Bitmain predicted to be knocked from relevance; US tariffs of 27.5% now apply

Bitmain’s planned initial public offering (IPO) was already facing significant resistance due to the myriad of issues and controversies plaguing the company. However, the future now looks even less bright, thanks to President Donald Trump.

The ongoing trade war between the U.S. and China will undoubtedly impact cryptocurrency mining equipment. This past June, the U.S. changed the classification of the mining rigs from “data processing machines” to “electrical machinery.” Electrical machinery is subject to an import tariff of 2.6%—not unreasonable for any product. However, because of the trade war, the tariff schedule has been updated significantly. Instead of 2.6%, mining equipment manufacturers are now looking at the possibility of paying 27.6%.

Competition in the mining equipment manufacturing space is getting more serious. More than half of Bitmain’s business relies on overseas sales. With the increased tariffs, the company will have a difficult, if not impossible, time offering products at prices that can beat those of its competitors.

Some of Bitmain’s primary competitors, such as Squire, use chips manufactured in South Korea. These are not subject to the tariff schedule, nor are those produced in Taiwan. This will not only give companies that source products from these countries an edge, but it will also give rise to new competitors who will threaten Bitmain’s ability to act in the mining space.

The company even recognized in its IPO filing that there existed the possibility it could be impacted by external forces. It said that its revenue could see declines based on tax rates “due to economic and political conditions.” As Bitmain is already losing ground to competitors who are now producing mining rigs that are faster and more efficient, the tariffs could be the proverbial nail in the coffin that brings an end to the highly questionable IPO.

CoinGeek was already prepared for this eventuality, which is why the introduction of Antiguan-based bComm Association‘s Bitcoin SV (developed by nChain) is vital to the mining community. The full-node implementation software is now available and is quickly gaining favor. Don’t just take my word for it—come check it out during Miner’s Day at the upcoming CoinGeek Week Conference in London next month.

Note: Tokens on the Bitcoin Core (segwit) Chain are Referred to as BTC coins. Bitcoin Cash (BCH) is today the only Bitcoin implementation that follows Satoshi Nakamoto’s original whitepaper for Peer to Peer Electronic Cash. Bitcoin BCH is the only major public blockchain that maintains the original vision for Bitcoin as fast, frictionless, electronic cash.

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ViaBTC mining pool captures $30M in ICO—and that’s a bad thing

A couple of days ago, word got around that one of the world’s largest cryptocurrency mining pools had conducted an initial coin offering (ICO) and had raised $30 million in a little more than two hours. It was the first time an ICO had been held on the Bitcoin BCH network and should be seen more as a failure than a success.

ViaBTC introduced a new cryptocurrency token, the VIAT, ahead of the ICO. The company has billed the token as a “value-added service privileges” coin that can be used as a tool of value transfer. There will be a fixed supply of 2 billion coins, of which 250 million will be shared among the company’s partners and 250 million will be distributed through community support. The remainder will be released over time to reward miners.

Per the coin’s white paper, “ViaBTC will buy back and “burn” VIAT with 20% of its quarterly revenue at the end of each quarter. This will reduce the total amount of VIAT steadily on a benign deflation model.” It would seem that the minds behind ViaBTC don’t fully comprehend the burn process or, if they do, are prepared to destroy the network. When you burn an asset, it becomes destroyed and, as such, means that any return seen on the asset is subsequently worthless.

The idea of burning is tied closely to the idea of Wormhole, the highly debated omni layer protocol that has already been shown to be less than beneficial for the Bitcoin BCH network. It’s no surprise that ViaBTC got its start thanks to a large investment by crypto mining company Bitmain, which supports Wormhole.

There are concerns that VIAT could be an unregistered security per China’s securities laws. Ultimately, this will depend on how ViaBTC uses funds collected from the ICO and whether or not holders of the digital currency earn dividends that might be considered as giving those investors a vested security interest in the company or its CoinEx exchange.

