Topic: Chinese Construction Company Turned Mining Firm Lost Over $23 Millions (Read 349 times)
April 25, 2019, 01:09:55 PM
I ask myself: what is the purpose of this article? the china is a country that has a very shady regime and things of this type was already expected... now the article seems to me that is saying that mining is not a good business and people should keep away from mining... is this that I realize what the article means. I do not understand about the profitability of mining, so I can not comment about that.
April 25, 2019, 12:10:00 PM
This is what happens when plans are poorly made and are based only on current FOMO that aren't going to last long. Just like Masayoshi Son who bought in 2017, and lost $130 million thinking that the price would continue rising forever. They already have a good business model that delivers profits to their doorstep yet they became greedy just like everyone else with the intention to collect quick profits which, sadly, didn't happen at all. I feel sorry for them, but then again, this is business and people should be ready to lose money.
April 24, 2019, 12:27:33 AM
It's very risky to mine bitcoin in the middle of a bear market, when electricity costs potentially could rise while profits from bitcoin mined drop. Probably the best time to mine is in the late stage bear to early stage bull market.
the risks aren't any different from any other time because of the way bitcoin is designed to be like with its difficulty adjustment and the competitive market. the reason why this "company" and many other newbies like them failed and lost a lot of money was because they weren't planning on making profit from "mining"! they were planning on making profit from bitcoin price rise to the moon and they did it because they were newbies who got caught up in the hype of that time. otherwise there are thousands of other miners who have been making profit all around the world because they educated themselves before jumping in.
April 23, 2019, 11:38:01 PM
It's very risky to mine bitcoin in the middle of a bear market, when electricity costs potentially could rise while profits from bitcoin mined drop. Probably the best time to mine is in the late stage bear to early stage bull market.
Maybe someone whisper to the CEO that mining is more lucrative business than construction. But damn the bear market has put another big company out of business, another own bites the dust. They should have done their study first before they went into this business, otherwise you will really sink that fast and it will take years to recover.
April 23, 2019, 11:33:03 PM
It's very risky to mine bitcoin in the middle of a bear market, when electricity costs potentially could rise while profits from bitcoin mined drop. Probably the best time to mine is in the late stage bear to early stage bull market.
April 23, 2019, 11:27:26 PM
Construction business to crypto mining?? What a laughable transition! Consteuction business is a very lucrative business in the emerging economy like China where the government is providing tax rebate and various subsidies to the companies who are associated with construction business. So when you leave a lucrative business and move to a rather uncertain sector, this is what happens! It can be a classic example of a failed vision and failed leadership!
We can't say it a failed leadership, from my view it is a positive thinking about the market but to the expectation things happened in the opposite way making the entire investment go low in a short time period. If the market of bitcoin have stayed same as that of 2017 now we could have praised him making such a decision of transition from a lucrative to uncertain market.Of course who you gonna blame for what happened to them? Definitely the management has something to do with it. They are in a different sector then they suddenly plunge to a industry which I think they don't have the experience that's why the company failed.
They took the gamble but at the end it didn't pay off, they should put everything, the leadership didn't have any plan B in case their venture in crypto mining will fail.
April 23, 2019, 10:18:15 PM
Construction business to crypto mining?? What a laughable transition! Consteuction business is a very lucrative business in the emerging economy like China where the government is providing tax rebate and various subsidies to the companies who are associated with construction business. So when you leave a lucrative business and move to a rather uncertain sector, this is what happens! It can be a classic example of a failed vision and failed leadership!
We can't say it a failed leadership, from my view it is a positive thinking about the market but to the expectation things happened in the opposite way making the entire investment go low in a short time period. If the market of bitcoin have stayed same as that of 2017 now we could have praised him making such a decision of transition from a lucrative to uncertain market. 
April 23, 2019, 09:43:26 PM
Construction business to crypto mining?? What a laughable transition! Consteuction business is a very lucrative business in the emerging economy like China where the government is providing tax rebate and various subsidies to the companies who are associated with construction business. So when you leave a lucrative business and move to a rather uncertain sector, this is what happens! It can be a classic example of a failed vision and failed leadership!
April 23, 2019, 09:40:40 PM
This is true from my knowledge because I invested around $11000 into mining by the days of early 2018. As I wasn't able to mine as the electricity bill is high I searched on Marketplaces to sell the mining equipments and it was quoted to be around $1500. So its a one in ten value. Same I see with the Chinese construction company investment and the present market value. It is not fair to compare such a huge investment with a mere $11000 but the market fall is clearly the same.
April 23, 2019, 09:29:54 PM
Let them decide what they need to do because their policy will be related to their government regulation which wants to shut down the mining company.
I don't think that they are a loss because of the mining process because they are using a big power of hashrate so they can get big rewards too.
Maybe they reported that they are a loss to prevent from paying the tax, but we never know the truth
I am not too believe with the big company saying that they are losing the profit because before they say that, I am sure that they are collecting big money before especially in 2017-2018.
But let's wait for other information from them, and we will see how they will react later.
I don't think that they are a loss because of the mining process because they are using a big power of hashrate so they can get big rewards too.
Maybe they reported that they are a loss to prevent from paying the tax, but we never know the truth
I am not too believe with the big company saying that they are losing the profit because before they say that, I am sure that they are collecting big money before especially in 2017-2018.
But let's wait for other information from them, and we will see how they will react later.
April 23, 2019, 04:39:57 PM
This is the first time that I read a news that a bitcoin mining company went bankrupt. They have all the tools that are needed to mine bitcoin like cheap electricity. I think this is somehow connected to the news that the Chinese government is banning down bitcoin and other crypto related activity in their country.
