In the past six months, the bitcoin world has been repeating the story of the big gold age. An active industrial chain is supporting the ambition and desire of this magical world.
The bubble bubble seems to be an issue that need not be discussed, but the production chain is pushed up from the production of chip cards and mines to the marginal value geometry of its 'mining' and its regulatory logic The market dispute the front desk.
The so-called bitcoin mining, is the use of computer hardware, such as chips, video cards, etc., set by the Satomi's 'proof of work' mechanism to calculate the qualified bitcoin random number can be commonly understood as lottery winning numbers, The process of eventually getting bitcoin rewards.
In contrast to the myths of making wealth in the Bitcoin secondary market, the anxiety and despair of currency prices, the business logic of mining on the primary market appears to be traditional to many in the industry. "As long as the price of a currency exceeds the cost of electricity and fixed assets, Costs, mining profits. As long as the return of the mentality becomes earned like. 'One just entered the market of cryptocurrency miners told the' Financial News' reporter.
As Bitcoin gradually opens the strongest bull market in the history of 2017, more and more people are joining the ranks of 'miners.' One mine owner left the state-owned enterprises that stayed for more than a decade in July last year, Industry. 'The reason is simple: income.'
When bitcoin prices soared to 20,000 U.S. dollars in December last year, the profit margin of mining was also at a historical peak, "returning to the capital one month later," he said.
However, as the currency started to go down at the end of last year and China's regulatory environment continued to decline, a round of industry reshuffle was already opened.
Regulatory oversight, what is the logic
According to previous "Caijing" report, the Internet financial risk special rectification working group issued a document on January 2 , Requiring all localities to do a comprehensive management to take electricity, land, taxation and environmental protection measures, the mine 'guide the orderly exit'.
Regulation is still overweight.
"Caijing" reporter from the central bank people get information, by the Central Bank and other 17 departments of the Internet financial risk remediation group, will further pressure to the local office to tighten the domestic 'mining' industry.In addition, according to the above access to the central bank The people's news, the central bank also set up inspection teams, from time to time in the country inspection.
It is understood that the central bank has found out that a number of 'mining companies' have been lawfully implemented in various places in the name of 'big data industry' or 'financial technology'.
Although the business model of these mines is beyond the supervision of the financial regulatory authorities, He Renzhi, chief researcher of Nuclear Finance, told Caijing that the current actual operation is led by the leading working group of the Internet Financial Risk Special rectification Office , A number of government departments involved in the administrative interventions, the intervention may be tax evasion, illegal electricity, fire safety, environmental indicators and so on.
The people close to the central bank also said that the regulatory authorities for the supervision of bitcoin and related industries, the logic of the main source of anti-money laundering.
It is learned that the central bank monitors the existence of money laundering mainly by checking the funds transactions in the escrow accounts of the banks.
In addition, the withdrawal of funds from the real economy and the high power consumption by the investment in the digital currency industry are also one of the factors that regulators consider to be tightened up, and the relevant leaders of the special rectification and improvement work group internally allocated bitcoin 'mining' enterprises Characterized as 'fake financial innovation' unrelated to the real economy.
Data released this week by the Bitcoin Energy Consumption Index show that the annual power consumption of bitcoin mining is estimated to be about 45.64 TWh (TWh), equivalent to 0.20% of global power consumption , Equivalent to the annual electricity consumption of a country of Iraq.
Yang Dong, a law professor at Renmin University of China, told Caijing's reporter that for now, the government is a "one size fits all" attitude and direction.
However, Yang Dong also said that it should not simply adopt a one-size-fits-all approach and should supervise the industry through a rigorous system of licensing such as licensing and the means of regulating science and technology. "However, current regulatory technology still can not control the flow of funds, so no This is not a long-term solution, and one should consider more effective regulation, "he said.
At present, legally speaking, virtual currency mines still belong to the market entities that are legally managed. In the view of He Zuji, most mining enterprises are enterprises that are normally registered according to the provisions of the industrial and commercial authorities and should not belong to the areas of financial supervision and regulation of electric energy It does not matter, he said, and local governments or power companies and mines signed contracts to be respected, to cancel the contract should also pay the appropriate price.
'Bitcoin mining industry, like all other industries that are not prohibited by law, is based on electricity contracts with electricity supply departments on the basis of electricity contracts that do not exist under civil contracts that are subject to equality The problem of administrative supervision. 'He told reporters the "Financial News."
But in the market view, strong regulation is not a bad thing.Many bitcoin mining practitioners told the "Financial" reporter, China's restrictions on the development of bitcoin in the country is actually good, and this trend is called ' Go to China. "
The logic behind this view is that the Chinese government's crackdown on the Bitcoin industry is conducive to stripping China of its future influence over the Bitcoin market, diverting the pricing power of bitcoin to countries with more market-friendly conditions.
To the sea, scattered, watching
Unlike the suspension of regulatory exchange for ICO and exchange currency in the "September Incident" of last September, the strong regulation of Bitcoin mining has dampened the market fundamentals. "The ICO ban in September did not move to the core core of Bitcoin, However, regulation of the mine will directly lead to a substantial increase in bitcoin costs. "A bitcoin mine owner told Caijing reporters.