Referring to the distribution of tokens, there is a glaring red flag that pops up. ViaBTC indicates that it will give 250 million tokens to the platform’s partners. This equates to 1/8 being shared among the individuals. Given that ViaBTC has a substantial connection to Bitmain, it isn’t unrealistic to imagine that Bitmain will receive a significant amount of coins.

There are a couple of issues with this scenario. Bitmain has already been outed for questionable financial stability and, possibly, illegal activity—it announced that it was backed by several banks when it wasn’t and, according to internal documents, lied about its finances to investors. Additionally, any collaboration between Bitmain and ViaBTC can undoubtedly be viewed as collusion and will result in lack of decentralization.

Apart from these issues, in reviewing the white paper, there seems to be one important piece of information missing. Out of everything ViaBTC says of VIAT, there simply doesn’t seem to be any tangible utility of the coin.

Note: Tokens on the Bitcoin Core (segwit) Chain are Referred to as BTC coins. Bitcoin Cash (BCH) is today the only Bitcoin implementation that follows Satoshi Nakamoto’s original whitepaper for Peer to Peer Electronic Cash. Bitcoin BCH is the only major public blockchain that maintains the original vision for Bitcoin as fast, frictionless, electronic cash.

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Why Bitmain’s hash war reminds me of Darius III at The Battle of Gaugamela

1,000,000 miners lined up on the plains in formation.

Are they real? Rumours are surfacing that Bitmain has some 1,000,000 “Ghost miners” ready to spring to action to mine BCH (rather than BTC, where the vast amount of Bitmain-controlled mining pool hash now mines) to pervert Bitcoin technology to its Wormhole tech Nov 15th at the next scheduled Bitcoin BCH network upgrade. It’s possible that at least some of this information may be correct, as Bitmain does have a history of not following the rules and especially of throwing its customers under the bus.

We here at CoinGeek have made something of an industry of reporting on Bitmain’s problems and double dealings and how this is likely going to kill their IPO chances. We have also explained in detail a number of times why Bitmain’s WormHole plans are reckless and self-serving at best. And we have also covered their hardware design teams leaving the company and its inability to stay competitive with their hardware offerings.

However, this new rumour brings up another issue, one that goes to the heart of whether or not anyone can trust them. I know I don’t. I bought over a US$100 million from them leading up to Q1 of this year and I can confirm they would never have gotten one Bitcoin BCH from me if I would have known they were going to use my money to try to kill the only technology that actually works as money to the world today.

Since we already know that the entire Mining industry, other than those paid or supported by Bitmain, support Satoshi Vision and will be joining CoinGeek’s side pre upgrade, there are only two possibilities here. Either: (1) this hash is a bluff and will soon be exposed as such; or (2) it’s real and is a kind of fraud or cheating by Bitmain unfairly using its conflicted interests as a hardware sales operation (and a controller of public mining pools which now largely mine BTC not BCH) to stomp on the interests of its own clients.

My purpose in writing this article is to outline my argument that: it is unconscionable that Bitmain should be rewarded for violating its obligations to its BTC mining pool customers by suddenly turning on or moving “ghost miners” to BCH (when its mining pool customers expected to be mining BTC) and operating in violation of the rules of Nakamoto Consensus that the longest chain is a chain of truly competing miners (who I repeat are in fact Bitmain-controlled mining pool customers who invested a lot of money that went to Bitmain to compete fairly).

I have already publicly stated that “I will support the longest Chain” with the most Proof of Work to be recognized as BCH. What I meant by this is the longest chain of legitimate miners competing with each other as outlined in the original Satoshi white paper and as is supported by all who support Satoshi Vision. I still maintain this pledge. I will not, however, follow Bitmain down a rabbit hole of their own making based on cheating by Bitmain.