Are they dodging the Chinese Government with this move? I find it hard to believe that they went bankrupt and lost 90% of their initial investment value.
Losing 90% of your value after having walked away from a relatively lucrative industry in China probably isn't a method of dodging the government. It is very likely that they had purchased all the machines and simply wouldn't be able to realize the gains required to generate a profit. As other users have said, the price crashed from $20k and the difficulty hadn't changed. Even with cheap electricity, a company needs to make money, and if they make less mining crypto than they made when they were a construction company, of course their value is going to go down. Not to mention that the assets they invested in depreciated rapidly and they don't have much use in industries aside from mining. At least with construction, you always have the opportunity for more contracts. Crypto is essentially going alone and relying on your equipment to generate a profit, with no skill or technical expertise involved (aside from setting up the equipment). That's not a great mix for running an actual company, especially if they didn't massively decrease the expenses they would have incurred from normal operations. Are they dodging the Chinese Government with this move? I find it hard to believe that they went bankrupt and lost 90% of their initial investment value.
April 23, 2019, 03:52:47 PM
So they initially bought equipment worth $25M and where's that gone? I mean they bought it last year and I really don't understand how could the value of it depreciate with 90% in less than a year? Yes, probably in China the value of mining equipment has depreciated a lot because of recently rumors regarding the ban of bitcoin mining but still if they would have sold their equipment to companies from others countries the value of that equipment would still be at least 50% or so even if we include the export fees. This seems kind of suspicious to me, how could a company value decrease with 90% after one year considering they had equipment worth $25M?
They likely overpaid for the equipment based on the "potential returns" at the time. Price dropped, but difficulty didn't drop along with it, they likely didn't mine the amount of coins they needed to make it work, especially with the lower price.
April 23, 2019, 10:13:48 AM
This is the first time that I read a news that a bitcoin mining company went bankrupt. They have all the tools that are needed to mine bitcoin like cheap electricity. I think this is somehow connected to the news that the Chinese government is banning down bitcoin and other crypto related activity in their country.
Are they dodging the Chinese Government with this move? I find it hard to believe that they went bankrupt and lost 90% of their initial investment value.
Are they dodging the Chinese Government with this move? I find it hard to believe that they went bankrupt and lost 90% of their initial investment value.
April 23, 2019, 08:11:14 AM
"They went full Jihan, Never go full Jihan" - random quotes
I think it's only the tip of the iceberg. I bet many shell companies use different permit to get cheap electricity for mining. They got what they deserved.
It's like finding a gold mine and needing cheap electricity.I think it's only the tip of the iceberg. I bet many shell companies use different permit to get cheap electricity for mining. They got what they deserved.
We already have cheap electrification
Why do not we mining Bitcoin?.Thinking without planning is what led to such losses even though I am not entirely devoted to the story. They may try to avoid some taxes by announcing losses and so on.
April 21, 2019, 02:50:34 AM
It seems like they entered the market on high price when mining equipment was also pretty expensive and got huge losses. But one thing is still unclear to me: for now, mining is still considered as profitable activity, especially with cheap chinese electricity. At least most mining farms continue their work for that reason. But those guys somehow also got losses during their activities. How is that possible?
April 20, 2019, 10:50:44 PM
basically the whole thing can be summarized in a single sentence:
some people who had no experience or even information about a certain field, entered that field with a lot of capital and their business failed because of that lack of knowledge and experience so they lost a ton of money.
some people who had no experience or even information about a certain field, entered that field with a lot of capital and their business failed because of that lack of knowledge and experience so they lost a ton of money.
April 20, 2019, 06:49:48 PM
So they initially bought equipment worth $25M and where's that gone? I mean they bought it last year and I really don't understand how could the value of it depreciate with 90% in less than a year? Yes, probably in China the value of mining equipment has depreciated a lot because of recently rumors regarding the ban of bitcoin mining but still if they would have sold their equipment to companies from others countries the value of that equipment would still be at least 50% or so even if we include the export fees. This seems kind of suspicious to me, how could a company value decrease with 90% after one year considering they had equipment worth $25M?
April 20, 2019, 02:30:18 PM
"They went full Jihan, Never go full Jihan" - random quotes
I think it's only the tip of the iceberg. I bet many shell companies use different permit to get cheap electricity for mining. They got what they deserved.
I think it's only the tip of the iceberg. I bet many shell companies use different permit to get cheap electricity for mining. They got what they deserved.
the actual quote is they went full bobby lee, never go full bobby lee
(might be worth you checking the current status of BTCC (bobby lees now defunct pool/company named btcchina))
April 20, 2019, 01:00:24 PM
It's not a good strategy to pretend doing one thing while actually doing another. It's sad that they've lost so much, but IMO business should be built on trust and transparency.
I am confused why the op says it's the first company revealed as a mining one. What about Bitmain? What about various Bitcoin farms? Mining is not banned yet, so I thought there were quite some mining companies. Or is it that this is the first "imposter" that actually does mining kind of company in China?
I am confused why the op says it's the first company revealed as a mining one. What about Bitmain? What about various Bitcoin farms? Mining is not banned yet, so I thought there were quite some mining companies. Or is it that this is the first "imposter" that actually does mining kind of company in China?
April 20, 2019, 12:31:30 PM
I think they had problems with management. They also failed because of declaring a different business permit. I guess it's better if they focus more on construction business while doing mining as their side business. Mining business isn't also as profitable as it was. To add, China also banned mining. They should have made an in depth study or a feasibility study before being engaged in mining business before operating it.
Is it for real? When the China government state that they ban crypto mining officially? AFAIK it is just a proposal which is still under review by the government based on the last news that I read few days back. Mind to share the official statement of the China government if they ban crypto mining?
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