It is understood that under the pressure of policies and costs, some mines have been closed down.Mining resources are increasingly tense, the fourth largest Bitcoin pool ViaBTC recently announced the decision to raise management fees on the 12th, from 6% increase of 50% .
According to the statistics of Blockcoin's block browser data, in the past month China accounted for about 46.28% of the global bitcoin accounting force, which is almost half that of the 80% domestically calculated power in its heyday.
Overseas transfer has become an option for large and medium domestic mines.
In the past couple of weeks, some Weixin groups in the currency circle have frequently screened screens to provide cooperation information for providing intermediary services to the mines outside the country.
'We have the resources to help the mine host to Quebec, Canada while bringing the managed mines together to mine and concentrate on mining in the form of a shareholding system and to later turn the stock company into a stockholder in Toronto.' A source who allegedly has first-hand resources overseas said.
At present, the five Central Asian countries, Eastern Europe, Southeast Asia, Russia and Canada are the major sea-going destinations in the country's mines.
The cost of transporting a mine to the sea varies from one individual to another, and a mine owner told Caijing that, in general, the cost of going to sea includes the cost of time, the cost of shipping and wastage of machinery, tariffs, and premiums on local electricity prices. Since local power plants are basically privately run, tariffs vary from individual to individual and are subject to commercial negotiations with each plant. "According to our survey in Southeast Asia, the overall cost is 60% higher than that in China."
Mining is a race against time.
The biggest cost is the cost of rebooting the machine from the machine to the floor. "The main trouble with the move was time, with a loss of roughly 0.6% of the total downtime." The mine owners told Caijing reporters.
Some head mines have started to work overseas, after Bloomberg reported that Bitkey co-founder Ng Han-han said in an interview that the company is building a regional headquarters in Singapore and mining operations in the United States and Canada The third largest mine, BTC.Top, is also under way, and the founder of ViaBTC, the fourth largest mine, said it has started operations in Iceland and the United States.
But most domestic mines are still on the sidelines. "There will be no big moves until the new, clear rules come out," said one mine owner.
'The real mass transfer has not started yet, it is before the tide,' said the mine owner.
Smaller mines can not afford the high costs and risks of going to sea, and decentralized miner mining is an alternative to exiting. 'How many units do you have?
According to "Caijing" reporter has learned that there have been risk-averse small mine owners, looking for other physical industries in the field and power resources, the layout of the mine therein.
Substitution, hosting, transformation
With the intensification of computing power, bitcoin mining more and more difficult, 'SIXO less porridge' makes the mining cost more and more low.According to a mine owner, the current average cost of digging a bitcoin has been Push up to 40,000 -500 yuan.
Converting coins is another way, with Ethereum turning over 130 times year-over-year as a more cost-effective alternative to Bitcoin, which is 10x more.
An etheric mine owner told Caijing reporters that digging for the CPU card mining machine used by Taiyuan Co is a through - loading machine, which can be deployed at any time according to market conditions and quickly switched to dig other currencies.
In addition, regulatory uncertainty risks, rising costs, and desire for a share of the production process demand, the birth of a new business model - the machine hosting and computer hosting.
The mine trusteeship is about to host its own mine to licensed and stable operation of the mine, to pay a certain amount of electricity and management fees. 'Now generally prices, and generally 0.6 yuan per kWh, high of 0.8 yuan.' This market Business model has rapidly matured to fully intermediary, you can choose to buy directly from the business of mining machine hosting, the whole do not have to transport their own mining machine.
More direct hosting, even without having to go through a mining machine, register an account and contract some of the mines in a corner of the world. The dug currency is converted into legal currency and is prorated to the power contractor.
Compared with the overseas transfer and custody of the curve to save the country, smarter players to choose the transformation, such as the industry's giant bit mainland China, has gradually transformed into a star chip company AI.
November 8, 2017, held in Beijing AI WORLD 2017 World Artificial Intelligence Conference, the mainland co-founder and CEO Jenn Group announced the AI brand SOPHON of bit Continental, as well as self-developed the world's first tensor accelerated computing chip (TPU) - BM1680. Officially enter the field of deep learning chip.
Based on the AI chip, the bit continent began its layout in the fields of big data, proprietary cloud and robotics in the industry, and by the end of last year, bitter mainland acquired the smart robot company Radish Technology specializing in children's education.It is understood that the bit-AI chip in mainland China started last November Bookings are currently sold out.
For the mine's source of funding, Wei Zheng, a senior investment manager at Origin Capital, said: 'Bitcoin mining is logically a traditional industry, where traditional venture capital and private equity are rarely involved.'
It is understood that most of the mines in the early are through personal or partnership investment, and now there are also companies to join in to scale the mine.In addition, some specialized investment blockchain funds also have betting mines.