Furthermore, the longest chain needs to be determined by legitimate, sustained hash power from miners. It would be ridiculously unfair for Bitmain to move or activate 1,000,000 “ghost miners” onto the BCH network only for a temporary basis starting November 15 or short bursts of time, in order to potentially declare an artificial victory in a BCH hash war—but then quickly deactivate those miners or intermittently move them back to the BTC network, while neglecting their own clients. Proof of Work is about true investment to provide computing power and security for the Bitcoin network; it’s a long term commitment, not a one-night stand.  Therefore, the longest chain with the most Proof of Work should be determined by what is legitimate, sustained hash power by miners who are truly committing long-term investment for BCH.

If Bitmain cheats and forces a fork to its own new coin—running its backed Bitcoin ABC changes to the original Bitcoin protocol and also supporting Wormhole—this will result in a chain fork. The entire industry minus Bitmain and friends will stay with Satoshi Vision (as represented by the new Bitcoin SV and other compatible implementations) and this will be the longest legitimate chain as outlined in the original white paper. The Satoshi Vision chain will be the sole remaining version of true Bitcoin in the world and will deserve to remain being called Bitcoin BCH at exchanges globally.

Bitmain can move forward with its Wormhole coin and onto its Wormhole technology that will eventually kill the underlying chain and move to its centralized (with Bitmain) Proof of Stake Wormhole platform. If exchanges want to have this token on their exchanges they can call it what it is, WHL. Exchanges need to make a stand and protect Bitcoin by recognizing Bitcoin BCH as the longest chain with the most legitimate, sustained Proof of Work.

If they do, Bitcoin will survive as Satoshi Vision will have won the day due to legitimate hash investment in spite of all attempts by Darius to cheat on the battlefield.

CoinGeek will actively fight any efforts by Bitmain to fork away from a Satoshi Vision version of Bitcoin.

Note: Tokens on the Bitcoin Core (segwit) Chain are Referred to as BTC coins. Bitcoin Cash (BCH) is today the only Bitcoin implementation that follows Satoshi Nakamoto’s original whitepaper for Peer to Peer Electronic Cash. Bitcoin BCH is the only major public blockchain that maintains the original vision for Bitcoin as fast, frictionless, electronic cash.

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Why Bitmain reminds me of Darius III at The Battle of Gaugamela

In 331 BC, Alexander the Great led his forces to victory over overwhelming forces at the Battle of Gaugamela, which is historically identified as being close to the modern Iraqi city of Dohuk. His foe was Darius III, who had amassed a larger army and, supposedly, significant experience after being beaten at the Battle of Issus two years earlier. The two met to decide who would prevail as Alexander the Great was on his mission to conquer the Persian Achaemenid Empire. Despite having superior numbers, Darius III lost in a big way and repeatedly attempted to negotiate with Alexander to prevent the emperor from continuing his hostilities. Darius was never able to truly develop himself as a leader, having only served as king for six years, becoming the last ruler of the Achaemenid Empire.

Darius had his roots among the “common people.” He was a skillful combatant who, due to royal connections, was able to secure a job as a royal courier and took the throne in 336BC. As a ruler, he was considered to be “out of control” due to his utter lack of experience, which is what ultimately led to his downfall.

There are a lot of similarities between Darius III and cryptocurrency mining company Bitmain. Bitmain rose to prominence without having any superior skills, settling for a completely chance encounter at the opportune moment to seize control of the crypto mining hardware market.

It has been reported that the company’s most popular miner could have been stolen and several new products that the company has tried to introduce have been complete failures. In fact, only about half of the products take to market have received any type of successful reception— the others have failed miserably.

Like Darius, Bitmain now allegedly has a large amount of troops behind it. It is hoping that the forces, regardless of experience level, will help catapult the company to the ultimate victory and give it complete control over the mining industry.

However, it’s more likely that Bitmain will follow the example set by Darius at the Battle of Gaugamela. Darius turned tail and ran, leaving his commanders and soldiers to fall while he temporarily went into hiding.

