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Inside a Chinese Bitcoin Mine That's Grossing $1.5M a Month (vice.com)
146 points by wr1472 on Feb 8, 2015 | hide | past | web | favorite | 98 comments



One comment which I haven't seen come up much is bitcoin mining doesn't actually have to be "profitable" to be useful. For example, if you live in a country that has restrictions to prevent capital flight (i.e. extra taxes on money transfers to foreign accounts, etc...), ignoring the potential criminality implications, mining bitcoins at a "forex loss" and transferring those bitcoins may still be a better net financial option than just transferring the money in whatever your native currency is.

I believe China used to have some pretty significant restrictions to prevent capital flight - I wonder if that has something to do with this mining operation.


This is actually a remarkably good point. The key concept here is that Bitcoin mining -- even at a "Forex loss" -- will essentially trade electricity for Bitcoins, which can be used to purchase other currencies. Depending on what the miner values their local currency at, this can still make financial sense.

As an example: suppose you are a resident of country X, and you have 1000 XUnits that are valued at 1000 USD, but there are capital flight restrictions such that you can exchange your 1000 XUnits for only 300 USD. And suppose that you need to exchange your XUnits to USD, for whatever reason. You then use your XUnits to buy electricity and mining hardware, and generate Bitcoins, and sell them for 750 USD.

Note that you could try to do the same with e.g. steel, barrels of oil, or widgets, but with hardware you'd be subject to import/export taxes, and the entire operation would have much higher overhead costs (comparatively, setting up a mining farm is pretty cheap).


Why not just buy Bitcoin directly? There's no requirement to mine these things in the first place if all you want to do is exchange them.

Someone could fly in via Hong Kong with a piece of paper that could unlock $100MM of BTC and nobody would know.

Meanwhile building a gigantic BTC mining facility will not go unnoticed.


You can only do that if you find a person with bitcoins that wants to exchange then for yuan located in China.

Not an impossible scenario, but it might not be the most reliable.


Because the local currency would have to go trough the banking systems and if the seller's account is in any other country, then exchange restrictions are applied just the same.


They have paper money, which you can exchange for BTC. Money exchangers have been doing this for centuries with different commodities to skirt around regulations, and BTC, gold, or jade figurines are all the same at the end of the day if there's an agreed value for them.


Well, yes.. but the person giving you paper money in exchange for BTC will make their own exchange rate based on the capital risk incurred in transacting volatile goods, which is very different than transacting gold or jade figurines. Unless of course you meet a BTC collector who has no immediate plans on capitalizing on his investment.


You can do that with US Dollars. It's more complicated with Chinese Yuan.


If you think about it, it's basically a tariff and tax free way to export electricity to any part of the globe.


I think that's taking the abstraction a step too far. ;)


Also in some places you can probably [illegally] bypass the electric meter and leech someone else's electric supply - with bitcoin you can cash that electric in as money. Having seen images of the ratsnests of cables that festoon the pylons in some areas of China I can imagine it might be relatively easy to hookup a couple of jumpers and get some "free" bitcoins.


China may be a developing country, but it's not a messy place where people steal electricity like in much poorer south east asian countries.

Electricity is very reasonably priced (especially in rather rural areas where the factory is based) and there are tons of people with money in China that are always looking for potential high yield investments - sometimes with cash that cannot be invested in ventures that can be traced back to them due to it's dubious origins.


I was thinking this sort of thing,http://blogs.ft.com/photo-diary/files/2014/09/electric.jpg - but thinking about it China shouldn't have the issues with multiple utility companies hanging their wiring everywhere, perhaps I mis-remembered and it was another country.

Here's one from Kathmandu, http://www.canstockphoto.com/tangled-electric-cables-5050998....

>not a messy place where people steal electricity //

FWIW I wasn't suggesting that such a place be messy, the cause of this sort of cabling [dis]arrangement isn't related to hygiene; nor that Chinese are more prone to steal electricity just that complicated webs of cabling (as in that Kathmandu photo) could make it difficult to tell easily that someone had put in an extra line.


