Posted 8 months ago | by Ben Armstrong
Crypto Mining Race – Will New Players Make Changes?
The influence of China in the crypto mining space is undeniable but as more businesses jump into this lucrative industry, it’s impossible to know who will end up on top.
In a recent statement, Taras Kulyk, Senior Vice President of Blockchain Business Development from Core Scientific said that there's fierce competition among the countries for the leading position in the mining industry.
Each of them has a potential package to offer to crypto miners.
Speaking with media, Kulyk also noted the global volatility of hashrate has increased through the fact that countries around the world are pursuing control over the crypto mining industry.
China Want to top Miner – Sort Of...
China is still high on the list of crypto miners – despite the fact they are illegal in the nation. The country has been well-know for competitive advantages, particularly low labor costs, access to machinery and lower energy costs during the rainy season.
“One key economic concern driving recent crackdowns by authorities is theft of power which local politicians then have to clamp down. Another key economic concern driving regulatory uncertainty is capital control issues. Both of these have made the current regulatory environment in China uncertain for digital mining companies.”
As political turmoil has increased across the globe, there is a proportionally higher risk of existing operators limiting capital expenditure, and in the worse scenario, shutting down and relocation comes as proper perspectives.
According to Kuryk, the crypto mining industry, "...is extremely capital intensive, meaning that operators require stability over long periods of time to ensure their deployed capital recoups and provides an ROI."
New Laws are Creating Changes
Discussing the effect of new regulations on competitiveness in particular countries such as Iran, Ukraine, Canada and Kazakhstan.
“Generally, we’re seeing the regulatory burden for digital mining easing off, as it’s increasingly viewed as a way to reinvigorate sunset industry assets into being useful in the technology 2.0 economy. Governments are turning to their regulatory policy, particularly making their policy more favorable to mining, in order to gain competitive advantages over other players in the mining industry.”
The fact that regulation is affecting crypto-mining is the key factor to, “see institutional investors allocate portfolio room to leaders in the space.”
Kulyk came to the conclusion that,
“The stronger the leadership team and transparency around ownership and operations, the more likely a company will be a target for investors who are looking to get involved with digital mining.”
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