This is where we are today, with questionable movements and decisions underscoring Bitmain’s approaching initial public offering (IPO). When put to the test, the company can’t stand up to the pressure and will more than likely run away after putting on a valiant show of force.

Note: Tokens on the Bitcoin Core (segwit) Chain are Referred to as BTC coins. Bitcoin Cash (BCH) is today the only Bitcoin implementation that follows Satoshi Nakamoto’s original whitepaper for Peer to Peer Electronic Cash. Bitcoin BCH is the only major public blockchain that maintains the original vision for Bitcoin as fast, frictionless, electronic cash.

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Bitmain resorts to threats over fragile IPO

Our sources tell us that Bitmain executives have promised to “disappear” anyone who crosses them inside China.

While doing the background research for another Bitmain article, our sources told us of the disturbing threats, and we were able to confirm these with our other sources close to Bitmain.

I don’t believe this was a Google translate error, where they meant to say that they’d beat their competitors fair and square in the free marketplace but instead like the old gangsters in Las Vegas, they’d drop them in a hole in the middle of the Nevada desert.

Bitmain released a prospectus, in advance of their long-planned IPO, to lukewarm reviews as the document raised more doubts about the company’s long-term viability.

According to a Medium post by Ken Lu, several points should concern every investor particularly in referring to slide 30 of their investor deck, Bitmain misrepresented its net profit.

To quote Lu, “…misrepresenting this and to such a degree is nothing short of financial fraud.” (You can read the post here.)

The prospectus highlighted the company’s unsold hardware and their warehouses of unsold technology which at a time was the best on the market but has recently been surpassed by new players who are producing faster and more efficient miners leaving the prospects of millions of dollars in inventory going unsold and written down for massive losses.

In recent weeks, Pangolin released its well-received Whatsminer M10 ASIC Miner , while initial test results for the upcoming Squire Miners indicate 1.5x more hashing capabilities while consuming 50% less energy than the top of the line Bitmain ASIC miners.

Interestingly, the Pangolin miner comes from the mind of former Bitmain technologist Yang Zouxing. Bitmain has struggled to replicate the success they had with Yang Zouxing who did the heavy lifting with chip design.

Their inability to combat the corporate brain drain as their top tech minds continue to leave the company have put Bitmain in a dire situation.

Attempting to defraud investors and now issuing veil threats of violence against people who dare compete with them in a free market isn’t the behaviour of a stable and trustworthy company deserving of investors cash.  It’s the behaviour of gangsters who are desperate for money hoping a hail mary IPO will give them some semblance of hope at surviving in this new competitive marketplace.

This all adds smoke to the Bitmain Bankruptcy rumours.

Note: Tokens on the Bitcoin Core (segwit) Chain are Referred to as BTC coins. Bitcoin Cash (BCH) is today the only Bitcoin implementation that follows Satoshi Nakamoto’s original whitepaper for Peer to Peer Electronic Cash. Bitcoin BCH is the only major public blockchain that maintains the original vision for Bitcoin as fast, frictionless, electronic cash.

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Scrutinizing Bitmain’s IPO produces more questions than answers

Only a week ago, it was reported that cryptocurrency mining company Bitmain was preparing to move forward with its long anticipated initial public offering (IPO). The announcement may have had a positive impact on the Bitcoin BCH price, but that excitement was short-lived and now the IPO is beginning to be scrutinized in greater detail. The results are even more disconcerting than previous analysis of the company revealed.

The release of Bitmain’s IPO application (in pdf) has led to more questions about the company’s solvency. Around 28% of the company’s assets are in cryptocurrency, leading some to believe that Bitmain is essentially about to introduce a crypto fund through the IPO. However, this is more than likely not the case, as Bitmain’s physical inventory, for example, provides the company with a certain amount of diversification.

However, that physical inventory has decreased significantly in value. This is due to a market that rapidly shrunk in size, leaving Bitmain with product that it couldn’t distribute. Therein lies one of the problems – having inventory and no market is a dead end.