Bitcoin is a lousy medium for illegal activity. Every transaction is logged for all eternity just waiting to be de-anonymized.

Besides, Singapore implemented this functionality long ago. Sell Chinese goods at breakeven (or even a loss) to a corporation in Singapore, which realizes the profits. Singapore is the busiest trans-shipment port in the world [1].

[1] http://en.wikipedia.org/wiki/Port_of_Singapore


Do you really think while China has been booming economically for decades - that those with money still didn't know how to off-shore it and were waiting like a bunch of patient school boys for the solution that is bitcoin?

Buying bitcoin might have made sense for a regular chinese lee, but it cannot actually handle any real transaction demands.


Doesn't matter if they already have the means; always helps to have a Plan-B... or C, D, E and F. I also suspect that not everyone knows every trick and/or some people are more comfortable with certain methods than others.


The past was the past. Huge crackdown on corruption and graft is making it much harder to offshore. Even if they can get it out, people are watching their spending habits outside of China.


I'm Chinese and I don't think this is the case. Investing in mining bitcoins is just like investing in any other industries, in its nature. The reason why some Chinese businessmen prefer this over the others is that it's newer, less competitive, cheaper, more global and under no governmental regulation at all, which makes it a business-as-u-go or a gamble with great odds. Chinese are good at these kinds of things.


So since this video was made, the price has gone down by approx 35% and the difficulty has gone up by approximately 17%, for a total adjustment in revenue of about 50%, unless they added more machines, or upgraded their current ones. That's pretty brutal.

Ultimately (and not long from now if these rates of adjustment continue), mining will be a commodity business with a very small profit margin. When you consider that there are uses for low grade heat (like home and office heating), once the ASICs catch up with Moore's law, it seems likely that the profitability will be slightly negative for someone trying to run this kind of business. (As another reason, there will probably be people who have access to basically free electricity that would have been wasted, and just need to amortize the cost of the ASICS).

However, because mining is a zero sum game, we can conclude that the profitability of mining was very high at the time of the making of this video, or else the margins wouldn't have been able to drop as much as they did. This says that a rational large investor would choose to put their money into mining rather than directly buying bitcoins, if they were interested in getting into this space. That's probably why the price has been falling since the peak early last year.


> there will probably be people who have access to basically free electricity that would have been wasted, and just need to amortize the cost of the ASICS

That's a really interesting point. I wonder if we'll see utility companies get into bitcoin mining as a way of profiting from their excess capacity during non-peak times.


Microsoft ran heaters at Quincy to avoid a contractual obligation. They could run ASICs.

http://www.nytimes.com/2012/09/24/technology/data-centers-in...

Then came a showdown late last year between the utility and Microsoft, whose hardball tactics shocked some local officials.

In an attempt to erase a $210,000 penalty the utility said the company owed for overestimating its power use, Microsoft proceeded to simply waste millions of watts of electricity, records show.


Use quotes, please. Those aren't your own words.

And, the utility put Microsoft in the position of wasting $70,000 of power or paying a $210,000 fine.

Exactly what did they EXPECT was going to happen?

As much as I like to slag Microsoft, any rational human being is going to react that way when presented with those incentives.


That article is pretty damning of the power company, not Microsoft. They issued a fine for not using as much electricity as they estimated, what's the logic there? And then the "utility commissioner" (unclear if he works for the utility itself or not) has the gall to blast them for "not being green"? Plus they are trying to paint the narrative as a "megacorp vs aw-shucks local farmers" that just rings hollow in light of the company's exorbitant fine.


The reason why this is done is because major industrial customers (e.g. data centers) often require upgrades to utility-owned infrastructure when they set up shop. Utilities will typically require what they call a 3rd party capital contribution (i.e. upfront cash payment) for some portion of the total cost, with the remainder to be recovered via their margin on the additional electricity consumed over the lifetime of the facility. You would also have the option of paying the full cost and making no commitment as to whether you'd actually use it.

