When it comes to market-leading cryptocurrency mining technology, the Chinese-based mining giant, Bitmain, is a legend of the game and it doesn’t get any bigger. Although the company is mysterious at best, a new report has suggested that the crypto mining megalodon could be losing its advantage in the mining tech marketplace.
As China comes under attack from the Russian crypto mining industry that is currently gearing up to threaten China’s title as the premier mining destination in the world, the news that the cryptocurrency mining technology company has lost a step or two is going to raise a few eyebrows.
The changing face of cryptocurrency mining technology
The respected news outlet, Bloomberg, has recently reported that Bitmain, which is the most profitable cryptocurrency mining technology firm in the world, is slowly falling out of favor. Although this will be laughable news to some, as analytics show that Bitmain still controls a massive 85% of the crypto mining equipment sector, other notable crypto mining tech firms such as Ebang International Holdings Inc. and Canaan Inc. are closing the gap.
The news from Bloomberg was pulled from a recent report from the investment research company, Sanford C. Bernstein & Co, who have suggested that Bitmain might be losing a step or two to other companies in the industry.
Bloomberg reported that the analysts in the report had said, “The Beijing-based company, co-founded by 32-year-old billionaire Jihan Wu, may need to write down the value of its inventory as makers of rival mining gear catch up.” The report also went on to say that “Taiwan Semiconductor Manufacturing Co., which produces chips designed by Bitmain, should ask the company to make full prepayments and refrain from adding capacity solely for [cryptocurrency] related demand.”
Bitmain taking drastic steps in recent months
Bitmain makes the majority of their money from selling cryptocurrency mining technology and equipment, with just a small percentage of their profits supposedly coming from the mining of crypto and the fees it charges renting out mining space and power to other mining companies. Although the capability of diversifying their profits is already there, the sale of tech is the heartbeat of their business.
If the details in the report from Sanford C. Bernstein are accurate, it would make sense that Bitmain has been taking steps to streamline their business in recent months. In a controversial move in March 2018, Bitmain sold mining equipment for Monero that totaled USD 12,000, even though there is speculation that they already knew it would become obsolete by the time it shipped the item.
Attempts to diversify their income stream also became evident earlier this month when the company announced its plans to build a cryptocurrency mining farm in Texas to the tune of USD 500 million. The cryptocurrency mining technology giants also recently invested in other non-mining related projects such as their involvement in a new blockchain platform for the web-browser, Opera, and other investments in a variety of decentralized exchanges.
Although Bitmain’s grip on the sale of cryptocurrency mining technology might not be what it once was, there is no need to write an epitaph just yet.