The lengthy IPO document, in one instance, leads readers to believe the company is a manufacturing firm (despite 50% of its products ultimately failing) and, in another, that it is offering a mining stock. It is also a company that offers services to other sectors, further exasperating attempts to define its operations.

A post on Medium by Ken Lu makes four startling revelations about the company. Lu dissected the IPO in great detail and also reviewed the company’s pre-IPO Investor deck. What he discovered should give pause to anyone considering making an investment in the company.

Lu points out that Bitmain misrepresented its net profit for last year. Referencing slide #30 of the Investor deck and page 307 of the prospectus, he points out that there is a huge $550-million mismatch between Bitmain’s stated net income and its audited income. Lu asserts, “This massive US$550 [million] Net Income ‘miss’ translates into implied PE multiples being significantly inflated. Many investors relied on this essential figure for doing the analysis, and misrepresenting this and to such a degree is nothing short of financial fraud.”

Bitmain also allegedly misrepresented its net profit target for the current year. Lu points out, “[I]nvestor deck (slide #30) states Net Profit Target for 2018 at US$1.8 [billion] which we now know is a complete sham. But did [Bitmain CEO Jihan Wu] and Directors know of this while fund-raising for Pref B and B+ rounds during summer? This is the key question Hong Kong courts will be asking. And the answer is undoubtedly yes!”

Lu also points out that Bitmain was creative with its financial reports this year. He indicates that the company had tied together the results from the first two quarters without showing the individual quarter results. The first quarter was highly successful, but the second quarter was a virtual failure. This shows a tendency of the company to try and fool investors with smoke and mirrors.

The last misrepresentation comes through Bitmain’s accounting of its inventory. He calls out Bitmain for not breaking down “its actual inventory of cryptocurrency and recording it at cost vs true market value. It’s very odd that for something that constitutes 28% of Assets is a complete ‘black box’ to investors.” Lu adds, “Bitmain holding close to a US$1billion in a ‘black box’ that can at any time plummet to zero, is surely not something the Hong Kong regulator will take lightly.”

Lu concludes, “Investors in the recent pre-IPO round were misled as to the accuracy of the data, and considering complexity and opacity of Bitmain’s business (compared for example to its competitors Canaan and EBang), Hong Kong Regulators will be taking a very close look at the business model, requiring more clarity and explanation. All of that will require more time, and that will coincide with Bitmain having to disclose even more disastrous Q3 results, which will even further damage investors’ appetite for the IPO.”

Note: Tokens on the Bitcoin Core (segwit) Chain are Referred to as BTC coins. Bitcoin Cash (BCH) is today the only Bitcoin implementation that follows Satoshi Nakamoto’s original whitepaper for Peer to Peer Electronic Cash. Bitcoin BCH is the only major public blockchain that maintains the original vision for Bitcoin as fast, frictionless, electronic cash.

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The issue with Wormhole, summed up in one sentence

There has been a raging debate on a topic that has caused a significant divide in the Bitcoin BCH community. A contentious project has been launched that was purported to be an advance for the network. However, when the facts are revealed, what emerges is a nefarious plan that strips away the very heart of not just Bitcoin BCH, but the entire cryptocurrency ecosystem.

The project is Wormhole, a Bitcoin BCH smart contract platform. It has been co-developed by crypto mining giant Bitmain and is supported by Bitcoin ABC. According to the platform’s developers, “The Omni Layer runs on top of Bitcoin blockchain — Since the Omni Layer protocol uses the MIT license (open source), we forked the Omni Layer protocol and implemented the tech feature on Bitcoin Cash blockchain to achieve token issuance. We named this technical solution Wormhole protocol, and the original token in the protocol is named Wormhole Cash.”

The issue at hand is that it the project actually creates a new cryptocurrency that will turn the Bitcoin BCH network into nothing more than a veritable playground for developers. This could potentially lead to questions being raised about Bitcoin BCH’s security and causing the regulators to drop the hammer on the digital currency’s network.

