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Japan’s GMO Made $2.3 Million Profit in Q2 From its Crypto Business

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Japanese IT giant GMO has reported a profit of 225 million yen – or about $2.3 million USD – from its crypto business in Q2 2018, in net revenue. The money generated from the crypto segment was almost equally split between the exchange and mining business, accounting for 53 and 47 percent respectively.

Revenue Breakdown

Operating costs in Q1 were high, amounting to $21 million in just three months. GMO recorded a small margin of only $2.3 million or 10.95% of operating cost. But they made a net loss of $6.6 million in Q1 2018, albeit this was attributed to the negative revenue that its exchange suffered in the first two months of 2018.

GMO did not offer a breakdown of the operating costs for its crypto business in Q2 2018. However, it did say in the report that a major portion of the operating costs went on the mining side of the crypto business.

The report showed that its expansion into the mining sector had proceeded as planned. In fact, the company was able to record sales of 1.2 billion yen. Despite this, mining profitability declined because of various factors such as BTC price stagnation. Besides that, the increase in hash rate was another factor.

In fact, the GMO mining report released on August 3rd showed that the mining capacity had grown in Q2 2018. For example, the company mined 512 Bitcoin in Q1, compared with 528 in June 2018.

These figures came just after the launch of the 7nm bitcoin miner. This miner has been touted as having higher hashing powers and lower electricity consumption than many other models on the market. Before now, GMOs only profitable quarter from its crypto business was in Q4 2017 when the price of Bitcoin was at $20,000.

About the Mining Rig Business

The B2 7nm mining rig that GMO released was the first of its kind by a Japanese company. Besides that, it was also the first Bitcoin mining device created in Japan and the first to utilize a 7nm semiconductor chip. The Bitmain Antminer S9 uses a 16nm chip. The Halong DragonMint T1 uses a 10 nm chip that is made by Samsung.

GMO believes that its miner is that first one that will supplant Bitmain, which is currently making about 80 percent of all ASIC miners. The CEO of GMO said that he respected Bitmain, but was sure this miner would top all of theirs.

A report in Bloomberg reported that though the 7nm was designed in Japan, it was produced in Taiwan and was most likely made by TSMC. This same company supplies Chinese-based Bitmain with its chips.

Image Credit: Deposit Photos

What do you think about the latest figures released by GMO? Leave us your thoughts in the comment section below.

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