The POW POWER event, "Will Another Mining Crisis Happen? How Should Miners Respond to This Market Rally?" concluded successfully on the afternoon of March 13. Co-hosted by HashPower Interconnect, Canaan Blockchain, BTC.TOP, and ZhiJian XinYun, the online discussion was exclusively live-streamed by Golden Finance. The event featured the following three guests:
Zhu Fa
Co-founder of BTC.TOP Mining Pool
Co-founder of BTC.TOP, a world-leading comprehensive mining pool, and founder of the New Era Mining Summit.
Yu Wei
Founder of ZhiJian XinYun
A miner since 2012, Yu Wei personally controlled 5% of the global hash rate at his peak in 2015. The mining farms he designed, known for their advanced concepts and mature solutions, have become industry benchmarks, earning him the title "China's No. 1 Mining Farm Builder."
Wang Yan
Mysterious Veteran Miner
A senior miner and mining farm investor with extensive experience in farm investment and mining resources.
AndyHe [Host] Opening Remarks: Global capital markets have plunged into a "Black Week": oil prices crashed, the Dow Jones Industrial Average triggered multiple circuit breakers, and BTC posted its largest single-day decline in history. Panic has swept across markets—margin calls surged overnight, surpassing even China's confirmed COVID-19 cases. With capital markets on high alert, we've invited several heavyweight guests to analyze the current situation and discuss how miners should respond. Is another mining crisis on the horizon?
AndyHe [Host] Question to the Three Guests: Starting March 12, BTC plummeted sharply from $5,555, continuing its steep decline on March 13 to briefly touch $3,800—a nearly one-year low. What are the underlying factors behind this crash?
Zhu Fa: What's the root cause? Essentially, a lot of capital entered this industry not out of belief in the assets, but to earn interest from cryptocurrency traders. So, was this recent prosperity real, or just a bubble?
I'm not saying mainstream cryptocurrencies "should" trade at this price or lack future potential. My point is that, right now, the industry's understanding of cryptocurrencies may only justify holding them up to a certain level. In practical terms, this means users' confidence determines how much capital they commit—and for how long.
So, can we view today's price as a kind of "reversion to fair value"? We'll need to watch BTC's price action over the next few days to be sure.
Personally, after such an extended correction, Bitcoin shouldn't have dropped to $3,800—but it did last night. It reminded me of early 2014, when it was at 8,000 RMB, only to fall to 900 RMB by year-end. My emotions are mixed. I spent the whole night thinking about those numbers. I wanted to buy the dip but realized I was already out of ammunition—I had bought at the top days ago. For veteran miners and long-term HODLers like us, this seems like an ideal accumulation time, yet the price action is disheartening. But I haven't given up. I firmly believe BTC will reach new all-time highs, so everyone, please hang in there a little longer.
Yu Wei: Oil prices have plunged, and the global pandemic is devastating the real economy. U.S. equities have crashed severely—a historically rare event—triggering massive global liquidity outflows! The U.S. stock market fell 2,200 points intraday, and at least nine countries' equity markets hit circuit breakers! The RMB depreciated by 800 points, and even gold collapsed. So, how could Bitcoin possibly fare well? The total market cap of digital assets is roughly $150 billion—still tiny compared to traditional finance. Therefore, the impact of global equity markets dwarfs that on digital assets. This downturn stems directly from the real economy's collapse, hitting the largest holders of digital assets the hardest. To meet urgent cash needs, many are forced to liquidate digital assets—and leverage magnifies losses exponentially. When severe negative shocks hit, leveraged positions can be wiped out dozens of times faster. We don't yet know how deep the damage runs or where the bottom is. But those who retain conviction in digital assets will continue accumulating, thereby enhancing the network's stability and decentralization.
Wang Yan: Major international financial instruments are collapsing simultaneously. Many institutions are withdrawing funds to stay afloat or simply lack confidence in Bitcoin. Of course, some large players are also conducting wash trades and deleveraging to acquire more low-cost positions. As for BTC's short-term price movement, that's largely up to fate. Long-term, however, I remain bullish. No need to overanalyze the data—we can all see it. The most important thing right now is simply to hold your coins.
AndyHe [Host] Question to Zhu Fa [Guest]: According to BTC.TOP Mining Pool data, the network's current hash rate stands at 114 EH/s. Despite BTC's sharp price drop, the hash rate hasn't declined significantly. Why? And what's your forecast for future hash rate trends?
Zhu Fa: Miners don't react instantly to extreme price volatility. They lack immediate motivation to sell their mined coins. Their operational habits don't involve daily settlements, so the impact on them remains relatively muted. For example, selling at $3,000 this morning versus $5,000 now yields vastly different returns, but miners have no incentive for such high-frequency trading. Typically, miners sell every half-month or once a month—with monthly sales being most common. Since miners operate on a monthly cycle, short-term fluctuations lasting just hours or a day won't trigger immediate reactions. However, looking ahead, hash rate will inevitably decline. If BTC remains stuck between $5,000–$6,000, we estimate 20%–30% of hash rate could shut down due to unprofitability.