Wormhole, according to a post by developers on Medium, can also “execute the issuing, transferring and burning of tokens. Since Wormhole is a protocol for BCH but operating separately from BCH, it uses an account/balance model that was best suited for a smart contract. Thus, we can successfully resolve the fundamental issue in BCH’s UTXO model.”

In order for a burn to take place, a special burn address needs to be created and this presents another problem—you can’t actually back anything in a burn. This means that the Bitcoin BCH sent to the burn address would become invalid. Burning implies a destruction of the asset, which makes any return on the asset worthless.

If those issues weren’t enough to cause people to question the legitimacy of Wormhole, a phrase hidden in the project’s white paper is the nail in the coffin. Developers acknowledge, in black and white, that they want to be able to manipulate the network. The white paper reads, “In the future, if any methods be used to create the private key of this address – the BCH protocol might prohibit coins in this address from being transferred.”

This shows that the developers are not thinking decentralization—the heart of cryptocurrency—and are fully prepared to wield their power over the network. They have also coded Wormhole to allow them to assert their control on a whim.

Elsewhere in the white paper, Wormhole developers make the claim that Wormhole can provide greater decentralization and independent outputs. However, given the fact that they have coded Wormhole to be able to control the network, where exactly is the decentralization?

Note: Tokens on the Bitcoin Core (segwit) Chain are Referred to as BTC coins. Bitcoin Cash (BCH) is today the only Bitcoin implementation that follows Satoshi Nakamoto’s original whitepaper for Peer to Peer Electronic Cash. Bitcoin BCH is the only major public blockchain that maintains the original vision for Bitcoin as fast, frictionless, electronic cash.

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Bitmain ready to move on IPO, files prospectus with the Hong Kong Stock Exchange

Cryptocurrency mining company Bitmain has officially filed its initial public offering (IPO) with the Hong Kong Stock Exchange. The IPO was submitted this past Wednesday in its draft form, meaning that it still has to face hearings by the exchange. Since many of the details in the application are redacted, it is still unknown what the firm’s value will be when, and if, the IPO is accepted.

According to the grossly redacted IPO application (in pdf), Bitmain earned over $2.51 billion in revenue last year, up from the $277,612 reported a year earlier. After adjusting for expenses and costs, the company’s net profits were $113.5 million in 2016 and $952.5 million last year. It also reported a net profit of $952.1 million in the second quarter of this year, according to the filing.

Bitmain has been embroiled in a fair amount of controversy over the past few months, the majority of which stems from apparently false assertions by the company. In a funding round this past summer, it said that it had received funding from Japanese banking giant Softbank and China’s Tencent, both of which were found to be false. Additionally, it has repeatedly discussed its strong financial position in public, but released internal documents painted a different, much bleaker financial position.

Those concerns have led many to question the credibility of the company, especially as it has been preparing to go public. There have also been concerns raised about support by Bitmain, and its co-founder, Jihan Wu, of changes to Bitcoin BCH mining protocols. Specifically, the introduction of the canonical transaction ordering rule (CTOR), which was created by Bitcoin ABC and backed by Bitmain, could result in a complete network alteration.

Bitmain has sided rigorously and publicly with Bitcoin ABC on the topic, which is forcing the network to accept what the developers want, and not what the community wants. However, as Bitmain says in its IPO, the members of the mining community need to support the idea for it to be accepted. It’s another example of Bitmain’s sneaky and misleading tactics – offering one story in public and then hiding behind a façade to force their internal objectives.

The IPO seems to indicate strong support for the Nakamoto consensus and the ability for miners to decide the direction in which the blockchain heads. However, this is precisely the opposite of the position stated openly over the past couple of months.

