When Bitcoin and altcoins were on a bear market, specifically from the middle of November 2018 until just a couple of months ago, the industry endured the consequences on several fronts. Among the most widely affected entities were the mining equipment sellers, for a natural supply and demand setting.
People lost interest in mining cryptocurrencies, most specifically Bitcoin, because for a few months if was not as profitable as, say, the end of 2017 and the beginning of 2018, a moment in time in which BTC reached an all-time high of nearly $20,000 regarding its price. It was still worth the investment and effort, just not so much as before. However, sales of mining equipment and hardware fell dramatically, forcing several companies to close or to perform massive cuts when it comes to personnel and expenses.
The Bulls Have Taken Over
Now the tables have turned once again, this time for the bulls. Bitcoin has surpassed $10,000 for the first time since January 2018, even approaching $12,000 in the last few hours. The industry seems revived, and experiencing an evident revival. And, not coincidentally, the sales of mining equipment have not only returned to customary levels, but it is currently outstripping supply.
Some of the most notable bitcoin mining hardware brands were forced earlier in the year to significantly lower the prices on some of their products because the supply was significantly more than the demand. Thanks to Bitcoin’s surge, however, that is no longer the case.
Now, companies have ever-growing pressure to manufacture enough machines to meet buyer’s demands. Quoted by a prominent specialized crypto site, Steven Mosher, currently the Head of global sales and marketing at Canaan Creative (the manufacturer of the Avalon miner) stated that “the surge in bitcoin resulted in increased demand and supplies were already short.”
A Return to 2017 Levels
Mosher essentially confirmed that the industry is returning to the levels in which BTC reached its all-time high in value. The executive did not, however, reveal the precise company’s order volume.
“The current state of the industry is that inventories are down and demand is high. It looks like a return to the 2017 Q3, Q4 conditions, where demand was three times the supply.” It is safe to say that mining equipment manufacturers have plenty of work to do, as the industry stabilizes and cryptocurrencies continue to earn value.
A Growing Trend
Experts in the crypto community have stated that Bitcoin’s price will keep going up in the next few weeks, at least, and forecasts for the long-term are awfully positive, as well. Some have even said that the world’s premier digital asset will approach $60,000 in the not so distant future.
According to recent data, the average payback period for the majority of the mining equipment in Q2 has decreased from 60 to 150 days, a fall from a figure that was in the range of 120 to 280 days.
Canaan Creative is surely taking advantage of the current circumstances and has already launched its newest “toy.” The world met the AvalonMiner 1041 in May. It can, allegedly, compute a maximum output of 37 terahashes per second (TH/s,) at 2,361 watts per hour of energy consumption.
By Andres Chavez