Bitcoin Miners Hold Onto Rigs, Betting the Bull Run Will Continue
Some bitcoin (BTC, -0.89%) miners are sitting on their mining rigs in the hopes of selling them at a higher price as bitcoin’s rally continues.
“I know there is supply available,” said Vincent Vuong, director of sales and procurement at bitcoin mining and hosting company Compass Mining. “I talked to a lot of people. They all have thousands of units but nobody is willing to sell them.”
China’s crackdown on crypto mining sent mining rigs’ prices plummeting a few months ago, but the machines are now trading at a premium thanks to bitcoin’s recent bull run.
In recent weeks, bitcoin has seen some of its largest gains this year, boosting sellers’ confidence in the machines’ prices in the future.
Mining machines manufacturers like Bitmain and MicroBT allow their clients to pre-order the rigs and hold futures contracts for batches of machines that will be delivered on a predetermined future date.
Early this week, bitcoin recrossed above $50,000 and has been logging gains for five consecutive weeks, which marks its longest weekly winning streak in nine months.
Trading mining rigs has become more strategic over time. Vuong even suggested that someone trading hardware might have been able to make more money than actually buying and holding bitcoin itself.
Even in the short-term bearish market, some sellers are opting to wait it out by running their mining machines on a hosting site. Doing so can generate daily profits, which can buy them more time while they wait for the bear market to pass, Vuong said.