Mining market recovers! New Bitcoin miner demand once again outstrips supply

Bitcoin’s ongoing bull run has fueled demand for new mining hardware, forcing manufacturers to produce enough machines to satisfy buyers.

The world’s largest cryptocurrency by market value is currently trading above $11,000 after breaking through $10,000 – a gain of nearly 200% since February.

“The surge in bitcoin prices has led to increased demand and supply is already in short supply,” said Steven Mosher, head of global sales and marketing at Canaan Creative, maker of the Avalon Miner.

While Mosher declined to disclose the company’s order volume, he said in an email that “the industry is currently in a state of declining inventories and high demand. ”

“This looks like a return to the third and fourth quarters of 2017, when demand was three times the supply. ”

At the time, the price of Bitcoin doubled between July and September 2017 and rose another 4 times in the final quarter to nearly $20,000.

The price increases of the past few months have also led to a significant reduction in the time it takes for new mining machines to pay back, according to data provided by TokenInsight, a crypto startup focused on mining and trading research.

The firm estimates that the average payback period for most mining equipment has fallen to 60 to 150 days in the second quarter, down from a previous range of 120 to 280 days.

New mining machine models

To seize new opportunities, last month Canaan launched a new mining machine - AvalonMiner 1041, which claims to have a computing power of up to 37 Th/s and a power consumption of 2,361 watts per hour.

By comparison, the older model Avalon 851 computes at about 14.5 Th/s and consumes 1,450 watts per hour.

Mosher added that due to the overwhelming volume of orders, pre-orders for such models have been booked for delivery through October.

Likewise, Bitmain also launched improved versions of its AntMiner S9 models last week, called AntMiner S9 SE and S9k. The first shipments are not expected until August.

Even more expensive and powerful products have emerged, such as the WhatsMiner M20 launched by former Bitmain chip design director Yang Guoxing, and miners' purchasing interest is rising.

Yang told us that the next batch of M20 phones, due to ship in late October, are currently "almost sold out."

But Yang added that another important reason why the industry's supply had difficulty catching up with demand was production capacity, as manufacturers initially had limited chip supplies.

“The growth of Bitcoin’s computing power cannot keep up with the pace of price increases, ” Yang said. “The production capacity is the bottleneck. ”

Computing power improvement

In fact, the resurgence in mining interest is also reflected in the total computing power dedicated to securing the Bitcoin network, which recently reached an all-time high.

BTC.com’s latest one-day and seven-day average hash rates are 65 million and 58 million TH/s, respectively.

The network’s hash rate has jumped about 80% since the end of last year, when the 14-day average bitcoin mining hash rate fell to 36 million TH /s as bitcoin prices fell.

Assuming all this new hashrate comes from commonly used mining machines, such as the AntMiner S9 or Avalon 851, with an average hashrate of about 14 TH /s , this means that about 2 million mining machines have been started up in the past few months.

Therefore, BTC.com estimates that Bitcoin mining difficulty will further increase by 6% to an all-time high of over 7.8 trillion at the start of the next adjustment cycle.