Bitcoin’s recent price surge has caused a significant increase in the cost of mining equipment, particularly in Shenzhen’s Huaqiangbei district, which is known as a global hub for crypto hardware. According to a report by Wen Wei Po, the price of the Antminer S21 335T mining device has risen to $5,600, or approximately RMB 40,700. This marks a 30% increase from last year’s price of $3836.19, which was equivalent to 28,000 RMB. The demand for the Antminer S21 XP, a mining device with water-cooling facilities, has been even higher, leading to stockouts on Bitmain’s official website.
Merchants in Huaqiangbei have reported a surge in bulk orders, with buyers from countries like Russia, the U.S., and Canada purchasing hundreds or even thousands of units. The increasing demand for mining equipment is driven by the rising price of Bitcoin (BTC), making mining operations more profitable despite the inflated costs of equipment.
Hong Kong has emerged as a crucial export hub for mining equipment following China’s ban on cryptocurrency mining in 2021. The free-trade environment and efficient logistics in Hong Kong have made it a preferred destination for redirecting mining machine transactions. Most new mining equipment is exported through Hong Kong, taking advantage of its status as a way station for international trade. Cross-border logistics services ensure quick delivery of mining machines to Hong Kong, from where they are further transported via air and sea to domestic and foreign markets.
BTC mining difficulty recently reached an all-time high in the $100K to $108K price range. The mining difficulty adjustment at block height 874,944 saw an increase of 4.43%, reaching a record high of 108.52 trillion, as reported by TheMinerMag. The network’s average hashrate in the last 14 days reached 771 EH/s, with the seven-day moving average exceeding 800 EH/s. This surge in hashing difficulty and decline in hash price illustrate the broader impact of BTC’s price surge on mining economics. The hardware shortages and price hikes underscore the intense global competition among miners.
Despite the explicit ban on mining activities in mainland China, the legal framework in Hong Kong allows for the sale and export of mining hardware, providing merchants with an avenue to meet the growing global demand. This shift in mining equipment transactions to Hong Kong highlights the evolving landscape of the cryptocurrency mining industry and the adaptability of market participants in response to regulatory changes and market dynamics.