For ordinary people, Bitcoin is rather mysterious and technology-related. For amateurs, it will surprise them that mining plants are now scattered in remote places like mountains in southwestern region and dessert in the northern China.

Wu guanggeng, the COO of Haobtc said there are more than 20 mining plants in Kangding city, a region 400 kilometers from Sichuan’s capital Chengdu. In kangding, even the local couriers are very familiar with Bitcoin industry. Since 2015, the volume of miners sold in Sichuan province accounts for 30% of China’s total.

an machine room in Kangding’s deep mountain

Then why mining factories all choose the mountainous areas of Sichuan as the location to build the mining equipment? The reason is low cost of electricity. The operation of miners will consume large amount of electricity so related fees become the most important expenses. Kangding is just a place seeing the existence of many hydropower plants. Mining factory owners believe the mountainous area has ample electricity and can better handle the equipment noise so they usually cooperate with local power plants to do the mining.

The profitability

The mining factory owned by Tianjian Network is the largest one in Leshan, a city 159 km from Chengdu. There are over 5800 miners in the 4 plant rooms with a hash power of 40 petahashes. The factory can “mine” 27 Bitcoins per day, which are equivalent to near 200 thousand RMB per day based on current Bitcoin price.

However, the costs are high to earn this sum of money to the extent that nearly half of 200,000 yuan is cost. Naturally, the initial costs covering plants, ventilation, and miners are also very high. According to Tianjian Network, the total investment for its mining plants with 5800 miners exceeded 60 million RMB.

Although profitability of mining factories will be impacted by Bitcoin price, the halving of the reward and mining difficulty, Bitcoin price is still the crucial factor as Bitcoins mined eventually will be sold into the market. The Bitcoin price directly determines the profitability of mining factory.

In 2013 when Bitcoin price hit more than 8,000 RMB /btc the miners has experienced the best environment while numerous mining factories collapsed when Bitcoin price dropped below 800 RMB/btc.

As the halving of the mining rewards, the miner’s owner said miners would be prepared for the issue as the timing can be predicted.

A story of a Techinical staff at the mining plants

Lei Ke used to work at power plants until his boss decided to cooperate with other companies to mine Bitcoins. Lei said he knew nothing about Bitcoin but has to push himself to learn about Bitcoin: Blockchain, hash, encryption…Seldom did Lei care about PBOC’s regulation but now he will keep abreast with the latest move of PBOC. It also takes long time before his father believe his son is not doing something related to Pyramid scheme.

When asked about the future of Bitcoin, Lei said: