In August of last year we took an unusual look at Bitcoin mining, exploring the corridors and anecdotes of one of its mines in northeastern China. The people at Motherboard traveled there in October to film their activities, and why not share the human side of Bitcoin mining, talking with those in charge and learning their views on the future of the cryptocurrency.
Dalian's Bitcoin Mines
In Dalian, northeastern China, there are six Bitcoin mines. In October of last year, these six mines generated just over four thousand Bitcoins per month, surpassing one and a half million dollars in earnings. The mines concentrate three percent of the processing power registered on the Bitcoin network. And yet, today there are many doubts. On the Web, basically people are lining up to declare that Bitcoin is dead, and that the loss of 70 percent of its value is the greatest proof. However, that is not the opinion of Jin Xin, the administrator of one of the mines. Jin Xin explains that the instability of the currency corresponds to its current stage of development. Bitcoin is still “in the mining phase”, and the variations in its price are nothing but growing pains. Fifty percent of Jin Xin's wealth is in Bitcoins, and the Motherboard video below shows us that he does not seem to be doing badly.
Jin Xin takes care of almost everything in mine number one of Changcheng, in Dalian. Employees, equipment and electricity are his responsibilities, but he is not alone in his Bitcoin adventure. In total, the group consists of four people, all of them “shareholders” if you want to call them that. When difficulty was lower, Xin and his friends were able to generate about one hundred Bitcoins a day in each of their mines. Currently, each block rewards 25 Bitcoins, but this will remain so until mid-2016, when the reward will drop to 12.5 Bitcoins, repeating that division every four years.
We must also add the electricity costs. Jin Xin reports about 80,000 dollars a month (October 2014), which indeed makes us wonder how profitable the process is today. Despite this detail, we see that both Xin and Xia Yu, one of the technicians working there, are optimistic. In fact, Xin believes that Bitcoin is the future, and although it will not replace the current financial system, it is the system itself that follows the direction of Bitcoin, with more digital options and electronic payments.
Motherboard
