On April 7th, Babbitt Global Partners Cloud Summit Forum 5-Mining Circle Enterprise Evolution kicked off, Cai Yunbit founder Lu Lei, Bitmain co-founder Li Min (real name Li Yingfei), Wonderful Capital founder Mint were invited participate.
Regarding the mining industry, the three senior practitioners shared many world-leading opinions, such as:
1. The flow of mining capital is stable, which is convenient for compliance operation. The mining profit rate is very high for traditional industries. This is an "outside blue sea."
- Bitcoin's transaction price has fallen below the average mining cost
- Re-use the "shutdown currency price" to calculate the bottom and top of the BTC before production reduction
- The halving effect of BTC: is it "metaphysics", or is it a real "effect" that will have a substantial impact on the market?
- "Determinism" and "uncertainty" on the eve of Bitcoin's cuts, how should miners and investors respond?
- Conversation | Bitcoin halved, is it really good or fake?
- What to do after halving Bitcoin? All these transactions say
2. This time Bitcoin should have a 10-fold increase, which may be the last time interval for a large-scale increase.
3. Miners are no longer blindly pursuing low electricity prices, stability has become a more important consideration, and the industry has gradually matured.
4. The mining industry is evolving, and the boundaries of different fields will become more and more blurred, fusion competition will intensify, and refinement and specialization will be strengthened.
5. The importance and weight of mining machine manufacturers in the market will decline, they will transform, one is to develop in the direction of various software services. The second is to enter the altcoin mining machine market.
The following content is collated by Babbitt.
Is mining the Red Sea OR Blue Sea market?
Li Mine: Bitcoin mining is a cycle from the Red Sea to the Blue Sea to the Red Sea. For example, the bear market can be understood as the Red Sea, the new computing power is reduced, and even the miners are forced to shut down.
But every adjustment is an opportunity for mining machine manufacturers and miners. Whoever has advanced technology, smooth operation and maintenance of the mine, and cheaper electricity bills will find the blue ocean.
Lu Lei: Mining in the circle is the Red Sea, and outside the circle is the Blue Sea.
The Red Sea Index in the circle said that mining has been very small before, but today, exchanges, miners, platforms … cryptocurrency players are all laying out mining, and competition is intensifying. There are two reasons, one is that the cash flow from mining is relatively healthy, and the other is that the mining industry is relatively loose at the policy level, which is convenient for corporate and standardized operations.
The blue ocean index outside the circle, in the eyes of the old miners, one year return is too long, but this rate of return is very high for traditional industries. Some customers contacted by Caiyunbit are surprised and satisfied with the high yield of mining.
This also shows that mining is relatively unpopular and scarce outside the circle, they do not know how to participate in mining. So, I think there are still many opportunities for mining.
What happens after Bitcoin halves? What did you do to halve?
Li Mine: President Han (Wu Jihan) said in a live broadcast recently that he is not particularly fanatical about Bitcoin. This does not mean that he is not optimistic about the market, nor does he mean that he thinks Bitcoin is not very good. Rather, there are many dimensions of thinking about this matter.
This is a more rational and mature cognitive approach to Bitcoin, to Bitmain, and to this industry.
Mint: As a mine, we must ensure sufficient cash flow to deal with the risk of halving this time. Secondly, I entered the mining circle in November 19, and I chose high-power and low-power mining machines, which is less risky than small-power and high-power mining machines. We are still optimistic about the entire mining industry.
We expect Bitcoin's price to rise in the long run, but we cannot predict it in the short term.
Lu Lei: What we do is an enterprise, what we pursue is profit, and the development of the company. From this perspective, every day we are ready for the currency price to plummet.
This industry is beyond imagination when it is hot, and it is very miserable when it is cold. We have encountered that because we are too optimistic about the market, we want to sell houses, loans, studs. Generally, we advise him to calm down.
This industry is more volatile than any industry. Practitioners should first consider this volatility and how to survive, rather than staring at high profits.
