Huaqiangbei boss tearfully sells off graphics cards? Is the mining industry doomed this time?

Original title: Huaqiangbei boss tearfully sells off graphics cards? Is the mining industry doomed this time? Source: Worldchain Finance

After the market downturn, the decline of Bitcoin, and the tightening of regulations, the cryptocurrency industry is now in a trough. The mining field, which is closely linked to the cryptocurrency market, is naturally no exception.

Faced with today’s sluggish situation, we can’t help but wonder how popular the mining industry was in the past.

Because there were too many miners and mining companies rushing into the mining field, the mining machines, hard drives, graphics cards and other electronic products needed for mining were once sold out. Graphics cards in particular were in a state of "hard to find" for a long time.

But now the situation has taken a sharp turn for the worse. Electronic products, such as graphics cards, are in serious trouble. Even if the price is cut in half, no one is interested in them. They have gone from being hot and in-demand products to being long-stocked and unsalable products. And this huge change from heaven to hell took only half a year.

Huaqiangbei, as the leading electronic product distribution center in Shenzhen and even across the country, has also witnessed this change.

Those days when graphics cards were hard to come by are finally a thing of the past.

Nowadays, it is really hard to associate the desolate state of graphics cards today with the "hard to get one" situation a few months ago.

A few months ago, in Huaqiang Electronic World in Huaqiang North, the packaging boxes of many popular graphics cards were placed in the most conspicuous position. But in fact, these boxes were empty. It is difficult for store owners here to get goods, and even if they do get goods, they will be reserved early.

At that time, graphics cards were undoubtedly in short supply.

The reason why graphics cards are so scarce is closely related to the centralized procurement of mining giants at that time. At the end of last year, Ethereum completed the 2.0 level transformation. In addition, since the beginning of last year, the price of ETH has been rising all the way, and the increase has even reached 300% at one point. If you want to catch this ride, you must perfectly match the upgraded ETH. Therefore, miners must introduce more comprehensive and powerful mining hardware.

As we all know, mining is to obtain a certain amount of coins by consuming CPU computing time and electricity in a similar way to how gold miners consume resources. The CPU is the brain of the computer, and it requires a large storage unit for easy and fast access, as well as a more powerful control unit and a computing unit that can perform various complex types of calculations.

Mining itself is a "hard job" that requires a lot of calculations but the calculations themselves are not complicated. Graphics cards can do a good job of calculating pixels, which is a "simple but large amount". For this reason, graphics cards have replaced CPUs in the new round of bull market and have taken the C position.

However, the market of the cryptocurrency circle is always changing rapidly. There is no need to go through the long wait of "30 years in the east, 30 years in the west". In just a few months, the status of graphics cards and related mining electronic products has undergone earth-shaking changes.

The national policy has been tightened across the board, and the prices of "essential mining products" have fallen precipitously

In July this year, the 5th and 6th floors of Huaqiangbei SEG Plaza were much quieter than before. These two floors have always been mainly engaged in mining machines, hard drives, graphics cards and other electronic products needed for mining. Before this, this place has always been crowded and extremely lively.

Just over a month ago, an enterprise-level 16T hard drive could be sold for 5,300 yuan. Despite the high price, hard drives were often out of stock and had to be ordered in advance. Today, the price of the same 16T hard drive has dropped to around 2,000 yuan.

The price of P-disk servers, which are also used for mining, has also plummeted. In May, a top-end P-disk machine cost more than 80,000 yuan, but now it costs only more than 40,000 yuan.

Graphics cards, which have always been considered to have strong prices, have also been hit hard this time, with overall prices falling by 20% to 30% compared to before. Among them, the price reduction of second-hand graphics cards is relatively large. According to industry quotations, the RTX 3060, which originally cost 2,499 yuan, is currently priced between 2,400 and 3,000 yuan in the second-hand market, and the price was 6,500 yuan two months ago; the RTX 3070, which originally cost 3,799 yuan, is currently priced between 4,100 and 5,000 yuan in the second-hand market, and the price was 8,500 yuan two months ago; the RTX 3080, which originally cost 5,499 yuan, is currently priced between 5,700 and 6,500 yuan in the second-hand market, and the price was 12,000 yuan two months ago.

The reason for the sharp drop in prices is naturally closely related to the tightening of national policies and strengthened supervision in the mining field. On May 18, the China Internet Finance Association, the China Banking Association, and the China Payment and Clearing Association jointly issued the "Notice on Preventing the Risk of Virtual Currency Trading Speculation", which fired the first shot in the comprehensive regulation of virtual currencies.

Affected by policies and environment, many mining bases in Inner Mongolia, Qinghai, Sichuan, Hefei and other places have been shut down since June this year. In addition, the market of cryptocurrencies represented by Bitcoin is bleak and has plunged sharply. All these unfavorable news seem to indicate one thing: the withdrawal of mining from China is a foregone conclusion.

From being priced but not sold to no one interested in buying, offline entities have also suffered a blow.

The "hard to find graphics cards in the mining circle" was once a hot topic, and it was even so popular that it spread beyond the circle and even affected offline. Many digital enthusiasts and game enthusiasts had to give up buying graphics cards because the prices were too high at that time.

Now, affected by market conditions and policies, the prices of these electronic products have "returned to normal" again, but even though the prices are very affordable, there is still no one to buy them, and the related offline physical industries have been greatly affected.

The first to be affected are the mining machine service providers. When the market was hot, the price of a high-end mining machine ranged from hundreds of thousands to tens of thousands; the price of a graphics card ranged from thousands to tens of thousands, and the mining machine service providers could easily earn hundreds of thousands or even hundreds of thousands in a day. But now, these service providers have to face the embarrassing situation of "zero income in a day".

Many stall owners who sell graphics cards are still struggling to keep their business going, while those small vendors who believe in virtual currency and do part-time mining have long disappeared. Some have even moved back to their hometowns.

Consumers' reactions to this wave of price declines were also very flat, and could even be described as indifferent. Some game enthusiasts even said, "When the seller breaks his word, the transaction is just a game between 'gamblers'. Who knows if the graphics card you bought has been used for mining? Now some small factories do a good job of dust removal and packaging, and it looks like a brand new one." Some people even said bluntly, "Most of those who didn't buy graphics cards before are waiting for the next generation 40 series graphics cards to be released. In this situation, anyone who buys is a fool."

It seems that when the supply and demand relationship changes, the entire market will undergo earth-shaking changes.

The changes in the cryptocurrency world are like the first domino to fall, followed by a series of collapses.

We have no way to stop the direction and development of things, we can only make adequate predictions and analysis before things start. As I said before: There are risks in the cryptocurrency circle, so be cautious when investing.