Bitmain Set to Deploy $80 Million Worth of Bitcoin Miners, Sources Say

The Takeaway Bitmain is planning to deploy 200,000 units of its own mining equipment in China to take advantage of cheap hydroelectric power this summer.

The equipment is conservatively estimated to cost $80 million, but it may be more profitable right now for Bitmain to mine crypto itself than try to sell all this inventory.

The S9j and S11 retail for $400 and $500 on its website, respectively, so 200,000 units of those models would be worth around $80 million to $100 million if Bitmain could sell all the inventory.

While it's unclear what electricity deal Bitmain can get eventually, mining farm operators said the cost in the summer on average is around $0.037 per kilowatt hour.

Last year, amid an overall cryptocurrency market slump, more than 600,000 bitcoin miners were estimated.

Of Bitmain's hash rate disclosure blog, on Oct. 9, 2018, all Bitmain-owned hardware that was mining the SHA265 algorithm-based bitcoin generated a hash rate of about 2,339 quadrillion hashes per second.

To 1,692 PH/s, implying, under the same assumptions, that the company unplugged about 50,000 miners over the past several months and had around 120,000 sets of equipment running in early March.

The hash rate of the bitcoin and bitcoin cash networks on that date was about 44,973 PH/s and 1,500 PH/s, respectively, meaning Bitmain's proprietary mining contributed around 3.6 percent of the SHA265 algorithm-based networks' combined computation early this month.

It could climb up to 70 quintillion hashes per second, above the network's all-time-high around 60 EH/s, because of the new investments being made by Bitmain and other miners.

As of June 30, 2018, Bitmain had opened 11 mining farms located in Sichuan, Xinjiang, and Inner Mongolia with an aggregated capacity to store about 200,000 sets of mining hardware.