If a customer moves in and says "oh yeah, I'm gonna need an average of 100 MW 24/7 for the next 20 years" and then turns out to only use half that, the utility is now short a bunch of a money that it spent upgrading its distribution infrastructure for that customer's supposed needs.


Yeah, that's fine if you had a contract committing to a certain minimum, but any ideas how they are justifying asking for 3x the difference though?


I've heard that spot electric prices can occasionally go negative if demand dips faster than power plants can ramp down. I don't know if that's worth exploiting with Bitcoin, since it's difficult enough for ASICs to pay for themselves even when running continuously.


For calculating if ASICs are worth it, you should probably consider that energy to be free, as you can invest a relativly trivial amount of money into electicity wasting devices.


I don't quite see ConEd getting into Bitcoin mining :) However, it's possible for an entrepreneur to get discount off electricity during non-peak times.


High frequency traders have colocated their machines directly inside stock exchanges to take advantage of the low time latency. I wonder if there's any potential to be had in power stations offering colocation services for customers with very specific uses for either "low latency" excess power or much cheaper power (since it hasn't had to be transported anywhere or had any losses).


I don't think mining was ever that profitable once it reached industrial scale (it was always a bet on the future, in which case having actual bitcoins is significantly more fungible).

There is a reason cex.io / ghash.io (the biggest mining pool) contracted out their hash power to other suckers (err I mean buyers) instead of mining themselves.


I used to know a fairly small miner, ~$2,000 a month turnover, who managed to rig his ASIC up to his heat pump in such a way that is heated his house and cooled the card. He lived in a fairly big house and it was always toasty even in the middle of winter.

It might still make sense for some people even when the margins are small


Oh I'm sure it might make sense even for a big operation, if there are special conditions or clever tricks that allow for cheap electricity and/or tax breaks. All I was saying is that in and of-itself mining was not a profitable strategy once it became large-scale.


So he was successfully mining several bitcoins a month with 1 ASIC? What year was this?


It was last year, to be honest I'm not too sure of his setup. All I know is he set up the exhaust to heat his house


"the 400 bitcoin millionaires with at least BTC2,000 hold 40% of bitcoins" from https://bitcointalk.org/index.php?topic=316297.0

This is the main reason I'm highly skeptical of bitcoin, not to mention wildly fluctuating value, little if any privacy gains (http://www.forbes.com/sites/timothylee/2011/07/14/how-privat...), and a host of other problems.


[deleted]


What? Talk about moving the goalposts. This argument doesn't make any sense at all. Following your same logic, the Segway was a rousing success: It might not last forever, but thousands of tourists and mall cops around the world ride it every day.

To put another way: I don't think anyone was skeptical that bitcoin was a clever (if terribly inefficient) technical demonstration, and that it has some limited utility for facilitating the purchase of illegal goods online. What we've all been skeptical (and rightly remain skeptical) of are the grandiose claims made by bitcoin believers: That it will revolutionize the global economy, that it will displace the USD as the global reserve currency, that it is The Future of Money (tm), etc.


[deleted]


0.30 to 1200.00 within just 5 years is already more grandiose than any of us could have ever imagined.

Not really, given the claims. I've seen people predicting values of $10,000+ for bitcoin years ago. If it actually does become the default currency, and there are only 21 million available, it's not hard to imagine very high valuations, and people do.


According to Reddit, the mine in question has been shut down already:

http://www.reddit.com/r/Bitcoin/comments/2v02n9/life_inside_...


That isn't surprising.

You can deduce from the video that their utility rate is ~$0.09/kWh.

That's substantially higher than other major bitcoin miners are paying.


yeah, he describes in the video how Dalian is a nicer location than the other buildings they operate. I imagine given the lower profits they could no longer afford the luxury.


Very misleading title. It's grossing $1.5M per month. You still need to subtract operating costs, which will be substantial in a bitcoin mine. I'm sure power/land/cooling/etc is cheaper in rural China than many other places in the world, but there's no way it's free.


