Wang Wenguang, head of BitDeer Data Center: The trend of mining overseas is irreversible, and domestic computing power will drop significantly

On April 21, the "Second BitDeer 421 Flood Festival and Mining Ecology Conference" was held in Beijing, hosted by "BitDeer Group" and "BlockBeats", and co-organized by major brands such as BitDeer, Mining++, BTC.com, and MatrixPort.

During the conference, BlockBeats interviewed Wang Wenguang, the head of the data center. He emphasized that the future of mining lies overseas, and that the proportion of domestic computing power will drop to 50% or even below after this round of bull market. At the same time, BitDeer has already laid out overseas mining and can help the majority of miners to go overseas.

Wang Wenguang, head of BitDeer Data Center

The following is a summary of the conversation between BlockBeats and Wang Wenguang:

BlockBeats: Last time you were interviewed as the head of a mining farm, and this time you have become the head of a data center. Has your job content changed compared to before?

Wang Wenguang: This is because BitDeer Group is upgrading our entire mining industry services. We are actually following the current trend of mining formalization and shifting mining services to data centers. At the same time, we also hope that the industry will move in the direction of data centers, so we named it "data center". The specific work content is actually similar to before, and we still provide services such as mining site search, design, construction, mining machine operation and maintenance.

BlockBeats: This year, a security inspection in a certain region in China caused a sharp drop in the computing power of the entire Bitcoin network. Domestic computing power still accounts for a large share. In a previous interview, you said that "the future of mining lies overseas." Has your view changed now?

Wang Wenguang: When I said this, I actually made that judgment based on the general trend of this bull market. In recent times, some regions have shut down all mining companies for various reasons, which further verifies our previous judgment that the future of mining is overseas.

This time the computing power plummeted, and we can see that many people in China are very panicked. After this bull market, the computing power distribution will change more significantly, and overseas may account for more than 50%, while domestic computing power will become less and less. Now domestic computing power accounts for about 70%. After this round of bull market, the ratio of domestic and foreign computing power is about 50:50, which is an irreversible process.

BlockBeats: Are Chinese miners moving abroad, or are the number of overseas miners increasing?

Wang Wenguang: It’s a bit of both. Recent events are prompting domestic miners to move abroad, and large companies need a stable environment for long-term development.

At the same time, many overseas listed mining companies are desperately buying mining machines. According to the recent sales volume of mining machine manufacturers, overseas mining machine shipments account for 70%-80%.

BlockBeats: If mining is compliant, will the cost of mining increase?

Wang Wenguang: Direct costs will definitely increase, there is no doubt about that. A major prerequisite for compliance is that the costs that should be paid must be paid, such as upgrading mine facilities, such as tax filing, etc., which will increase costs.

But looking back, I believe the overall cost of mining will decrease or remain unchanged. After compliance, things like mine closures will not occur, which would be equivalent to all mining investments being wiped out, and the loss of such an investment is difficult to calculate.

Rhythm BlockBeats: How long does it take to get out?

Wang Wenguang: It is not possible to go global all at once. Enterprises need to bear the costs and take over the resources. In the short term, it is impossible to go global on a large scale in one or two months.

BlockBeats: You mentioned compliance just now. The secondary market of Bitcoin is actually also moving towards compliance. Do you think it is the secondary market that drives the compliance of the primary market, or vice versa?

Wang Wenguang: I don’t separate mining and buying coins. If I make a distinction, I think the primary market is leading the compliance.

The internal reason is that miners’ personal assets need security, and high-net-worth assets need to be protected in compliance. The external reason is domestic policies, such as the “carbon neutrality” policy, and non-compliance will lead to elimination.

BlockBeats: Since the trend of mining going overseas is irreversible, will domestic mining disappear?

Wang Wenguang: Of course not. The trend is to go overseas, but it will not disappear in China and will coexist for a long time. Just like mining has evolved from stealing electricity in the early days to directly supplying electricity to the current park grid. This trend is very obvious, but the early power supply method still exists.

BlockBeats: Will mining accidents happen again?

Wang Wenguang: I think there will be. Since it is an investment product, fluctuations are inevitable. Some models will be shut down after a correction. I think many people agree with this.

BlockBeats: Is the bull market trend over?

Wang Wenguang: I can clearly say that the bull market is not over. On the one hand, at the peak of the last bull market, Bitcoin’s market capitalization accounted for less than 40%, and now it is 52%. Many coins have not risen. On the other hand, many institutions have entered the market in this bull market, and they are very rational, so this bull market will be prolonged.

I think the peak of this bull market may be in the second or third quarter of this year, or maybe in October, because September and October are the transition period between good and bad seasons, and prices have always fluctuated during this period.

BlockBeats: In this bull market, what scale might the global mining industry reach?

Wang Wenguang: Excluding unexpected situations, the global computing power at the peak of the bull market should be about 20% higher than at the beginning of this month.

BlockBeats: In what time period will it happen?

Wang Wenguang: During this flood season, this number may be a bit conservative.

BlockBeats: You said in a previous interview that BitDeer can help domestic mining companies go global and mine overseas. How does the cooperation work specifically?

Wang Wenguang: It is an inevitable trend for domestic miners to go abroad, but going abroad is not scary. We can refer to how traditional enterprises went abroad in the past. I think the most effective, direct and lowest-cost way is to borrow a boat or take a boat to go to sea.

BitDeer started planning overseas mining in 2016. We can say that we were the first domestic mine or miner to plan overseas, and we are still doing so today. Our current overseas scale is also one of the best. We already have 300 megawatts of overseas mines.

We really want to help domestic miners who want to go abroad. Our mines in Texas and Norway are open to investors. If domestic miners want to hold overseas loads or want to participate in mining equity cooperation, they can contact [email protected].