AndyHe [Host] Question to Yu Wei [Guest]: If BTC's price fails to rebound quickly, some mining rigs will inevitably shut down—severely impacting mining farm operations. How should mining farms balance their own interests with those of their customers? How can they navigate this crisis?
Yu Wei: Yes, we expect about one-third of mining rigs to shut down—though that doesn't directly translate to an equivalent hash rate drop. This will significantly impact mining farm operations. First, there's currently an oversupply of mining farm capacity relative to the number of operational rigs. Hydro-powered farms are still offline, yet the overall hash rate hasn't fallen, indicating thermal power is sufficient to support current operations. From what I understand, nearly 2 million kW of thermal power capacity remains unused. This oversupply means some farms are struggling to attract tenants this year. Second, many older farms can't meet the operational requirements of newer rigs, resulting in very low contribution rates—a key reason they're having trouble finding clients. High-quality infrastructure naturally attracts business, but not all farms are built to a high standard, which intensifies the competitive pressure to upgrade. Third, the Bitcoin halving is coming in May. But even before the official event, the market has already experienced a price "halving." Another reduction in block rewards will likely cause many farms to fail to attract rigs, or even shut down entirely. Fourth, confidence is eroding. Repeatedly dashed expectations have undermined the confidence of both veteran and new miners, further reducing investment, lowering mining rig production, and leaving farms with fewer rigs to host.
In this environment, the best strategy for manufacturers, mining pools, and miners alike is to cut costs and conserve resources to weather the storm. Mining rigs will persist, but farms must upgrade their facilities to better accommodate next-generation hardware and improve contribution rates. As I've said before, premium locations have a unique appeal. This "pre-halving" adjustment, combined with the official May event, will reshape the mining farm landscape. Future farms can no longer be dirty, chaotic, or substandard. They must be built to host rigs for four-year cycles and adhere to higher operational standards. The industry is moving past its chaotic early phase into an era of standardization. Only those who can lead this transition will survive long-term and capture their share of the rewards.
Community Member Question to Yu Wei [Guest]: If I have a one-year thermal power contract that hasn't expired, and the rigs on-site are currently off, can I negotiate a shutdown?
Yu Wei: In my view, yes—it depends on the specific terms of the electricity agreement between the farm operator and the utility. For informal arrangements, partial shutdowns might be possible. However, feasibility also depends on whether the farm hosts a mix of old and new rigs. If it only has legacy rigs, a complete shutdown becomes much harder: turning everything off would cut all electricity usage, which is a problematic scenario for the farm.
AndyHe [Host] Questions Wang Yan [Guest]: Mr. Wang Yan, as a miner who survived the 2018 crisis, how did you make it through that bear market? What rigs do you hold now, and what are your plans under current conditions?
Wang Yan: Survival is the top priority in a bear market. Miners' main expenses fall into three categories:
1. Mining rig costs: Without leverage, this is a one-time capital investment. Once bought, rigs run until electricity costs exceed mining revenue—then they're shut down. If rigs are idle now, it's just a paper loss; no further cash is flowing out.
2. Mining farm operational costs: For rigs hosted at third-party farms, shutting down stops ongoing payments. However, the farms themselves face severe hardship—idle rigs mean zero revenue while fixed costs remain. For example, grid capacity fees (around ¥0.05/kWh) must be paid monthly regardless of usage. Other fixed costs include O&M, security salaries, and land leases—all significant burdens. Farms operating in shutdown mode bear the greatest challenges. In contrast, self-operated farms with owned rigs have more resilience and relatively lower costs.
3. Reducing investments and non-essential spending during bear markets—and preserving accumulated BTC—positions miners to rebound when bull markets return. I've just shut down all rigs across my 90W/T and 60W/T farms. At current prices, mining isn't economical. Also, pandemic disruptions have halted multi-party trading in Xinjiang, and electricity costs are ¥0.45/kWh—so shutting down is the comfortable choice, eliminating electricity cost anxiety. My future plans depend on BTC's price action or post-halving developments. No definitive decisions can be made right now.
AndyHe [Host] Questions All Three Guests: Given the market's sudden downturn and relentless crypto price declines, are we headed for a mining crisis? If so, beyond shutting down rigs, what better strategies can help miners endure it?
Zhu Fa: I don't believe a mining crisis is inevitable—I hinted at this earlier. S9 rigs have been mining for years and have long recouped their investment. Shutting them down isn't a true crisis. A real crisis would involve widespread shutdowns of newly deployed, high-efficiency rigs.
Yu Wei: BTC price declines reflect market dynamics—not a mining crisis! Let's define a "mining crisis": it occurs only when even the most efficient, competitively positioned rigs generate no profit. Four key factors contribute: (1) sharp BTC price drops; (2) rising hash rate as new rigs displace older models; (3) increased operational costs, including policy-driven electricity hikes; and (4) global regulatory impacts. Only when one or more of these conditions manifest would I call it a crisis.
