Around May 11, the third reduction in Bitcoin will come as scheduled.
At that time, the Bitcoin block reward will be reduced from the current 12.5 / block to 6.25 / block , and the fate of a large number of old miners will also be rewritten accordingly. They used to be Bitcoin's security shield and source of value, and since then, waiting for them will be electrical decomposers and garbage collection stations.
Many miners holding a large number of old mining machines, in the face of the increasing difficulty of mining and the difficulty of obtaining a 7nm mining machine, have pinned their hopes on the increase in currency prices due to reduced production and the "Yungui River" flood season in May. Bring cheap electricity.
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So, what is the status quo of the previous generation of 16nm miners? Can the so-called "reduced bull market" come on schedule? Will the distant water during the "rich water period" save the near-fire of the 16nm mining machine? How should the old miners plan to minimize this disaster from God's perspective?
1. Current status of 16nm mining machines: strong enemy
According to the latest data from f2pool, as of March 3, 2020, based on the output of electricity of 0.38 yuan / degree and 0.0001624 BTC / T / day, Shenma mining machine M3, Avalon mining machine A741, wing bit mining machine E9 +, Antminer T9 + and other mining machines using 16nm chip process have reached the shutdown price.
Around the 16nm mining machine team, only the Bitmain S9 series is struggling to support, and the overall mining electricity cost has reached 92%. The weapon that once relied on mining is about to withdraw from the stage of history and be tragic.
Generation machine ant s9
And the most serious thing doesn't stop there.
According to a survey conducted by the third-party evaluation agency TokenInsight at the end of 2019, a total of 43 mining machines under the five mining giants of Bitmain, Jianan Yunzhi, Shenma, Yibit, and Core Motion Technology were operated and sold throughout the network According to the investigation, it was found that under the mining difficulty at that time, there were more than 25 mining machines with a return period of more than 700 days.
If the life of the Asic miner is 18 months (540 days), close to 58% of the miners will not be able to recover the cost. These 25 types of miners are all 16nm process miners.
With the rapid delivery of new mining machines, the situation of old mining machines will become more serious.
Since the beginning of 2019, with the fast delivery of orders for 7nm and 8nm chip high-performance mining machines, the computing power and difficulty of the entire network have increased significantly, reaching historical highs of 123EH / s and 15.3T, respectively. Since the beginning of 2019, the SHA256 mining power of the entire network has increased from around 55EH / s to 123EH / s, an increase of 123%. The difficulty of mining rose by 23%, reaching the highest level in history.
These newly delivered mining machines include Bitmain's ants S15, S17, T17, and S19 (all using 7nm chips), Shenma mining machine M20 (using Samsung 8nm chips), and Avalon's A10 and A11 (using 7nm chips ).
At the same time, the advent of more powerful 5nm chips has intensified this competitive landscape.
In December 2019, Bitmain's 5nm test chip was successfully returned. Bitmain became the world's first company to complete the packaging of 5nm test-grade chips. Mining machines equipped with this type of chip will also be available in the first half of 2020. Jia Nan is also closely following TSMC's 5nm process, and Avalon Sales Director Chen Feng said that he also said that the stronger 5nm miner is also on the way.
The old generation of mining machines can be described as powerful enemies.
"40% is estimated."
When asked about the proportion of 7nm / 8nm chips with high performance and new computing power, the founder of Leibite mining pool Jiang Zhuoer told the OKEx Intelligence Bureau.
Exponentially increasing Bitcoin network hashrate
In other words, it only took more than a year for the new generation of mining machines to account for the computing power from 0 to 40%. As the domestic epidemic situation is gradually controlled and mining machine manufacturers resume work normally, 7nm mining machines will be delivered quickly, and the network's computing power and mining difficulty will be pushed up again. By then, the profit margin of the 16nm mining machine will also be squeezed further.
Contrary to the unsatisfactory profitability of old mining machines, the performance of the new generation of mining machines can be described as dazzling. Take Ant S17 + as an example. The shortest payback period is 230 days.
At the moment when the difficulty of mining continues to increase, the representative of the 16nm mining machine era is still a part of the main "one generation machine emperor" of the mine. At its peak, the ant mining machine S9, which accounted for 60% of BTC's network computing power, will sometime in the future Say goodbye to dominating the mining circle stage for 3 years?
For the small miners who still use low-power mining machines to mine, is it really going to be eliminated by the market?
2After the production reduction, is it almost inevitable that 16nm miners will be eliminated?
Bitcoin block rewards will be reduced from the current 12.5 to 6.25, which is not good news for miners.
With the help of strong enemies, will the reduction in production lead to the elimination of the only 16nm miners on the market?
"The halving itself is to reduce inflation, but for miners, halving is a double-edged sword. The halving in May coincides with the replacement of new and old mining machines, and 16nm mining machines are facing shutdown. At present, the entire Bitcoin network has about 110E. Power, about 40% of which are mining machines belonging to the S9 era. With the end of the first water harvest period after halving, this batch of mining machines will basically enter its final stage. Miners need to make layouts in advance and manage well. Your own risk. "
Yuchi COO Big Fish recently said in an online salon hosted by Deep Chain Finance.
