The largest manufacturer of Bitcoin mining equipment, Bitmain, suspends the sale of its products due to pressure from Beijing.
In recent days, the Bitmain company suspended the sale of the ASIC devices that it manufactures. The pressure from the Chinese authorities on cryptocurrencies led them to make such a drastic decision. In Beijing, the measures against the trading and mining of cryptocurrencies within the territory intensified.
For that reason, the company specializing in equipment to generate cryptocurrencies stopped its commercial activities. They argued that they wanted to reduce selling pressure in the secondary market due to too low prices. Since everyone wants to get rid of used equipment, prices have reached the bottom.
Bitmain is not the only manufacturer of that type of equipment that the selling pressure in the secondary market is affecting. Other major Chinese manufacturers that are suffering from this situation are MicroBT, Canaan Creative, and Ebang.
Reasons why Bitmain Suspends the Sale of Mining Equipment
The suspension of the sale of mining equipment by Bitmain could lead to three conclusions. First, the company fears retaliation from the Chinese authorities for selling products related to cryptocurrencies. Second, the fall in the prices of ASICs in the secondary market has caused their sales not to generate profits.
Another conclusion is that both reasons forced the manufacturer to make that decision. What is true is that the company will not offer new products indefinitely. Therefore, miners in other countries will have to settle for used equipment.
The reality before Bitmain’s decision was not much different from that of today. Stocks remained empty due to orders from large mining companies and a shortage of semiconductor chips.
What has caused great commotion is the fall in the prices of mining devices in the secondary market. The authorities will apply exemplary punishment to those mining cryptocurrencies, which has forced the owners to sell them cheaply. Suspending the sale of products is only part of a bigger problem.
China Takes Strong Measures Against Bitcoin Mining
In May, the Chinese government decided that Bitcoin mining was against the country’s environmental plans. They argued that the business was damaging the environment with CO2 emissions, so they decided to ban it.
In June, the central government began the offensive, ordering the provinces to close all companies related to mining farms.
At the same time, the authorities summoned financial institutions to monitor their users. They sought to prevent any account from becoming involved in the purchase and sale of cryptocurrencies.
All of that forced Bitmain to suspend the sale of cryptocurrency mining machines. Representatives of the company said that the decision aimed to help avoid any problem.
The tightening of anti-cryptocurrency measures in China has also affected other businesses. For their part, cryptocurrency exchanges and pools have also closed their operations or have reduced them to a minimum.
The Chinese government does not accept the decentralized and anonymous nature of Bitcoin, which led it to create its CBDC. Besides, they argue that mining this cryptocurrency contributes to harming the environment as many farms use fossil fuels.
By Alexander Salazar
