According to him, the size of such small workshops is generally maintained at less than 10 machines (80 graphics cards), and at the same time, the bank statements of these workshops are also split into small amounts of tens of thousands of yuan for transfer.
"I don't dare to dig anymore. I have turned back. Nowadays, clearance sales are the only way to survive! Friend, I can sell the model you asked about just now at a lower price. Would you consider taking one away?" the boss asked anxiously.
Xia Yige (pseudonym), who sells chips in the computer parts area of Huaqiangbei, said: "Currently, the chip prices in Huaqiangbei have entered a sideways period. There is a price but no goods, which is very similar to the previous trend of graphics card prices."
Unlike last year's laughter and joy, at a time when the prices of electronic parts and components have already gone through a round of crazy increases, the mentality of the owners of the stalls in Huaqiangbei has changed a lot. They no longer hope that the prices of the electronic parts and components they stockpile will continue to soar. After all, the cost of stockpiling is getting higher and higher. If they encounter similar incidents as the mining equipment, they will be waiting for the same storm.
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