There also seems to be an indication that the amount of hash controlled by Bitmain isn’t as significant as the company would like everyone to believe, and that it may not even be owned by Bitmain. This could lead to mining operators jumping over to other mining code implementations, such as Bitcoin SV, to escape the mindless and reckless off-chain networking that Bitmain has supported. Along those same lines, since the IPO provides the idea that Bitmain doesn’t control a significant amount of hash, the current Bitcoin BCH “hash war” that some pundits suggest could lead to a new split might be nothing more than a bluff – Bitmain doesn’t have the resources to back up its fight.

The IPO could do more harm than good for a company that is already reeling from a series of setbacks. It hasn’t been able to produce quality products that can compete against other miners on the market and the majority of its “cash” is tied up in inventory that sits in a warehouse unsold. While many IPOs are joyous events, this feels like a desperate gasp.

Note: Tokens on the Bitcoin Core (segwit) Chain are Referred to as BTC coins. Bitcoin Cash (BCH) is today the only Bitcoin implementation that follows Satoshi Nakamoto’s original whitepaper for Peer to Peer Electronic Cash. Bitcoin BCH is the only major public blockchain that maintains the original vision for Bitcoin as fast, frictionless, electronic cash.

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Ebang E11 miners boast of up to 44 TH/s; Squire taps Samsung for next-gen ASIC chips

One of Bitmain’s biggest rivals, Ebang Communication, has announced three new crypto mining rigs, which reportedly feature hashrate speeds of up to 44 trillion hashes per second (TH/s).

The China-based ASIC mining chip maker revealed its E11 series miners at the World Digital Mining Summit in Georgia. On its website, Ebang stated that sales for Ebit Miner E11, E11+ and E11++ will be “forthcoming.”

Like its E10 product line, Ebang’s E11 series features a 10nm chip. According to a product flyer posted by Blockstream CSO Samson Mow on Twitter, the E11++ offers efficiencies of 45 J/TH at 44 TH/s “for the entire miner at the wall, not the chip.” E11+ is capable of 37 TH/s, while E11 can reach 30 TH/s.

Eban’s E11 miners are expected to come out ahead of its competition, such as the Whatsminer M10, the Bitfury Clarke, and Bitmain’s yet-to-be-released 7nm miner. Announced just last week, Whatsminer M10 is a 16nm ASIC miner from Pangolin, which is specifically designed for the SHA256 algorithm and can mine Bitcoin BCH, as well as BTC, at 33 TH/s. In comparison, Bitfury’s 14nm Clarke fully customized ASIC promises up to 120 gigahashes per second (GH/s) hashrate.

Bitmain claimed it has a 7nm chip capable of up to 41 J/TH power efficiency—which falls in comparison to Pangolin’s E11 miner series.

Red flags over the competitiveness of Bitmain’s chips have been raised recently. According to analysts from Sanford C Bernstein & Co, the Beijing-based ASIC device manufacturer has begun to lose the competitive edge that allowed it to control as much of 85% of the market for crypto mining chips.

Ebang Communication, along with another Bitmain rival Canaan Creative, have announced plans to hold initial public offerings (IPO) on the Hong Kong Stock Exchange, targeting to raise as much as $1 billion. Bitmain is also supposedly preparing for a September IPO, but recent reports indicate the company is suffering from inventory losses, a lack of new manufacturing and the dwindling crypto mining market, which has already caused Nvidia to pull back on its production and financial forecasts.

Squire taps Samsung to manufacture ASIC chips

Meanwhile, another player is gearing up to join the ASIC crypto miner market.

On Tuesday, Canada’s Squire Mining Ltd. announced that it has chosen Samsung Electronics as its foundry partner to manufacture its next-generation ASIC chips in South Korea. Gaonchips is designing the chip for mining of Bitcoin Cash (BCH) as well as alt coins such as those using SegWit technology.

The FPGA (field programmable gate array) prototype for Squire’s first ASIC chip is expected to be completed by Sept. 30, 2018.

