Since the Bitcoin crash, many miners, particularly in China, have abandoned operations as the cost of equipment and electricity have rendered it commercially unviable.
But Mongolia has seen a rise in mining activity thanks to its equipment-friendly climate – capital Ulaanbaatar shares the rank of the world’s coldest capital city with Moscow in Russia, Ottawa in Canada, and Kazakhstan’s Astana.
Yuma Furubayashi, CEO of Ginco Mongol, told Nikkei Asian Review: “The business environment is increasingly harsh, but we can still produce a profit.”
The trend is helped by the government, which is keen to nurture an industry that can operate when the biting weather slows mineral mining, agriculture, and tourism.
The Bitcoin crash hit China hard, with reports of miners selling equipment by the kilo after going broke.
Earlier this month, Coin Rivet spoke to a leading blockchain consultant who said mining will continue to be profitable at scale.
Christian Richards, director of business development for blockchain and mining operations for the Canadian Fibre Centre, says the peak in the price of cryptocurrency in December 2017 led to “regular and retail ghetto crypto miners in their basements and garden sheds mining.”
But the “biggest drop in cryptocurrency price means for so many it is now uneconomical.”
Richards is in touch with “large-scale miners” and says it remains profitable at scale and will continue to be profitable going into 2019.
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