Opinion: institutions have collapsed on the bitcoin market.

A „collapse“ has formed in the market for bitcoin extraction equipment – there is demand and no supply. Dmitry Ushakov, Commercial Director of the BitRiver data centre, told Forklog about this.

„It is worth clarifying here that manufacturers cannot meet the demand for their top models,“ he said.

According to Ushakov, sharp purchases of equipment in large volumes can be explained „only by the arrival of large, institutional investors interested in S19 Pro, M30S++\M30S+ and other top models“.

He emphasised that their business model involves long planning horizons:

„As a result, they are ready to ‚hold‘ the crypt currency, not sell it, covering the costs of mining, but wait for growth. This reduces the pressure on BTC costs. The previous generation’s miners simply do not meet their criteria“.

Ushakov also noted that the American company Core Scientific has put additional strain on manufacturers. In June it signed an agreement with Bitmain to purchase almost 17,600 Antminer S19 units.

Production capacities of suppliers of mining equipment are loaded until the end of 2020, and for some – until February 2021, says Ushakov.

„Of course, it is possible to supply previous-generation equipment, but how long it will remain profitable is not known,“ he said.

The expert added that today it is risky to invest large sums of money in such miners:

„Especially given the speed at which the ‚old‘ park is being upgraded and replaced by top models“.

Ushakov stressed that the current situation on the market disproves the opinion that the mining „is becoming a thing of the past“:

„The market deficit shows the opposite – high, unsatisfied demand that follows the supply, which shows latent potential, development opportunities and the ability to increase in volume.

Ushakov summed up the potential of the market and the gradually increasing infusions from institutional investors:

„Before closing the borders, we saw an increase in the number of bids from such investors.

The Chinese media previously reported that Bitcoin miners were facing a shortage of equipment.

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