Bulk preorders for the latest bitcoin ASIC miners are sold out until next spring

Quick Take

  • Bulk preorders for the most powerful bitcoin miners from major manufactures are sold out until May 2021
  • Institutions outside China have been a notable buying force but some say this doesn’t necessarily equal to overseas hash rate growth
  • Many Chinese retail bitcoin miner operators have turned to ethereum mining as bitcoin’s threshold is getting higher-than-ever.

Bulk preorders for the most powerful bitcoin mining hardware from major manufacturers are already queued up until May next year, suggesting an increasing level of institutionalized demand for such equipment.

Bitmain's official website shows that preorders for its flagship AntMiner S19 Pro, S19 and T19 products will have to wait until May 2021 for delivery, which means the preorders with shipments before that have already been sold out at the bitcoin hardware giant.

Similarly, MicroBT — the top rival of Bitmain — is showing ”sold out" for its flagship WhatsMiner M30 series on its website. A company spokesperson told The Block that the firm is already selling April to May future preorders and the capacity for months before that is essentially out of stock.

The overall supply shortage follows bitcoin's price jump since Q3 this year, and is due to both an increase in institutionalized demand for bitcoin mining equipment and the limited wafer capacity from Bitmain's and MicroBT's silicon providers.

“We are still working hard to try to get more chip capacity from Samsung to satisfy more preorders for future stocks," the MicroBT spokesperson said in a WeChat message. Bitmain, on the other hand, sources silicon chips from Taiwan Semiconductor Manufacturing Company (TSMC).

That said, orders for spot stocks in limited small quantity are still available at the manufacturers' distributors, albeit with a steep price premium.

Based on various quotes posted by mining equipment distributors on WeChat seen by The Block, orders for spot stocks of Bitmain's AntMiner S19 Pro are priced between $3,800 and $4,100 per unit. 

For context, the quotes for the same model's spot stocks in just early November were around $3,300 per unit while the price for S19 Pro's future orders with an April shipment is at $2,684. 

While a bitcoin miner supply shortage is fairly common following a bitcoin price surge – the same situation was also seen in June 2019 and the 2017 bull market cycle – what appears to be different this year is that buying forces are even more consolidated, with heightened demand coming from institutions outside of China.

"We have many customers looking to purchase more than 1,000 machines at a time," said Mike Colyer, CEO of Foundry, the subsidiary of Digital Currency Group that procures bitcoin mining equipment and offers financing services for North America operators.

Colyer said while there has been a lot of construction of mining farms in North America in recent years, the chip supply from fab semiconductors are not allocating the same capacity to miner makers as they did in the past.