In the winter of 2017, the night in inner mongolia was cold and outdoor temperatures were below minus 20 degrees celsius。
In a desolate “mine”, since there is no recreational activity, the bitcoin miner from zhejiangzhou, feng sheng, sleeps in a large room “up and down, where seven or eight people can sleep early”。
“the site is far from the nearest town, half a day, like gobi beach. There's nothing but a site and a road." he said to journalists that it was an endless wasteland。
The “mine” to which feng sheng went is on an inner mongolian wasteland. It was a fiery bitcoin that had driven the young man from the south to the cold. In 2017, the price of bitcoin rose from $1,000 at the beginning of the year to $13,000 at the end of the year, a tenfold increase. Feng is just one of the many gold miners. Behind him are a large group of people who have come to terms with "digital gold"。
At the beginning of the second half of 2020, bitcoin miners seemed to smell the “crazy” of three years ago. Bitcoin prices went up by $10,000 and at one point crossed the $40,000 threshold。
Fung was just graduated from university in 2017, and now he has more than three years of “mining” and has experienced a sharp drop in bitcoin prices from nearly $20,000 in december 2017 to around $3,000 in december 2018。
In the face of the current boom in bitcoin prices since 2017, after having experienced a “spill wave”, feng shing told journalists that “mining is a long-term endeavour to upgrade the machines ahead of schedule, the site, electricity prices and electricity bills have been planned, and the impact of changes in the subsequent currencies has been marginal”. Mining is in fact an activity with potential policy risks. In september 2017, the people's bank of china and seven other departments issued a joint bulletin on protection against the risk of financing the issuance of coins, calling for the suspension of all forms of financing for their issuance. Domestic encrypted currency exchanges were gradually closed and virtual currency mining was once required to exit in an orderly manner. Because of its high electricity consumption, virtual currency mining was once also published by the national commission for the reform of the directory of industrial structural adjustments. It was included in the list of “step-out industries”, but in the official draft it was “a break”。
Books of miners: costs include electricity, custody and mine costs
“bitcoin mining takes 12 months to return”, “the price of a bitcoin mine is twice as high as the demand”. With the price of bitcoin running at a high level of $30,000 and $40,000, bitcoin mining was seized twice in a row. The “miners” who swim in the grey zone and hide behind the coin-slayers are also back in the mainstream。
In 2015, guo li travelled to sichuan to visit the mine. It was during the rainy season, when rains often broke down the roads and the roads continued to fall。
"it's dangerous, and i feel like i'm doing this with my life," guo li recalled. However, since then, guo li has begun to build mines。
Bitcoin was excavated. Under the bitcoin pow (workload certification) mechanism, each computer node has its calculus (calculation) to seize the right to record, and whoever seizes the right to record will receive the corresponding bitcoin incentive generated by the system, a process called “mining”. Hardware mining equipment is called “mineers”, individual miners who buy machines are called “miners”, or “minefields” where they host and provide electricity, or mining platforms “mine ponds”。
“now people outside see it as if our industry is making money, and it's hard behind it. Everyone worked very hard, very hard." guo li said。
In 2019, liu wu, a bitcoin miner from suzhou, threw money on a cloud-drilling platform in a state of “throwing away a little money and if he is deceived”, and put money on it. After the first 2,000 multi-entry payments for the sale of bitcoin, liu wu-yu became involved in the mining industry。
The earnings of miners are the amount of incentives in bitcoin in each block dug up, the cost of which is mainly the cost of electricity to the mine, the cost of hosting, and the cost of purchasing the mine。
Hostage and electricity charges are usually calculated in conjunction with the fact that chen 9, the miner at jiang sunantong, told journalists that he now needs 60,000 yuan per month for electricity and that he could probably dig up a bitcoin per month (about $34,000 at current market prices)。
How much money is mine? The price of the mine is still very high
“it would be tempting to invest in a traditional industry for three years to recover the cost, to dig for more than one year, and to start recovering the cost from the first day of mine operation.” liu wu said. He held dozens of mining machines in mines in xinjiang, yunnan and sichuan, and his return was 12 per cent per month at 2019 currency prices。
The prices of bitcoin machines will vary with the price of bitcoin。
“i bought 30 68t m20s at a summer average price of $6,500。
Indeed, with the high level of bitcoin, mining has become a veritable “gold mine”, and the influx of new people and diasporas has made it difficult to find a bitcoin machine in the market. Currently, the newest mine production in bitcontinent, s19pro, is sold at $27,700 and the market price is now more than $50,000。
“ant miner is harder to rob than a mill phone, and every official sale is robbed in a second or two, and the order now appears to be in august.” chen 9 says。
At the machine sale price of $27770, it now takes six months for bitco to return the mine or, at market prices, double the time of return。
For miners, therefore, the timing of mining is important. The liaoning miner, who started digging in 2018, believed that his entry point was not good, that the machines that had been purchased were small calculators, and that only a little profit could be said for the moment。
“when it entered in 2017, the price of bitcoin was as high as 20,000 dollars, but it fell sharply in the following months, so it was important to choose the point of entry.” the dragon says。
Liu mu also said, “this year a lot of new people have entered the circle, and i don't think they're making any money. Because they're in a good market, the machine is more expensive."