But there are bitterly mainland companies such as head companies gaining access to traditional venture capital.According to IT Orange, BitTorrent was Sequoia Capital and IDG Capital of $ 50 million Series A round of financing on September 4, 2017, with equity participation Than 5%, investment valuation of up to 1 billion US dollars.
Attack on the mining machine and chips
Why China will become the mining industry upstream - the main battlefield of chip and mining machine production? Many insiders said that this is determined by the cost of China's terminal electronics manufacturing industry.
LIAO Xiang, CEO of Lightning Intelligence, told Caijing that China's bitcoin mining machines account for at least 70% -80% of the global market share, and one miners manufacturer said that their mine production orders have been drained to the second half of this year It's
The miners' producers told Caijing that the government's restrictions on mines in China have little effect on the sales of mining machines. "The industry as a whole has a serious shortage of production capacity and is a seller's market which needs to pay at least one full payment in advance Two months to get the machine manufacturers shipments last month, the average monthly output of about 30,000 units.
Dating back to the source of the cryptocurrency miners, which is also the core of miners' calculations, it has now entered the specialized era of CPU graphics and ASIC parallelism.
Among them, the CPU graphics card market also supply the original PC game industry and artificial intelligence chip industry.It is understood that the current global outsourcing CPU graphics card manufacturers only two, NVIDIA and AMD.
ASIC chip R & D is mainly bit continent, and recently because of the application for the listing of the new board broke the net profit of 2017 amounted to 300 million yuan Jia Nan Yun Zhi. Their research and development of the chip as the core of the mining machine is the famous ant mine Machine and Avalon miner.
In addition, the production of chip production is also subject to its upstream semiconductor production.
'The world can do the chip semiconductor manufacturers, the largest outsourcing is TSMC, followed by Samsung. Whether the program is independent research and development, have to find their films.' 'The mining machine manufacturers told the' Caijing 'reporter,' a lot of mining machine manufacturers In the grab capacity, and cell phones, computer makers robbed Apple is TSMC great customers.
The upstream of the semiconductor is affected by the production of high-precision industrial instruments and the capacity of raw material processing. According to the miners' manufacturers, it is difficult to increase supply chain production in a short period of time.
Lastly, as with all electronics manufacturing, after chip research and development, the SMD and complete machine designs in Shenzhen.
Shenzhen's terminal electronics manufacturing industry has once again become the center of the stage, clutching the lifeblood of the bitcoin upstream industry with low cost, rapid response capability and one-stop, efficient service.
The price of miners has also gone up, 'the original 7000 yuan mine machine now rose to 30,000 yuan', a blockchain venture capitalists told the "Financial" reporter, mining machine fair market price is generally considered In 2.5 million or so, the average cost of about 13,000 yuan, nearly 50% of the average industry profitability can not be without huge profits.
With the mining industry iteration accelerated, commercial competition in this area began to become fierce.Liu Xiang told "Caijing" reporter, at present it appears that the depreciation costs of mining machines in the cost of the higher and higher. 'Mining machine in the The arms race has been counting up, "said Cao Yin, chief strategy officer of the Energy Blockchain Laboratory.
"Unlike a few years ago, in order to reduce costs are used backward technology, and now the nano-technology used in mine chips, and even advanced than the mobile phone." The mining machine manufacturers said.'The industry shuffles too fast. ' He said.
The right to say pricing
The exact value of bitcoin mining in China is considered as a key issue for the Bitcoin mining industry in China.
Many people in the industry are bullish on the production of encrypted currency mining as the production side of the cryptocurrency market, meaning for the national strategy. Cao Yin told Caijing that bitcoin itself is already a financial asset. Just like oil, the pricing power depends on the place of production And the exchange. "The Bitcoin mine, the site of bitcoin, is an important part of China's future bid for global digital assets."
"Pricing is very important and traffic can become a globally recoverable asset for national strategies," said a technical lead at a blockchain project.
According to Zou Chuanwei, a Mason Scholar at Harvard, the so-called bitcoin pricing itself may be a false proposition under the current asset bubble.
He believes that the production costs of graphics cards, mining machines and mining operations may not be as big an impact on the pricing of bitcoin as the market generally thinks.
Zou Chuanwei said Bitcoin as the representative of the cryptocurrency as the first real global asset bubble, the price driven by speculative activities, but also by the behavioral finance studies of individual and group irrational behavior; followed by liquidity The impact of premiums, including the expansion of trading places and the diversification of trading instruments.
Wang Liren, a senior researcher with the China Blockchain Research Coalition, also believes that mining affects costs, but costs do not determine prices. Bitcoin prices are ultimately determined by supply and demand.
Global node distribution platform Bitnodes data show that as of January 31, the global bitcoin network has a total of 11727 nodes, of which 3172 nodes in the United States, accounting for 27.01% of the global total, followed by Germany followed by China ranked third , Accounting for 7.09%, while in July last year, the total number of nodes in China nearly doubled that in Germany.
Although many industry insiders do not directly attest that China is losing its right to bitcoin pricing, China's activity is indeed declining due to the fact that the entire node records the real-time activity of the entire blockchain network.