After $321 Million Loss Japan’s GMO shuts its Mining Software, Giving shudders to the Miners
Just 15 months after the launch of the GMO’s mining equipment business, on Christmas, the company in a recent press release announced its plans to close down its mining software. This is not a complete shutdown of the entire business though, as the company will continue with its in-house mining business. The company has been designing and manufacturing mining chips. But with cryptocurrency rates crashing so violently, it has severely affected the company has incurred a lot of losses to GMO.
The press release titled- “Recording Extraordinary Loss Related to The Cryptocurrency Mining Business Restructuring,” was released on Dec. 25. In the announcement, the firm pointed at the dear losses of 321 million dollars. As per the reports from ‘CoinGeek,’ this loss could be divided into ¥11.5 billion, i.e. $104.1 million from the company’s in-house mining operations, while ¥24 billion ($217.4 million) from the mining equipment business. Reports from another news outlet- ‘Crypto Slate’ say that these losses find their sources from the “transfers of receivables and impairment losses at $217 million and $104 million respectively.”
GMO’s take on the mining equipment and its decision on shutting it down-
“[…] the environment is increasingly competitive because of the decreased demand mainly due to the decline in the cryptocurrency price; the decline in the sale price, etc. […] The Company expects that it is difficult to recover the cryptocurrency mining business-related assets through selling mining machines.”
Despite the big losses and hard time, the Company is hoping an increase in the net assets for the fourth quarter of 2018. The Company bases its expectations on the offsetting profits on sales of the shares in its listed subsidiaries- GMO Payment Gateway. Inc. and GMO Financial Holdings. Inc.
Six months ago, the Japan-based internet giant GMO released an upgraded version of its crypto mining computer. It launched its GMO Miner B2 and B3 machines which makes use of 7 nanometer ASIC chip, which is backed up with 24 tera-hashes/ second (TH/S) and 33 TH/S respectively. The B3 Miner and the B2 Miner were both offered at the same price of $1,999.
On the other hand, last month, the Vice President of MicroBt Technology, Jordan Chen, said in CoinGeek Week conference-
“I can be proud to announce that this is the best product which you can test in your mining farm, in the market at the moment.” He hopes that the miners will be using 7mm chips by next year, due to their energy efficiency and competitive market prices. He also added that- “Of course, you may have heard a lot of people like two Japanese players, a handful of Chinese players working on the 7-nanometer process, and there is also launches in the market, a couple of them. But the majority of them, the actual performance is above 80 W/TH.”
He also said during the presentation that the actual performance of the 7mm chips is expected to be 30 to 50 percent better than those in the market. As per the reports from the FXStreet, the complex mining rig tool- ‘B3 Miner’ that comes with the 7-nanometer chip is specially designed to solve the mining equation in the BTC algorithm.
GMO is yet to share its rescue strategies and how it will turn the situation back into gaining profits.