Halving is not the core reason for the rising market, it is more an incentive. Bitcoin has produced more than 80%, and the halving has little effect on supply and demand.
I think the core logic of price increase is that it is accepted by more people and accepted by more capital markets. When everyone no longer talks about it in a different light, it has a lot of room to rise.
I think that this time Bitcoin should have a 10-fold increase, which may be the last period of large-scale increase.
Renewal of mining machine, which mining machine of Caiyunbit sells best?
Lu Lei: Caiyunbit entered the mining machine sales track in 13 years and sold tens of thousands of mining machines in 6 years. Our mall mainly sells new mining machines. The sales of new machines such as Ant S17 and Shenma M20S are quite large. The sales of Avalon A1066 and T2T series are also good.
Several domestic manufacturers can find a suitable entry point according to their product characteristics, and at a certain point in time, launch a certain highly efficient product.
Overall, the lower the power consumption ratio, the more advanced the mining machine sales are, the better the sustainability and the stronger the vitality.
▲ From left to right, top to bottom: Junyao, Mint, Li Mine, Lu Lei
How does Bitmain maintain its technological leadership, and how long can the new generation of S19 be dug?
Li Mine: The longer you engage in the design of a mining machine, the wrong will have great benefits, at least you can find that this road does not work! Bitmain's advantages are all tried out bit by bit in technology.
I think S19 can lead at least half a year. How long it can dig is not particularly related to the price of the currency. If the price of the currency rises fast, it can dig for a long time. If the price of the currency is not long, it can dig longer because the new models will not come out. S19 I think it is no problem to dig for more than three years.
Mint question: When the chip enters the 5 nanometer era, it will be more and more difficult to update. Everyone generally sees the advantages of power resources in the mining track. What do you think of the development trend of domestic mining?
Li Mine: We say that China has cheap electricity resources. In fact, all countries have very cheap electricity. But it is quite difficult for Chinese miners to go out.
Countries have different cultures, policies, and tariffs. You have no experience. Once these things are cleared, the opportunity is missed. For example, if you go to investigate resources in the spring, when you feel almost the same, it snows.
We also found that some countries have stable policies and very cheap resources, but the mine construction cycle is very long and requires a lot of investment, so it needs to be fully prepared. If you are optimistic about mining in the next 5 years, you will slowly build abroad. If you want to be quick and easy, grasp the market, the suggestion is still in China.
You have to make an estimate of the opportunity cost of your time.
Lu Lei: Everyone in the circle feels that the mining profit level has been declining, but it is still very attractive to outside circles. Coupled with the increasing standardization of mining, and as the chip manufacturing process slowly enters the limit stage, more people may plan and deploy mining from a more long-term perspective, which is a new feature of the development of this industry.
To insert an advertisement, I'm now on a train going to a 100,000-kilowatt power grid mine that is about to be built by Caiyunbit. Investors who need a stable and stable mine can contact me.
There are newly listed mining machines and second-hand mining machines in Caiyun Bit Mall. What do you think of the second-hand mining machine market?
Lu Lei: Second-hand mining machines are a big market. When we analyze the website traffic of Caiyunbit, many people are looking at the second-hand mining machine. We don't sell much used mining machines, but this supply and demand information channel allows everyone to freely publish used machine information.
The supply channels of second-hand mining machines are very complicated and diverse. Some retail players play it by themselves, there are small mines, large mine owners, large mines changing machines, manufacturers changing machines, etc.
Used mining machines are generally high in power consumption and cheap in price. Their core uses are mainly in mines with competitive electricity prices.
It is not recommended for newcomers to participate in the second-hand mining machine market. Its risks lie in machine quality and delivery risk.
Li Mine: Recently, the second-hand mining machine is very hot. After the plunge, many hydropower mines have great pressure to attract investment. If the mines are not fully filled, the mine owners cannot explain to the power plant, so they simply collect second-hand miners, such as Ant S9 plus a power supply for more than 100 yuan Used to load the mine. Of course, some people ran over at this time. They are basically people with cheap electricity resources.