$80,000 per month electricity bill is mentioned in the video. Sheesh.


$80K per site. They are running six sites = $480K


Thanks, we updated the title to be less misleading. The article states, "... generated 4,050 bitcoins a month, equivalent to a monthly gross of $1.5 million".


Not to mention they should've just mentioned 4000 BTC/month, instead of matching it with an USD price. Bitcoin is a currency, its USD value is highly volatile.


But also that changes as the difficulty factor increases.


It's not really misleading since they say "grossing" 1.5M per month.


They changed the title, it used to say "making".


I propose a convention of quoting the existing title when complaining about it so that later readers know what you are talking about.

Maybe a similar one for complaints about the other comments, too, although that's harder. Need snapshots, really.


What we need is a moderator action log like that on lobste.rs, or even a simple (edited) indicator on article titles. At the moment the titles magically change under our feet with no visibility, and everyone gets confused.


I agree with you. Even a simple asterisk like reddit has with edited comments would at least indicate that it's been changed. Perhaps a hover over the title shows the last known title?


Let's not forget the likely multi-million dollar hardware investment as well. They have 3,000 ASIC miners (although investing in mining equipment that can be used for mining multiple currencies is far better imo than simply buying Bitcoins).


It's what they were making per month in October 2014. How is that misleading? Their costs don't appear to be that substantial if you watch the video.


Was making $1.5mm, in October of last year. There are some off the cuff calculations in the reddit thread [0] that indicate the same setup would currently be netting only about a tenth of that amount now.

0 - http://www.reddit.com/r/Bitcoin/comments/2v02n9/life_inside_...


Based on the video, it looks like these guys likely swap out for the newest equipment as soon as it makes sense economically.

If I were making such an investment, I'd think carefully about the rate of computational depreciation (which is predictable) and probably hedge on the price of power. The only unpredictable thing in this setup is the price of bitcoin, which I believe they're extremely bullish on long term. You could probably figure out a way to hedge that, too, if you could find someone to take the action.


What a depressing business. Making money out of noise, and warm air ...


True enough, but how does it compare to literal mining, as in gold mines? I would guess that Bitcoin mining is greener.


The difference being that the gold was put there by natural processes, whereas bitcoins are purely artificial. It's more like spending a lot of money to win an easter egg hunt.


A pretty arbitrary distinction, if you ask me.


Not at all. If the whole process is human-controlled, then we can change it, whereas the gold's going to be wherever gold's going to be.

Suppose somebody spends a lot of money hiding easter eggs, and then I spend a lot of money finding and getting the eggs. We can both save a lot of money by them just giving me the eggs.


Gold miners have incentives to be more efficient about it. And realistically the 21st-century alternative isn't gold bullion, it's Visa - which I'd submit is a whole lot greener.


I remember this one post on HN some time ago, where someone calculated how much electricity the entire Bitcoin network was using per month...and then someone who runs operations at a large coal mine came around and said that his mine uses that much electricity....daily.


Well, coal is different. It's mined for energy, not store of value. But I suppose gold and silver would be in the same ballpark.


I believe Bitcoin miners have every incentive to be efficient, as they pay for their hardware and energy. Am I missing something?


If bitcoin mining becomes more efficient, miners run more of them, the hashrate increases, the difficulty goes up, and we reach a new equilibrium - with the same overall amount of value being created, and therefore assuming efficient market, the same amount of energy being expended. The blockchain is worth the same whatever the hashrate (at least if we're just talking about more efficient miners - if more effort is being put into mining then the blockchain becomes more secure, but if someone makes a more efficient miner then that same miner also makes attacks easier).

In contrast when gold mining gets more efficient, either we expend less energy, or we produce more industrially-useful gold. Admittedly in the limit where people are just buying gold and putting it on the shelf I guess the same considerations as bitcoin apply? Hmm.


The value of gold mining is gold, which has various personal and technical uses. The value of Bitcoin mining is to support the blockchain. The value of which is, honestly, still unknown, but so far appears mainly to be transferring money.