In a statement, Squire said, “Our front-end development team of engineers and programmers is currently working with Gaonchips to develop the company’s initial ASIC chip to mine Bitcoin Cash, [BTC], and other associated cryptocurrencies using a wafer process technology that, once confirmed and accepted as meeting certain prescribed specifications and criteria, will form the basis of an initial mass production test run of the ASIC chip by Samsung Electronics.”

Squire’s joint venture with Hong Kong-based tech firm Future Farm Developments Ltd., Arasystems Technology Corp., which will manage the development, manufacturing and assembly of Squire’s ASIC chip-powered mining rigs.

The pilot production test run of Squire’s initial ASIC chip and mining systems for Bitcoin BCH is expected to be completed by the end of fourth quarter of 2018. Squire Mining will then deliver the ASIC chips and mining rigs to associates of Bitcoin BCH’s largest mining company, CoinGeek.com, which has been granted the exclusive right to market, promote, solicit, sell and distribute Squire’s new ASIC chips and mining rigs to Bitcoin BCH and other alt coin miners throughout the world.

Note: Tokens on the Bitcoin Core (segwit) Chain are Referred to as BTC coins. Bitcoin Cash (BCH) is today the only Bitcoin implementation that follows Satoshi Nakamoto’s original whitepaper for Peer to Peer Electronic Cash. Bitcoin BCH is the only major public blockchain that maintains the original vision for Bitcoin as fast, frictionless, electronic cash.

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Pangolin brings a newer, better crypto miner to market (Sorry, Bitmain)

Even though reports have been flying around about a decrease in cryptocurrency mining, there is still—and always be—a need to have miners behind the networks. Bitmain’s Antminer line of products may have once been the leading solution, but new players in the market have started to take away large parts of Antminer’s control. None may be as successful as a new miner being introduced by Pangolin, the Whatsminer M10.

The Whatsminer M10 is a 16 nanometer (nm) ASIC (application specific integrated circuit) miner that includes a CPU. It is specifically designed for the SHA256 algorithm and can mine either Bitcoin BCH or Bitcoin Core (BTC) at 33 terahashes per second (TH/S).

What makes it particularly interesting is its power consumption. The M10 consumes 2145W, which—at 33 TH/S—breaks down to 65W per terahash (W/TH). An offshoot of the M10, the M10S, processes 55 TH/S and its power consumption is 3575W, resulting in the same 65 W/TH rating. A YouTube video showcasing the miners can be found here.

By way of comparison, most ASIC miners, including those offered by Bitmain, are around 85-100 W/TH. Given that the M10 is a 16nm chip, its statistics are made even more impressive.

Curiously enough, the man behind Pangolin, Yang Zuoxing, has ties to Bitmain. He actually gave Bitmain its head start in the game before Bitmain allegedly ran off with his concepts. Since then, however, Bitmain has not been able to repeat the technology and several of its products have failed to capture the market’s attention. Pangolin and Bitmain are now embroiled in a patent dispute over their differences.

Undoubtedly, Pangolin’s M10 and M10S will further erode Bitmain’s position in the mining market. Given the string of bad news the company has had to deal with over the past couple of months, this certainly won’t bode well for its future. Bitmain reportedly already has an overwhelming surplus of mining equipment that it hasn’t been able to move out of storage, and more efficient offerings like Pangolin’s will only exacerbate the issue.

This new Pangolin miners are available now for ordering, but the company won’t begin shipping for about another month. That’s perfect timing, as it gives miners enough time to place their new orders and start looking for possible candidates to purchase their old, clunky rigs.

Note: Tokens on the Bitcoin Core (segwit) Chain are Referred to as BTC coins. Bitcoin Cash (BCH) is today the only Bitcoin implementation that follows Satoshi Nakamoto’s original whitepaper for Peer to Peer Electronic Cash. Bitcoin BCH is the only major public blockchain that maintains the original vision for Bitcoin as fast, frictionless, electronic cash.

The post Pangolin brings a newer, better crypto miner to market (Sorry, Bitmain) appeared first on Coingeek.

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