The coronavirus outbreak in China may impose a longer-term impact on the bitcoin network’s mining activity at a time when an estimated 65 percent of its computing power is located there.
While Chinese miner manufacturers see rising demand for new equipment ahead of bitcoin’s scheduled halving in May, they estimate the disease may limit growth in bitcoin mining power if the situation isn’t resolved in the near future because it is difficult to expand or build new machines, according to Kevin Shao, general manager of Canaan Creative’s blockchain arm.
Shao told CoinDesk that while there is little doubt miners can maintain the current level of computing power, there is a shortage of new mining machines.
So far, almost every bitcoin miner maker in China – Bitmain, Canaan, MicroBT and InnoSilicon – faces delays in production and delivery. Bitmain and Canaan, the world’s top two miner makers by market share, have published notices saying the delay of after-sale services until Feb. 10.
Customers want new, top-of-the-line mining models to expand existing mining facilities and replace older machines in anticipation of the bitcoin halving, currently expected to occur sometime in May 2020.
“One of the most affected businesses is our mining machine production,” Abe Yang, chief operating officer at PandaMiner, told CoinDesk.
Founded in 2013, the Shenzhen-based firm makes mining machines and provides computing power services with nine mining farms.
“Not only us, most miner makers have been affected by the outbreak since their factories are based in cities like Dongguan and Shenzhen in Guangdong province,” Yang said. “During the extended vacation until Feb.10, almost all the production will be halted.”
Meanwhile, the lockdown of the city of Wuhan has had a more direct impact on InnoSilicon, whose headquarters is located in the outbreak’s epicenter.
“The delay currently has not affected our businesses that much since the extension [of the holiday break]…