Bitcoin price is stuck around $9,100, but the hash rate of the network is continuing its ascent since crashing after the block reward halving.
The hashrate is yet again near the all-time high at around 130 Th/s after the jump in difficulty – the biggest since January 2018. Despite this, the bitcoin block mining time is back below 10 minutes since mid-June. Currently, a new BTC is being produced at an interval of 8 minutes 37 seconds, as per Bitinfocharts.
Amidst this, BEG reported that bitcoin mining giant Bitmain had received an order for 17,500 S19 mining machines from the US blockchain service provider, Core Scientific. The first batch of the agreement, which has a duration of four months, has already been delivered.
The latest flagship bitcoin mining machine of Bitmain currently costs 14,260 yuan, just over US$2,000.
A similar trend is seen by F2Pool, which reported receiving orders of large quantities of new-gen hardware from some of the biggest North American bitcoin mining operators.
On top of this, China’s rainy season is in full swing. The country is facing its worst flood in 70 years, with many plateaus in southwestern Sichuan Province experiencing heavy rain since mid-June. This was expected to continue in some parts of Sichuan.
Sichuan is of strategic importance for the Chinese mining ecosystem as such could play a part in the potential loss of mining hash power out of China, said Denis Vinokourov of Bequant.
All these bitcoin miner orders and “the hydro season in China coming to a close in October 2020 could see the biggest shift in hashrate,” said F2Pool.
The inertia keeping the majority of hashrate in China could eventually lose its grip on the industry. It’s likely the development of farms outside of China will increase pace in 2020 🚀
— f2pool (@f2pool_official) June 29, 2020
Already capital controls in China have miners exporting their operations outside of China, and de-dollarisation of various financial systems, specifically in emerging economies are pushing them toward bitcoin mining.
These factors, combined with the institutionalization and financing of mining operations with the US, is why China has already started experiencing a sharp decline in Bitcoin mining dominance, which states the Amun Report.
Moreover, the US is seeing an increase in hashrate, now accounting for 7.2% of market share, making it the second-largest hash rate contributor after China.
Bitcoin Miners Expanding
Amidst this, Bitcoin miners are expanding their business, some even out of the mining sector.
Hut 8 has raised a total of $8.3 million from selling a 6% equity stake to investors, about $88k more than the original $7.5 million funding target. The Toronto-listed mining company is planning to invest this in new equipment that will enable them to increase their mining capacity to over a fifth.
“This financing is expected to strengthen Hut 8’s cash flows and balance sheet,” said company spokesperson Ryleigh Ebron.
Ebang International Holdings Inc. meanwhile is planning to launch an offshore cryptocurrency exchange this year, in an attempt to diversify beyond the mining sector. The company is considering applying for licenses in Singapore or the US or acquiring an existing exchange operator.
The Chinese crypto mining giant could see its total revenue grow about 40% in 2020, after expanding into the newer business of clients that manage data centers, said the company CFO, Chen Lei.
Revenue could double to $200 million this with the launch of digital asset exchange, otherwise, the mark should be hit in 2022, he said.
The Hangzhou-based maker of Bitcoin mining rigs that went live on Nasdaq under the ticker EBON last week has its shares currently trading at $4.50, down from the IPO price of $5.23 where it raised $100 million.
Ebang is planning to use the proceeds from the US share sale to develop new models of machines and expand overseas. Setting up regulatory-compliant crypto exchange outside China is part of the plan. Chen expects to initially attract 10% of the total transaction fees of digital asset trading.
Ebang is not the only one looking into expansion; its rivals Bitmain and Canaan are also betting on making chips in the field of artificial intelligence to reduce their reliance on BTC prices.