The global shortage of chips used in the production of bitcoin mining equipment is now causing manufacturing disruptions. According to a report, these interruptions caused a shortage of drilling rigs on the market and subsequent price increases. The report has shown that the price of new mining equipment has doubled, while the price of used machinery has risen by more than 50% in the past year.
Chipmakers shy away from Bitcoin rig makers
Driven by the rising value of Bitcoin, the demand for mining equipment has been rising as miners seek to maximize returns. However, as the report explains, chip manufacturers are making the situation worse because they are now giving priority to supplying products to other sectors. According to this report, chip manufacturers such as Taiwan Semiconductor Manufacturing Corporation and Samsung Electronics Co., Ltd. are reportedly avoiding Bitcoin mining equipment manufacturers.
The report quoted Alex Ao, vice president of Innosilicon, saying that chip makers chose to serve the “consumer electronics” field because their demand “looks more stable.” In addition to being used in the manufacture of consumer electronics products, these chips are also used in the production of products such as automobiles, notebook computers and mobile phones.
At the same time, as the report explains, continued shortages may reconfigure the Bitcoin mining industry landscape. In fact, the report quoted Wayne Zhao, the chief operating officer of Tokeninsight, which is already happening. Although many studies, including the latest Messari report, have reiterated China’s dominance in Bitcoin mining, Zhao said this has changed.
China loses the hashrate battle
According to Zhao, “Although Bitcoin mining in China used to account for 80% of the world’s total, it now accounts for about 50% of the world.” The chief operating officer explained:
China has always used low electricity costs as its core advantage, but with the rise in the price of Bitcoin, this situation has disappeared.
In addition, the argument in favor of General Aviation is Lei Tong, managing director of financial services at Babel Finance. According to Tong’s assessment, almost “all major miners are searching the rig market and they are willing to pay high prices for second-hand machines.” However, as he observed, “the purchase from North America is huge and is squeezing China’s supply. .”
However, as CoinCorner CEO Danny Scott (Danny Scott) explained in answering a written question from News.bitcoin.com, the recent highest (ATH) Bitcoin mining hash rate has made miners It is extremely unlikely to leave China. However, he added:
“So it seems that there is no closure, on the contrary. Even if the miners do leave China, this may be beneficial because they may have all moved to new locations, further decentralizing mining rights around the world.
Therefore, it remains to be seen whether the rising price of Bitcoin and the shortage of drilling rigs will eventually cause China to lose its dominant position.
Do you agree that China’s status as the number one Bitcoin mining center is threatened? You can share your opinion in the comments section below.
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