Lung stated that, since 2020, the earnings under the current cattle market had been good, “at least triple” if bitcoin were sold at $41,000。
2020: 312: 50%, bitcoin cow
In 2020, bitcoin experienced a massive rise. Of these, 12 march is a day still remembered by encrypted money operators。
Bitcoin prices fell two days in a row as a result of the double effects of the new coronary epidemic and the oil price war. On 12 march, the bitcoin fell below $4,000 at one point, a decrease of more than 50 per cent from the february maximum。
When miners do not earn enough to pay the electricity they consume, the currency price at this time is referred to as the “close-off price”, which affects factors such as the price of money, the price of electricity, and the difficulty of mining. If the currency falls “off-the-post” the miners need to close the mine or lose。
“everyone is in a state of uncertainty, and mine friends are calling each other to ask if there will be a continued collapse, whether there will be a sale of currency or a continuing choice to watch, and no one can give an answer.” the founder of the yung industrial park and the miner chen xiaolong said。
He stated that there had been some confusion and a great deal of panic, and that if the price of panic continued to fall and electricity was not consumed, there would be a huge loss。
“many of the amphibious miners did not pay their electricity bills at that time, with selective shutdowns, some of the amphibious miners, and machines did not pay off the electricity bill. I don't know if i should take back some of my clients' machines at a low price."。
Will the mining machine be sold again in 2018? This is the “mud cloud” that surrounds many of the mining operators in bitcoin。
However, the intergenerational optimization of the mine is based on the fact that the price of the large calculator is lower, so that the victory of feng, who has just bought the new machine, has not been significantly affected by the fact that “calculation is in place and is not simply a matter of settling electricity bills”. Liu wu, the miner, also indicated that he was short on investment and had a small profit, but could continue to operate。
“312 has no impact on the mine, but the mindset of the people was rather broken when it came to the whole mine, the currency in hand. Because no one can imagine that it has broken expectations and that bitcoin might be zero.” guo li, miner。
In may, the four-year cut-off of bitcoin meant that the amount of bitcoin incentives per block dug by miners had dropped from 12. 5 bitcoin to 6. 25 bitcoin, with the attendant cut-off of revenues from miners。
“by halving bitcoin, it was the miner and miner who suffered the most, because the output fell by half in an instant, and after the cut-off point, the price of digging became 60,000 yuan, but the price of the miner, li bo, said to the news. At that time, his mine was closed to 30 per cent。
By the end of october, bitcoin had risen so fast from $11,000 to over $20,000, $30,000 and $40,000, and now hovered at $34,000。
In 2020, the miner lung has been insisting on the hoarding of coins, and the three bitcoins he has dug up remain unsold。
“i don't think it's going to end this way, there's a certain historical pattern, and i've never had the first two halves, but only once in four years. I don't think it's $20,000 in the last wave, and it's gonna end with $40,000, so i do have confidence. Bitcoin to $50,000, i'll give a little bit, and i'll give a little more to $100,000." he said。
The miner feng sheng believes that mining is a long-term undertaking, with little impact on the change in the price of the latter currency by planning machine upgrades, site electricity prices and electricity bills in advance. “the shareholders were a little more diligent after the price of the currency went up, three days in two.” he laughed。
The miner chen 9 has some worries: "it's going too fast, i like the bull market, but i can't go so fast, i hope it's slow, slow, and it's going to take a little longer."