Mint question: What do you think of the competition between thermal power and hydropower mines? Will the surplus of mine construction cause excessive resources?
Li Mine: Mint mentioned the difficulty of mine survival this year, which is a common problem faced by hydropower and thermal power. It should be said that the cost of thermal power is relatively high. As the currency price drops sharply, the difficulty of operation is indeed greater. But the advantage of thermal power is stability.
In addition, from Fengshui last year to this year, there are more and more mining participants, and mine resources are no longer as scarce as before, so this is also a process of scouring the sand.
Today, machines with large computing power and low power consumption are generally very expensive, and everyone still expects to be placed in a stable mine. The thermal power plant has reached an era of hard service. If the mine is built well and the quality of operation and maintenance is good, there will be advantages.
Lu Lei: I add that everyone is no longer blindly pursuing low electricity prices, and stability has become an important reference factor. This is a process in which the industry gradually matures. Our key layout is now also a mine of grid power.
What do you think of the mining pool made by the transaction?
Lu Lei: I think this is the more important strategic layout of the exchange, because the coins are mined by miners. Whoever "seizes" the miner group, its exchange will come in a lot of coins and have a mining pool and computing power , It promotes the brand of the exchange.
If the exchanges provide some subsidies to the mining pool, they will be particularly attractive to users.
And the exchange can provide a lot of services, financial strength. However, the mining pool is relatively mature in technology accumulation and understands the miners. It can be said that the mining pool made by the transaction brought the mining pool industry into the Red Sea stage.
Li Mine: I dare say that the mining pool for the transaction must have been thinking for a long time. Exchanges and mining integration, mining and financial products integration, exchanges to provide users with a full range of services, this must be the trend.
When the industry develops to the back, the boundaries will become more and more blurred, and everyone will become more and more integrated and competitive.
Lu Lei: We have also seen that the evolution of mining circle enterprises, on the one hand, is more and more integrated business, on the other hand, companies can also find their own special, the track will become more and more detailed.
Why is everyone starting to deploy cloud computing power?
Li Mine: The cloud computing power is the same as the mining pool for the transaction. They all want to increase their brand influence through strategic layout and horizontal expansion.
Cloud computing power is a good opportunity for many small miners to get started. In the future, many manufacturers will have to get involved in this link to attract users. I do n’t think it ’s particularly important to make money or not.
Lu Lei: More and more cloud computing power should be said to be the inevitable direction of the development of the industry. Mining machines and mines are becoming more and more specialized. Future mining enthusiasts or investors will definitely enter this industry through a service provider. The simple and convenient characteristics of cloud computing power must be an important entrance for mining investors to participate in this industry in the future.
Caiyun does mining machine sales and mining machine hosting, why not do cloud computing power? We must make cloud computing power into a product that is suitable for the time, suitable, compliant, long-term, and suitable for ordinary investors.
Caiyun's bit cloud computing power customers currently have a small number of B-ends, most C-ends. I also mine and am a miner, so we have always wanted to make mining as simple as a game and as reliable as a century-old store. Many people can participate.
The cloud computing power of Caiyunbit is based on a perpetual contract, which means that it has been dug until the output cannot cover the cost of electricity for a long time. Why choose to launch this form of cloud computing power instead of short-term computing power?
Lu Lei: The biggest value of mining lies in its time value. Mining can use time to suppress risks, and can use time to win greater profits. Mining is a loss-controllable business with a large profit margin. In other words, on the basis of optimizing computing power and low power consumption ratio computing power, digging while gaining, waiting for the huge gains brought by the skyrocketing currency price, this is the core value of mining. No one can tell when the currency price has risen sharply, so the perpetual contract is crucial, so that the miners have sufficient time to enjoy the maximum benefits brought by the skyrocketing currency price.
Why are there no cloud computing products for small currencies?