So if we're measuring ecological efficiency of Bitcoin, it'd be something like cents or watt-hours or grams CO2 per financial transaction. I've never seen a rigorous comparison, but I wouldn't be at all surprised if Visa and Paypal are more ecologically efficient than Bitcoin.


And what do we do with most gold?

We store it in vaults...


No, we mostly make it into jewelry. It also has various industrial uses. Like any commodity, some of it ends up getting stored. And some of it also serves as a shelf-stable form of collateral. But mostly it gets used:

http://geology.com/minerals/gold/uses-of-gold.shtml

I suspect that even a lot of the "investment" uses of gold are much more about human emotional needs. I helped someone sort out the house of a deceased elderly relative. There was quite a bit of stuff purchased and stored away: coins, silver, gold. A number were of the Franklin Mint variety, where they wildly overprice the metal:

http://coins.thefuntimesguide.com/2008/11/franklin_mint_coin...

I'm sure the guy was happy with his purchase, but as investments go it was a terrible idea. He would have been much better off putting his money in index funds.


No, gold miners have incentives to maximise their profit, which is different from maximising their efficiency. Take, for example, the typical refining process for low grade ore[1]. This occurs in a lot of developing countries, and involves chucking all of the ore on the ground, then leaching it with cyanide... which then runs off into the nearest river.

Gold mining and refining can be nasty stuff.

[1] http://en.wikipedia.org/wiki/Gold_cyanidation


You don't have to get away from the crypto currencys just because you dont like mining. Look at Delegated Proof of Stake System that has been used by some crypto currencies like Bitshares. You get all and more of the benefits of Bitcoin and Visa.


And processing transactions. And increasing security.


Increasing security how?

It seems a pointless waste of electricity and human effort, but justifiable with the current bitcoin prices.


The security of the whole system depends on no one entity controlling >50% of the hash rate in the whole network (that is, the energy being used to mine). Further attackers with below 50% can impact the blockchain with a lower probability of success.

More information better written at [0] and [1], but they'd be able to reverse their own transactions (and double spend), and also stop any other transactions being confirmed.

So essentially these miners are making it more difficult for anybody to attack the blockchain, thus they're providing security.

[0] http://bitcoin.stackexchange.com/questions/658/what-can-an-a... [1] https://en.bitcoin.it/wiki/Weaknesses#Attacker_has_a_lot_of_...


True, I had forgotten about this aspect.

Of course, this only works if they're (or someone else is) not big enough to control more than 50% of the hash rate (not sure how much they would have to grow to do that)


You don't need miners to process transactions.


> And increasing security.

Only for the Bitcoin network, which is like saying that putting a fence and armed guards around a plot of industrial wasteland is inherently good because it increases security.


If there wasn't demand for Bitcoin (no matter how misguided you might think that demand is), Bitcoin would not be worth anything, and so mining it would be pointless as it would get you something that is not worth anything.


You can create demand for anything with enough hype.


Sure. Bitcoin provides value for criminals (it may provide a little value for some legitimate use cases, but they're very marginal in comparison to the criminal uses). Those running the system are providing a service to criminals and receive a proportion of their criminal profits in return. Still a very depressing business.


That's like blaming cash for crime, it's just ignorant.


I'm not a BTC enthusiast... but it's no less wasteful than Fort Knox.


Fort Knox is fairly economical. While obviously the depository and its guards cost something, most of the security is circumstantial: Fort Knox is an active US military base in the middle of the continent.

The fear at the time was that the Germans could do a stealth smash-and-grab on New York and steal all of our gold. So they moved it all across a mountain range to the middle of an Army base (in fact, they used to train tank crews there). Even in peace-time, the prospect of being chased by the entire US military across a thousand miles of US territory is sufficiently daunting that the depository itself doesn't need to be that impressive.


