China’s top crypto-mining hardware-maker reportedly furloughs staff • The Register

The world’s largest source of hardware designed for the task of mining cryptocurrency, Beijing-based Bitmain, has reportedly furloughed staff after disappointing sales.

Bitmain’s Antminer boxes – which employ application-specific integrated circuits (ASICs) tuned for the job of mining crypto – are thought to command 75 percent of the market for such hardware.

But according to reports in Chinese media, the manufacturer has reduced staff levels after dire September financials produced red ink.

The Register has seen a screenshot of a purported internal Bitmain message that states cashflow recovery in September was not satisfactory, and some business units continue to underperform.

That situation has made furloughs necessary for at least September – with a decision to be made on October employment last weekend.

In August 2022, the time of Bitmain’s last English language blog post, the biz posted news of a reward scheme for loyal customers who paid for orders placed before the so-called “Crypto winter” – which saw prices for common cryptocoins crash and investors cool on the instruments after events like the collapse of FTX and TerraLuna. Bitmainy continued to promote a loyalty scheme for long-term customers that offers greater rewards for larger orders.

Perhaps those schemes haven’t done well enough of late.

With former FTX boss Sam Bankman-Fried on trial, nasty news about crypto will be hard to escape for weeks to come. Bitcoin, meanwhile, trades for around $27,600 apiece at the time of writing – down from a June 2023 high of over $30,000 and well below the $61,000-plus price from late 2021. Ethereum’s November 2021 peak of $4,600 has seldom been sighted since: it now sells at $1,584 apiece.

At those prices – and with energy costs high thanks to Russia’s illegal invasion of Ukraine – it’s not hard to see why would-be miners aren’t filling in purchase orders for ASICs and using express couriers to speed them to Bitmain.

For what it’s worth, Bitmain tried to diversify beyond crypto. In 2017 it told Quartz of its plans to get into the AI business.

That appears not to have happened, leaving Chinese workers out of pocket and facing uncertain futures – a status shared by plenty of crypto investors. ®