Li Mine: The speed of keeping up with small currency miners (the increase in computing power) is not so fast, and the user population is very small. Moreover, the cloud computing power platform needs to hoard goods first, and the stocking process is very risky.
In general, mines and mining machines are more stable and continuous mining, and can be mined for a long time, this kind of currency is suitable for the platform of cloud computing power.
Mint: Bitcoin is currently not particularly stable, and the stability of small currencies is weaker. If the return of a certain currency is high, the period of high return will be very short, because the return is high enough to attract a lot of people to come in and reduce the return. If the income is low, it is not attractive.
Cloud computing power currently sees a relatively high market education cost. In the future, in the short or long term, it will have such an explosive stage.
How do ordinary investors enter the mining industry? How to avoid risks?
Lu Lei: Mining machine hosting can be compared to the cloud computing power more suitable for professional players. Mining machine hosting requires users to understand the mining machine performance, parameters, brand, and use of mining pools. We have both hosting and computing power. Welcome everyone to choose freely.
But for ordinary investors, I suggest to choose Caiyun standard computing power. The mining machine corresponding to this computing power has been carefully selected by us. The team has 6 years of experience in the industry and is familiar with various mining machines on the market. The degree is better than the average user. We are a perpetual contract, and our value comes from serving our customers, and customers are willing to choose us based on trust in us and our ability to create profits for users. We are subjectively and objectively optimizing computing power for all our resources.
Ordinary investors choose Caiyun standard computing power to save the trouble and risk of how to choose mining machines.
What are your new plans for 2020? How do you judge future trends?
Lu Lei: With the halving, we see that there are more and more participants in the mining circle, and users have higher and higher requirements on the comprehensive service capabilities of the mining circle enterprises. Both are strong, in fact, companies in the circle should be more and more professional.
In the future, Caiyun will use cloud computing power as the core to provide one-stop services for mining enthusiasts and investors. In fact, cloud computing power is a combination of mining machine purchase + hosting + access to the mining pool. It can be said that Caiyun has been doing for so many years One thing about cloud computing power is to allow more people to participate in mining conveniently and enjoy the dividends brought by industry growth.
In the future, I hope that the price of coins will increase more than 10 times. Everyone talking about bitcoin after dinner is as common as talking about a certain stock, and no longer looks at people who play with coins with strange eyes.
Li Mine: In the next 10 years, I am particularly optimistic about this industry. I think that Bitcoin and the entire industry will sink to a wider group of people, and the convenience of using digital currency will increase.
If existing enterprises want to seize this opportunity to serve more users, the value carried by the entire industry will also increase.
During this round of plunge, many people found that the contract risk was very high and began to consider making low-risk investments. So, Matrixport will provide customers with some low-risk and stable income tools, such as double wealth management.
Mint: I will talk about:
Mining machine makers: The importance and weight of mining machine manufacturers in the market will decline, because the mining machine chips have reached the technical bottleneck of the entire chip industry, and the fine operation of the mining machine manufacturers may only be the iteration of the hardware of some products, such as power , Optimization of all aspects of energy consumption.
There are two directions for the transformation of miners: One is the field of Bitcoin, which will develop in the direction of various software services. The second is the altcoin mining machine. In fact, Bitmain has not been relaxed in this regard, such as Dashi mining machine, K5 mining machine.
Mine: The resource structure will undergo adjustments, and the big mine owner must be deeply tied to the power resources. The future mining oligarchs must appear in the hands of institutions that have a say in the hydropower industry.
Policy dividends: In recent years, we have seen local policies continue to encourage the “big data and cloud computing” industry in the form of industrial parks. For example, the government of Ganzi Prefecture in Sichuan listed an industrial park last year. However, the specific policies have not yet come down, and we should be able to see the policies for the positive development of the industry in the next few years.
Derivatives industry: The financial derivatives of mining industry actually developed very fast last year, and the entire market borrowing should exceed 1 billion US dollars. This trend will continue upward.