Bitcoin mining ban is an easy move for China, says Bitmain partner EMEA

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Two weeks after a 15% rise in electricity prices in Turkey, a new professional mining equipment store opened in Istanbul, the country’s business center, on Tuesday.

Opening a mining equipment store in a country where electricity is expensive seems counterintuitive. But Phoenix Store, Bitmains’ business partner in the Middle East, did the math before opening its second store in the region. Phoenix Store CEO Phil Harvey explained that the main goal of the business with the Istanbul store is to educate the crypto-friendly Turkish population on crypto mining. Then customers can purchase mining equipment and hosting services that would work in Canada, the United States, or Russia. Mining in Turkey is simply impossible.

It’s like you want to invest in a gold mine, he said, you can come here and invest in a gold mine, but it won’t be in the back garden. It’s going to be outside.

Cointelegraph Turkey spoke with Harvey after his presentation to learn more about the crypto mining landscape in the wake of China’s crackdown on mining operations.

China must maintain its current growth for projects in the country, Harvey began, detailing the crackdown. The country is required to improve several areas, such as reducing its carbon footprint, to obtain financing from the International Monetary Fund or the World Bank:

The easiest industry to shrink overnight was a gray area industry. Some 68,000 gigawatts of power were instantly taken out of China simply by saying no to Bitcoin mining.

It’s a significant source of income, but even that would be paltry compared to what the IMF or the World Bank is investing in China for projects like road initiatives. So it was an easy decision for China to remove these miners and reduce their carbon footprint, Harvey added.

While several miners have announced that they will be moving to cold climates like Canada, Harvey believes half of what is lost to the Chinese crackdown will never get back online:

Because these are older machines that were in a warehouse for many, many years and were only doing 5% to 10%, and they were on. But it doesn’t make any business sense to take them out now and move them.

Related: China’s Crypto Ban Is A Huge Opportunity For Canada, Says Mining Group Chief

The value per machine could be $ 150 at most 200, and it would take about the same amount of money per unit to move them. It doesn’t make sense to do that, he said, which is why I say that half of what was on the network we lost.

Harvey expects regions such as Russia and Kazakhstan to increase their share of the mining landscape with new machines added to the network, but he has no plans to open new stores in those countries just yet. After Dubai and Istanbul, Phoenix only plans to open a store in London. We will not further develop stores outside of these three locations, he said.

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