I've just outlined that definition. However, since mining farm configurations, cost structures, ROI timelines, tenant status, and rig inventories vary widely, tailored recommendations differ.
Nonetheless, we can formulate a holistic strategy. First, minimize electricity transmission losses and maximize rig contribution rates—this is critical. Solving these issues could narrow profitability gaps to about 10%. Such a narrow margin would provide exceptional resilience against price volatility, creating a win-win for miners and farms. Thus, farm optimization and reform are a vital strategic pillar.
Regarding rigs: shutting down older models like the S9 is entirely appropriate. If S9s kept running, farms would have less incentive to buy cutting-edge rigs, and manufacturers would have less impetus to develop next-gen hardware. Phased obsolescence is a natural industry evolution. Whether S9s retire voluntarily or forcibly, it benefits the broader ecosystem. Industry-wide reflection and collaboration remain essential.
Wang Yan: The core focus should be minimizing self-inflicted inefficiencies—whether electricity losses at farms or other operational waste—to keep as many rigs running as possible. Every BTC price decline accompanied by a network difficulty reduction presents an optimal opportunity to accumulate BTC. Conversely, during periods of rapidly increasing difficulty, even with seemingly high nominal earnings, net BTC accumulation is minimal because growing miner participation dilutes per-rig rewards daily.
Therefore, if this approach aligns with your conviction, persistence is key—mine as long as feasible. Obsolescence of outdated rigs is inevitable and natural. Technological progress continues unabated, and hash rate advancements proceed continuously.
AndyHe [Host] Questions All Three Guests: With BTC's price having already "halved" ahead of the official event, is now the optimal time to buy BTC on secondary markets or acquire mining rigs at bottom prices? When do you forecast the mining industry's return to prosperity?
Zhu Fa: It's premature to call this the absolute optimal timing—if everyone rushes in at once, prices may not stay favorable. I estimate it may take roughly one to two years. The current issue is that market sentiment hasn't yet reached sufficient pessimism.
Yu Wei: I'll address this in two parts. The first asks if now is the ideal time to "buy the dip" for BTC or rigs. These are fundamentally different. Why? Because Chinese investors often exhibit a "buy-high" pattern. Regarding BTC itself, I believe prices will eventually rebound—it's just a matter of timing. Provided it doesn't compromise your financial stability, holding BTC long-term is sound advice. Long-term, BTC prices will recover. Precisely when to buy is uncertain, but if you have strong conviction in BTC's value and see current levels as undervalued, then buying now is a prudent decision.
Regarding mining rigs: I personally consider this the optimal buying window. When is the ideal time to mine? Precisely when others aren't—when prices are depressed, and participants fear a crisis. Would you wait until S9s surge to ¥30,000 before buying? That would be buying at the peak. When asset valuations shift—whether BTC price or rig values—they move together. At rock-bottom valuations, choosing to mine is an exceptionally resilient BTC acquisition strategy. Thus, starting mining operations at market lows offers superior risk-adjusted returns compared to direct BTC purchases. If feasible, I recommend acquiring rigs at lows rather than buying BTC outright.
On crypto price expectations, I've said before that I don't think the bull market will start until 2021. Looking at recent trends, the recent price rise was just a mirage—many people thought the early bull run had already begun. But this time, the Bitcoin halving hasn't even happened yet, and the price has already been cut in half. So, I believe the bull market might still need a relatively long time—about a year—to reach its peak. Everyone should be patient and wait a little longer. As long as it doesn't affect your daily life, try to accumulate more BTC when you can. Now is also a good time to consider buying mining rigs, as this approach lets you acquire BTC at a lower cost.
Wang Yan: On the topic of mining rigs—if you have access to cheap electricity, buying during low-price periods is definitely much better than buying when prices are high. However, the best time to buy depends on each person's unique situation, resources, and starting point.
That said, if you're choosing between buying BTC outright and mining it, our team has always favored mining over direct purchases—and the reason is simple: over the same period and under the same conditions, acquiring BTC through mining rigs results in a lower effective cost per coin than buying on the open market. However, in today's specific situation—where mining rig prices haven't fallen and there aren't any major "fire sales"—buying BTC directly might be more cost-effective right now. But such opportunities are extremely rare: in my nearly eight years in this industry, I've only seen this scenario a handful of times—maybe just twice so far. The chances of this happening are very low.
So, everyone should carefully assess their own situation to decide whether buying mining rigs (and mining) or simply accumulating BTC is the better choice. If mining seems too complicated—or if you don't have access to cheap electricity, reliable mining facilities, or trusted, reasonably priced mining farms—then buying BTC directly is perfectly fine. Of course, if you have all the necessary conditions for mining, I still recommend it, as it generally offers a lower cost basis.