Billions of Yen Loss, GMO Stop Production of Crypto Mining Machines
The Japanese internet giant, GMO Internet Inc., has announced that it will no longer develop, produce or sell crypto currency mining machines . This statement was revealed after the GMO held a board of directors meeting last Tuesday (25 December). In the fourth quarter of the fiscal year ending December 2018, the company reported a massive loss of 24 billion Yen (around 216 million US Dollars), related to the production activities of the crypto mining machine.
In the announcement on its official website, GMOs wrote:
"Regarding the current mining machinery market, the scope is increasingly competitive due to lower demand, lower prices of crypto currencies, lower selling prices, etc ... The company has difficulty recovering assets related to crypto currency mining business through the sale of mining machines, so we decided to stop the development, manufacture and sale of mining machinery. "
GMOs first announced the development of 7nm Bitcoin mining equipment in September last year. Miner B2, the first line of mining products went on sale in June for $ 1,999. Other products, Miner B3, go on sale in July at the same price. B2's first batch should be sent at the end of October, while B3 is targeted to be sent in November. However, until now no mining machines of either type have been released.
Disadvantages in the Cryptocurrency Mining Sector
For the in-house mining business launched in December last year, GMOs recorded huge losses. The company explained that the profitability of the in-house mining business declined because the price of the crypto currency dropped dramatically . This is further compounded by the share of mining that has not increased according to expectations, due to the growth of global hash rates that exceed the initial assumptions.
The crisis in the crypto mining sector is not the first time this has happened. In November, the big mining company Giga Watt was declared bankrupt because he failed to pay the debt. In addition, old mining rigs in China are reportedly sold at very cheap prices.
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