The Chinese company Canaan cut prices of its ASIC-based bitcoin mining machines by nearly 50% to improve sales, but it wasn’t enough to prevent the heavy loss. The demand for bitcoin mining rigs slumped as the coronavirus pandemic disrupted the movement of goods worldwide, which also took a toll on the bitcoin mining rig manufacturer companies. The shares of Chinese bitcoin machined manufacturers fell as much as 3.51% to $3.85 on the Nasdaq Stock Exchange, as the stock has tanked from a 52-week high of $13.
Canaan’s terahash sales account for about 1% of the BTC network’s current total.
According to Canaan’s earnings release published this week, the company sold 0.9 million terahash per second (TH/s) of Bitcoin hashpower, up from 0.7 million TH/s in the same period in 2019. But this year’s terahash sales account for only about 1% of the BTC network’s current total. For the same period January to March, the revenue of the Chinese company climbed 45% to $9.4 million from $6.6 million the previous year, driven by a 19% increase in total computing power sold. The overall market situation since December last year until January had not been too good, said Canaan’s CEO Zhang Nangeng.
The COVID 19 pandemic largely affected the sale.
The chief executive officer of Canaan, Zhang Nangeng, told analysts in an earnings call that the overall market situation since December last year until January had not been too good. Thus the unit price per TH/s was lower, he added. He also noted the logistics in mainland China had stopped since the Chinese new year due to the COVID 19 pandemic. Even though bitcoin’s price was at a higher point in February and early March, the pandemic mainly affected the sales. The quarter report informs that the decrease was mainly due to higher short-term investments as the company invested $24.5 million in short-term investments as of March 31, 2020