Godfish, co-founder of Yuchi and Cobo Wallet, said:
"Having Bitcoin halved is a fatal blow to existing miners, and the revenue has been halved directly. If the currency price does not fluctuate sharply at this juncture, it may lead to the fact that current miners, which account for about 50% of electricity bills, are not able Mining, because its marginal benefit is less than its marginal cost, it can only choose to shut down. "
Godfish also believes:
"At the same time, this time is exactly the time when the 16nm mining machine is upgraded to the 7 / 8nm mining machine, which has exacerbated the risk of the previous generation of mining machinery. Preliminary estimates are that it will be halved at the beginning of May 2020. Up, currently the mining machine represented by S9 at 30-40E has to shut down, the computing power of the whole network will drop, and the cycle of mining machine return will become longer. "
In other words, under the circumstances of the 7nm mining machine, bitcoin production reduction is only to accelerate the elimination process of the 16nm mining machine. And if the future currency price performance is not good, it will inevitably make the situation of 16nm mining machines worse.
After the cut, what will happen to the price of Bitcoin? The future is unknown. Looking back at history, we may find some clues.
The first time for Bitcoin to reduce production was November 28, 2012. At that time, the computing power of the entire network was 27.6 TH / s, and the price was $ 12.27. After the reduction, the computing power and currency price of the entire network did not increase directly, but maintained. For a period of time, the price of bitcoin has been maintained for more than a month, and the computing power of the network has been maintained for 80 days. It did not exceed 30T until February 16, 2013, and gradually increased.
Bitcoin's second halving took place on July 10, 2016. At that time, the computing power of the entire network was 1.64EH / s, and the price was $ 645.32. Since then, these two data have been maintained until the end of October, and then began to rise slowly.
Bitcoin price changes and previous production reductions
If the current production reduction still follows the previous two production reduction laws, then after the production reduction, the currency price will be maintained for a period of time, and the 16nm mining machine will indeed suffer the " disastrous disaster " .
Under the condition that the market price is unchanged, the daily revenue will decline in a cliff-like manner . For the Ant S9, which currently accounts for 92% of the comprehensive mining electricity bill, this is an unbearable weight of life.
This weight of life can be illustrated with a set of data.
In the year before the 12-year output reduction, the miner's income was about 3.8 Kusdt / T. After the production reduction, it directly reached 1.66 Kusdt / T , which lasted until February 16 after 80 days. The second cut will take a little longer, and it took 10 months to return to the first half of the cut.
Faced with such a severe situation, what to do with a 16nm mining machine represented by Ant S9?
3 export of mining machines may be a good recipe
Looking for cheap electricity for the export of old mining machines may be a good medicine.
In early February, Barry Silbert, founder of Grayscale Investments, the world's largest cryptocurrency asset management company, said,
"What I've seen recently, maybe in the past three to six months, a real shift is happening, that is, many bitcoin mining activities are trying to move to the United States and Canada outside of China."
There are abundant hydropower resources near the five Great Lakes
Although Barry did not disclose the reason why the miners went to sea, the sea must be for cheap electricity. This is especially true for second-hand miners who are about to be eliminated.
This is because mining cost expenditures are mainly composed of mining machine costs, electricity costs, mine leasing fees, and operation and maintenance costs. Among them, mining machine costs and electricity costs account for the bulk of the cost of those second-hand mining machine bodies that will soon be eliminated. Can be ignored. Therefore, the bulk of mining expenditure is electricity costs, so finding cheap electricity is the best way to increase revenue.
Taking the latest generation of ant mining machine S17 pro on the market as an example, under the condition that the cost of the mining machine, the expenditure of the mine and other conditions remain unchanged, when the electricity fee is 0.4 yuan / degree, the daily gross profit of this mining machine is 37.85 When the electricity cost is 0.19 yuan / degree, the daily gross profit of this miner is 47.81 yuan. It can be seen that the gross profit at this time has increased by 26%.
Similarly, taking S9, which is facing the risk of being eliminated, as an example, when the electricity fee is 0.40 yuan / kWh, the electricity expense accounted for more than 92% of the mining revenue, and when the electricity fee cost is 0.2 yuan / kWh, the profitability is not significant the same.
Earlier, the OKEx Intelligence Bureau interviewed Wu Zheng, a Central Asian miner. Regarding foreign mining, he said:
"Electricity costs are less than 2 cents, and those miners that cannot start construction in China can make money."
Wu Zheng arrived in Kazakhstan in the first half of 2019, belonging to an earlier group of miners who went to Kazakhstan to mine.
For Wu Zheng, compared with domestic thermal power, which generally exceeds 0.4 yuan, Kazakhstan's electricity bill of less than 0.2 yuan is not too attractive for him.
"Generally, the mining machines that go to the Middle East are the previous generation of mining machines. The latest generation of mining machines are basically mining in the country. Generally, the ants S9 from Bitmain, Ebit E10 from Ebang International, and Shenma M3 and other mining machines. We use a certain type of mining machine from Yibit, with a computing power of 18T and a power consumption of about 1800W. "
So, can two cents of electricity bills make money?
Let's take a certain type of mining machine from Wuzheng Minefield as an example. When the electricity cost is 0.4 yuan / degree, the daily gross profit is 3.17 yuan. If the electricity cost is reduced from 0.4 yuan / degree to 0.19 yuan / degree, the daily gross profit of this miner will be 12.24 yuan , and the gross profit will increase by 286%.
Compared with the mining revenue of Ant S17Pro miner under different electricity fee environments, we can also draw such a conclusion: the older the miner, the higher the profit from overseas mining.
"If you use the Antminer S9, which has a slightly higher performance, it will pay back a month, but these data will change as the market changes." Wu Zheng told OKEx Intelligence.
As the mining industry enters the era of low profit, the mining process itself is a process of fighting for capital and energy, and sometimes even luck and courage.
As the 16nm mining machine is about to enter the dusk, all the miners can do is to maximize their investment income. In this process, some people choose to sell the mining machine to the waste recycling station, some choose to go to the sea, others choose to wait , And what choice do you make?