Canaan wants to increase its Bitcoin mining power 60 times

Canaan wants to increase its Bitcoin mining power 60 times

Key facts:
  • 23.86 bitcoins have been issued in favor of the mining company.

  • The third quarter of 2021 was the one that gave the company the highest revenue in its history.

Chinese Bitcoin (BTC) mining hardware maker Canaan announced on Tuesday its intention to raise the hash rate (hash rate) of your mining activity at 1.8 exahashes per second (EH / S). This with the intention of becoming an important mining company in the market, in addition to standing out in the manufacture of equipment.

So reported the founder and president of the company, Nangeng Zhang, during the presentation of the Canaan’s performance during the third quarter, on an international call.

According to the businessman, the increase in the rate would represent 1% of the current total of the network. In addition, it would have the goal of adjusting the balance between the sales of its cash orders to futures, in addition to the patented mining capacity.

Zhang commented that the Canaan’s current operating hash rate has remained at 0.032 EH / S since he ventured into Bitcoin mining, that in the second quarter of the year. This debut was made by the company with the intention of solving operational problems and other aspects of taxation and compliance.

Zhang explained that Canaan has, so far, issued 23.86 BTC for the company’s balance sheet from the third quarter. There is talk of an assessment of USD 1.4 million, based on the current prices of the first cryptocurrency.

The businessman clarified that the company’s current strategy is to keep its bitcoins and not exchange them in the short term. “However, we do not rule out the possibility of marketing them in the future”, finished off.

Equipment shipments and deal closing

The executive announced that a batch of mining equipment of the Avalon series, which has a computing power of 0.85 EH / S, is already in the facilities of its hosting partners in Kazakhstan, waiting to be distributed.

Canaan wants to increase its Bitcoin mining power 60 times
The AvalonMiner 1246, one of the teams
more powerful of the Canaan signature.
Source: Canaan.

He also explained that Canaan has signed additional contracts to host 1 proprietary hash rate EH / S. Scheduled shipments, he said, will begin in late January.

Meanwhile, he communicated that hosting agreements are being negotiated with facilities in North America, for about 200 megawatts of power capacity.

The highest quarterly earnings in its history

Shortly before the call, Canaan posted the financial results of the third quarter of 2021, which they identify as the one provided the highest income in its entire history.

In figures, the company obtained a record amount of USD 204.5 million in net income during that period, which is 21.8% more compared to the second quarter, when curiously it also set a record.

Such numbers may be related to the high volume of purchase by institutional investors in Bitcoin mining, as well as the fact that the impact generated by the exodus of miners from China it was practically outgrown.

Even at the end of the third quarter, Canaan reported that it had contractual liabilities of USD 159.3 million. As indicated, these funds were canceled for initial payments concept of institutional investors to Avalon miners pre-orders, to be distributed, at least, towards the second half of 2022.

They also announced a increase in their prices. Starting next year, miners will go up in cost due to the global shortage of chips. This is how he defended it in the call:

We have to recognize that the continued restriction of the supply chain throughout the industry has created a seller’s market. Consequently, the rise in chip prices is natural and inevitable. In this context of unstable chip supply, we are discussing a series of flexible strategies that include accepting price increases under certain conditions to secure our supply.

Nangeng Zhang, founder and president of Canaan.

A direct response to the arrival of the new Bitmain miner?

Canaan’s announcement comes a few days after the arrival of the most powerful and capable miner in the world, the Antminer S19 XP, from Bitmain, one of the largest hardware manufacturers to mine Bitcoin.

As reported in CriptoNoticias, the S19 XP has an extraction capacity of 140 TH / S, with an average consumption of 3.1 KWh and a power of 21.5 joules per terahash.

The arrival of the new miner was announced last week during an event in Dubai, United Arab Emirates. There the first negotiations between companies linked to mining and the Chinese firm took place.

While Bitmain once again showed its might during that event, this move by Canaan can be read as a wake-up call, a warning that they continue to produce, improve and competing.

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