MicroBT, a bitcoin mining unit manufacturer has steadily expanded its market share by selling at least 500,000 units in 2019. As the manufacturer increases its production, it is simultaneously chipping away at Bitmain’s dominance.
The latest reports reveal that MicroBT sold almost 600,000 units of its WhatsMiner M20 series last year. Speaking in an online panel that was hosted by the Chinese mining pool Poolin on February 13 in a WeChat group, the sales head of the Shenzhen-based company, Vincent Zhang, said that their flagship unit was a success.
These products produce a computing power of almost 60 terahashes per second (TH/s) averagely. Hence, the newly delivered 600K units may have already contributed at least 30 exahashes (EH/s) of hashing power to the bitcoin network last year. (1 EH = 1 million TH).
The network’s two-week average computing power increased by more than twice from 40 EH/s at the end of 2018 to almost 100 EH/s in December amidst Bitcoin’s price jump throughout 2019. Thus, equipment delivered by MicroBT could be responsible for nearly half of Bitcoin’s computing power growth in 2019.
Zhang never specified the exact average unit price of the flagship unit batches. He resisted from commenting on the price since it could fluctuate depending on Bitcoin’s price over the entire year. Nonetheless, the firm’s different models in its M20 product line are normally priced between $24 and $30 per terahash.
It means the firm has brought home high 9-figure revenue in the US dollars for last year. Bitcoin’s computing power has reached around 110 EH/s currently. Therefore, it means that MicroBT may account for almost 30% of bitcoin mining power sold in the current market. That makes it one of the biggest and fastest-growing miner makers globally.
In the meantime, Bitmain’s dominance of sold bitcoin hash rate was around 65%, as estimated in a December 12 Coinshares report. That represented a dive from 75% recorded in 2018. However, the report may be a little bit outdated since bitcoin’s computing power has from that time grown by 20%. It has increased from 92 EH/s in mid-December 2019 to almost 110 EH/s today.
The Hangzhou-based maker of the Avalon miner, Canaan Creative, estimated in its initial public offering (IPO) that it accounted for almost 20% of bitcoin computing power that was sold in the first half of 2019. The firm went public in the United States in November 2019, but it is yet to release its full-year results.
But, although there is increasing competition, Bitmain’s mining equipment still dominates the current market. That has resulted from the successful sales of its AntMiner S7 from 2015 to 2016, followed by the S9 model between 2017 and 2018.
During Bitmain’s IPO filing in September 2018 in Hong Kong, the firm reported that it delivered almost 500,000 bitcoin miners between 2015 and 2016. An additional 3 million units were sold from the start of 2017 to June 30, 2018, as the crypto Bull Run continues.
Halving Is Imminent
While S9s, which deliver an average of 14 TH/s computing power is the most popular among miners, they still face an increased risk of becoming obsolete with the BTC halving fast-approaching in May. The halving will reduce bitcoin’s mining rewards from 12.5 per block to 6.25.
Reports from earlier this month said that mining farms have been procuring the most powerful and latest miners to expand all their facilities. They can also replace the older models as they prepare for the upcoming halving event.
Although Bitmain produced its latest AntMiner S17 series in 2019 to rival MicroBT’s WhatsMiner M20, the latter is way ahead regarding mass production and shipments. For now, the two firms are also racing to deliver more powerful machines this year. They aim to produce the AntMiner S19 and WhatsMiner M30 in 2020.
But, the real production quantity of these products majorly depends on the supply of wafers from different semiconductor companies, including TSMC and Samsung. The wafers are ‘very limited,’ according to Zhang.
The outbreak of this virus in Wuhan China has delayed the manufacturing and logistics of these mining machines. Hence, Bitcoin’s computing power growth has somewhat stagnated currently. Data obtained from mining pool BTC.com approximates that bitcoin’s mining power is expected to reduce by 1.78% in around eight days.
MicroBT has resumed its production, as stated by Zhang in the WeChat group. He explained:
“Currently, part of the logistics has also gone back to work. … So now, the supply of miners is not a big issue, but not every mining farm is physically accessible. The large scale of investments may be affected because investors may not be able to do physical due diligence on facilities.”
With many events scheduled to take place in the crypto world his year, it remains to be seen where Bitcoin mining and the miners will head to.