While leading bitcoin mining machine maker Bitmain doubled prices to capitalize on the overwhelming demand resulting from the surge in bitcoin price, it still pre-sold three months of inventory in just a few weeks.
Bitcoin mining has become more attractive after a record 2020
In early December, Bitmain started pre-sales of ASIC miners for bitcoin with a shipping date of May 2021. Less than a month later, Bitmain ran out of products on sale until August 2021 and raised prices significantly. significant.
At the end of November, Bitmain's Antminer S19 was priced at $ 1.897. Now, the same machine retails for $ 3.769, a 98% increase. Bitmain prices have risen, said Kevin Zhang, vice president of Business Development for New York-based mining firm Foundry, noting that demand for new ASICs shows no signs of abating in the near term. "But there was also a very limited presale from May to July next year for the S19 and S19 Pro models."
With miners eager to buy any machine available, secondary mining markets continue to benefit from the low inventory of primary producers with an increase that has hit their highest levels since 2017.
Prices for more efficient and second-hand models have risen to 12-month highs, according to market data published by Luxor Technologies. "Secondary markets are also booming," said Amanda Fabiano, head of mining at Galaxy Digital.
“The S9s that were selling in May 2019 for $ 20 are now selling for $ 130 on some channels,” he said. The surge in mining comes after bitcoin ended 2020 with a gain of over 300%, and is currently trading just under $ 34.000 - here quotation in real time.
The "perfect storm"
Miners' revenue also shot up with yields per terahash per second (TH / s) hitting $ 0,25 on Sunday, the highest level since August 2019, according to data from Luxor. To meet the growing market demand, Bitmain has "improved the efficiency and capabilities of our manufacturing facilities," said director of international marketing Nathaniel Yu.
Fabiano described the current conditions of the mining machinery market as a "perfect storm" for supply constraints: limited capacity in foundries, larger facilities purchasing new tools for mining, and companies with solid balance sheets entering the market with the to place massive orders.
These massive orders come from mining companies like Riot Blockchain (RIOT), which bought over 31.000 new machines this year, Core Scientific, which bought 59.000 machines from Bitmain in a single order, and Marathon Patent Group (MARA) which expanded its mining fleet to over 100.000 machines. “At this rate, hardware procurement will continue to be a problem throughout 2021,” Fabiano said.
