Bitmain Freezes Bitcoin Mining Project In Texas
Bitmain Technologies is freezing its plans to build a mega Bitcoin mining plant in Rockdale, Texas. The news is that the Bitcoin mining powerhouse begins to reduce the magnitude of its operations and the employee headcount.
Bitmain suspends its plans to install a $500 million crypto-mining and data hub in Rockdale, according to Texas Public Radio (TPR).
Commenting on the report, Milam County Judge Steve Young said:
“I’m really disappointed because we had advertised this. We had waited for this and had wanted this. We had welcomed this. This was huge. We need some positive news here and some jobs here. We need a tax base here, and this was a step in the right direction.”
By the middle of 2018, the company decided plans to install one of North America’s largest Bitcoin mining centres. Bitmain informed at that time that the new mining facility on the Alcoa aluminum smelting site would start business operations in 2019 and even employ 500 people.
For Young, the latest news is yet another blow to a place that struggles to lure investment to the domestic economy. Dave Barkemeyer, a former Milam County Judge, asserts that in the past decade the county has probably lost some 30% of its tax revenue.
According to the news release, Bitmain is yet to give an official statements on the issue. However, a company spokesman indicated that Bitmain is taking steps to shrink its operations in the United States.
According to an email message received by Young,
“The right-sized team at Rockdale now has the expertise to re-start the project at small scale anytime. Bitmain would like to ramp up the site at a slower pace and scale based on market conditions.”
Young points out that Bitmain has already made tremendous progress in the facility, with roughly 8,000 servers worth millions of dollars installed on site.
In the meantime, the firm continues to hit headlines for bad reasons including employee layoffs in several departments. The company is slated to receive a new CEO as the co-founders have stepped down from administrative responsibilities.
Bitmain has already booted several employees from its R&D and Bitcoin cash development departments since December 2018. Reports suggest that the company recorded losses to the tune of $700 million in Q3 2018 alone due to its bet on Bitcoin Cash, which has dropped to $126,350, in addition to the sharp drop in cryptocurrency prices.
Bitmain losing dominance = more decentralisation
– Laying off 50% staff (reported)
– Mining pool dominance down 28% in last 6 months
– Poor bet on BCH at the cost of losing BTC
– Lost key chip designer
– ASICs losing competitive edge
– Growing competition (Canaan, Halong, Ebang)
— Misir Mahmudov (@misir_mahmudov) January 8, 2019
Consequently, once the undeniable behemoth in the Bitcoin mining domain has slowed, with erosion in its monopoly. Back in mid-2018, the company’s mining pools, BTC.com and AntPool, controlled nearly 51% of overall BTC mining hashrate. Both pools currently account for 24%.