Bitcoin’s surge puts pressure on miners

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Pressure on miners is not something that crypto enthusiasts probably think about too much. The leading crypto is enjoying a bull run and that’s the focus of our attention. However, according to Coindesk, “Bitcoin’s ongoing bull run has juiced demand for new mining equipment, putting pressure on manufacturers to produce enough machines to satiate buyers.”

Steven Mosher, head of global sales and marketing at Canaan Creative, maker of the Avalon miner, said, “The surge in bitcoin resulted in increased demand and supplies were already short.” And in an email he added, “the current state of the industry is that inventories are down and demand is high.” He further pointed out, “It looks like a return to the 2017 Q3, Q4 conditions, where demand was three times the supply.”

TokenInsight, a crypto startup that focuses on mining and trading research has also collected data showing that the price increase over the past several months also led to a significant drop of the time it takes for new mining equipment to pay for itself. Indeed, it estimates the average payback period for most mining equipment in the second quarter has dropped to the range of between 60 to 150 days, a significant decrease from the previous range of 120 to 280 days.

This situation is an opportunity for the companies that produce mining equipment. Canaan launched a new mining model last month, the AvalonMiner 1041, which it claims can compute as much as 37 terahashes per second (TH/s) with electricity consumption at 2,361 watts per hour. Mosher revealed that pre-orders for such models are already queued up to as late as October delivery, due to the bulk of buying interest coming from larger customers.

The firm producing the more expensive WhatsMiner M20 said it has also seen an increase in demand, and the next batch of M20s, which are scheduled for shipment as late as October, is “almost sold out” at the moment.

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