He now has a small amount of money in his hand, and even if it goes up, he does not have much to gain, and chen kyu believes that it is easy to end the cattle market early。
“too dramatic, there will be a lot of uncertainty, such as more stringent regulatory policies.”。
Like the "hotbirds": moving between southwest and northwest
In china, in pursuit of cheap electricity, mines are largely distributed in sichuan, yunnan, guizhou, xinjiang and inner mongolia, with electricity types such as hydropower, fire and wind。
Hydropower is the cheapest in yunnan and sichuan, but its disadvantages are the difference between abundant and dry water periods, the low cost of abundant and sufficient electricity for water-rich periods and the high cost of water for water-defeating periods。
Thus, in order to reduce costs, some miners need to move their machines to hydroelectricly abundant yunnan, sichuan, etc. During the water-rich period, or to hot or wind-rich xinjiang, inner mongolia, etc。
“10-20 per cent of miners do not need to move, 80 per cent of mine unions do”, chen ji said, “i dug a water-rich period in sichuan, and now sichuan has no electricity, so i go to xinjiang. Next year the water will come and move back to sichuan."
However, this migration is more directed at small-calculations miners。
Chen kyushu explained: “because of low electricity generation, the mines have to drive out some customers, which must be small power users, leaving large households behind. A large power of 3,500 watts, a small power of 1,300 watts and a large power of two and a half small machines must remain large. For the same purpose, only 100 machines and 250 machines will be maintained in large households. The fewer the machines, the less the work. Every mine likes a power machine."
Such migration also implies a partial loss of profits, as it takes a month to travel back and forth, and the mine cannot produce, amounting to stagnation。
In order to match the needs of miners, many miners have opened mines in areas where hydropower and other electricity are abundant. For example, guo li owns mines in sichuan and inner mongolia to facilitate the migration of miners。
It is noteworthy that the rise in currency prices does not appear to have led to a disproportionate change in returns to the mine。
Guo li, the mine owner, stated that his earnings were actually declining year by year: “at least one or two cents of electricity was available in 2015 and only about four cents are available now, because the mine industry is falling in prices, and the price of electricity cannot rise when it rises.”
"i'm boley now." guo li said。
Many clients signed contracts in 2020 to move to mining sites in inner mongolia after the end of sichuan's water-rich period. “it's not good to raise the price of electricity for a customer when the machines are installed,” he said。
The mine owner, chen xiaolong, also stated that he was currently spending us$ 0. 26 on electricity, and that he was charging more than us$ 0. 3 to the client for the power of the house。
The miners' wishes and plans
It seems that the extraction and hoarding of coins is a necessary plan for miners。
“hopes to slowly rise, give us more time to dig up the money for the miners,” chen said, “i don't have much money in my hand now, even if it goes up to 1 million, so i can dig up more time to hoard.”
He regretted that almost 220 coins had been dug over the years, but that they had not been hoarded, mostly on the eve of the cattle market in 2017. Chen kyushu also mentioned that mining is now becoming more difficult and that he is currently able to dig one at 4,800 t per month, compared to six in previous years。
The miner liu wuji recently received a new batch of bitcoin machines, and he planned to throw out the money to recover it when the price of the money was sufficient to cover the cost of acquiring it, “the movement behind is more casual and less passive”。
Dragon won't buy any more bitcoin machines。
"i've got 500 machines, i've got no electricity in the water, i've been able to run almost 400 recently, and i've been satisfied," he says, "because there's a part of the big calculator i haven't moved, i've got enough profit, i just wait, and i can't buy it anymore."
Liu wuxian, who also owns both tt and bitco machines, plans to purchase ttma machines because “bitcoons are now too expensive”。
The mine owner, guo li, plans to build new mines on a scale of 100,000 kilowatts。
“if currency prices are maintained at a level of $30,000 to $40,000, there should be a gradual increase in electricity costs this year. He said。
Do the miners of bitcoin have a bitcoin faith
Chen kyushu has been holding on to “the faith of old miners”。
Chen xiaolong said that his bitcoin faith was “one dollar a villa” and wished to leave some bitcoin for his children。
“it may be possible for more than eight years.” the miner, liu wu, said that he would change the direction of the investment with the returns and would not remain on bitcoin。
Guo li, frankly, has。
“just as you believed in love when you were young, and if you believed in it when you first went up, you might be suspicious of life when you first went down. It doesn't matter if you go through it a few times. He said。
(in chinese, feng sheng, guo li, liu wu, chen kyu and lung, aliases.)