The overheads of the existing financial industry aren't really things for physical security at Fort Knox. They are:

• All the employees, regulators and effort put into the auditing and compliance needed to make fractional reserve lending slightly less risky

• The leakage and losses due to carding fraud which goes unfixed because banks have little incentive to fix it

• The mind-blowing resource misallocations that result from misguided but well intentioned economic interventions, like the Spanish housing estates that were built then knocked down without ever being occupied ...

and so on.

Yes, Bitcoin mining is pretty wasteful today. It's a misallocation of resources caused by monetary inflation - the fact that you get to print money by solving SHA256 preimage puzzles diverts lots of energy and effort into doing so even though it makes no real sense. But Satoshi knew inflation caused harmful resource misallocation which is why he scheduled it to halve every four years (some inflation at the start is needed to actually issue the currency into existence, of course).

Now think about the wastefulness of mining, but on a massively larger scale, and without any end in sight. That's other currencies.


I'm curious why you think inflation is harmful? Most (all?) economist think that slight inflation is beneficial.


Inflation is extremely harmful in the long term. Deflation is harmful in the short term. When you get a deflationary spiral, the shock to the economic system is sharp and sudden, and causes political/social unrest, economic upheaval, capital flight and sometimes horrendous wars.

Inflation on the other hand, in the long term, guarantees bifurcation of rich and poor (wealth disparity). The reason for this is fairly simple. The poor spend between 100 and 110 percent of their disposable income, and they spend it on consumption. The rich, on the other hand, invest at least 10 percent of their disposable income in some kind of asset, either fixed assets or financial assets. Assets can then be used as collateral against loans which are used to purchase more assets. Inflation erodes the real value of the loan i.e. the nominal principal of the loan does not inflate, but it's real value deflates with inflation. Thus, inflation is a virtuous circle of asset ownership, which gives access to credit, which both increases assets owned, and whose liability decreases with inflation.

To put it another way, never ending inflation is a transfer mechanism of wealth from the poor to the rich. Once the poor realise this, they demand a political solution. The political solution inevitably involves increasing taxes on the middle class (the rich don't pay taxes), to pay for social welfare programs (i.e. free money). In this way, inflation not only transfers wealth from the poor to the rich, it also indirectly destroys the middle class by crushing them with a punitive tax burden to placate the poor.


Intrest rates generally take into account inflation (the rate should be greater than anticipated inflation as part of risk) unless there is a consumption deficit (e.g. China can't use all the dollars it earns without overhearing their own economy so it lends them back to the US at a small loss; the US's role as debtor of last resort is what makes the dollar appealing as a reserve currency).

If you have savings and investments, inflation puts pressure on you to make them perform, otherwise you are losing money; it works like a capital tax in that regard. You just can't sit on it since money can't really be saved without someone else borrowing it (production and consumption have to even out at the end of the day!). So no, the rich don't really get richer off inflation. They aren't brorowing money from the poor at any rate.


I think I may have not been clear, or I am misinterpreting your post.

If you think of a person as having a balance sheet, with assets (property, shares, bonds, cash) and liabilities (loans), and a profit and loss of revenues (salary, dividends, coupons, rents, i.e cashflows) and expenses (food, shelter, clothing, transport, interest etc), then inflation:

* increases the value of your assets => asset prices rise with inflation

* decreases your liabilities => loan balances stay constant in nominal terms, but in real terms the liability is decreasing.

* increases your income => wages and salaries rise with inflation

* increases your expenses => the price of consumables increases with inflation.

So, ideally, in a high inflation environment, you want to hold as many assets as you can afford, levered as much as possible, with a high income, and low expenses.

So the rich purchase assets with debt. Inflation pushes the price of assets up, and the real value of the debt down. I agree that the assets you purchase should generate a cashflow to cover the financing drag. Inflation also increases dividends, rents and coupons.

Because the poor have expenses (outgoings) equal to or greater than income (wages, salary), price inflation erodes their disposable income, and price inflation is elastic, but wages are sticky, so the poor are always playing catchup, and in the interim, the rich are buying up their assets with cheap debt.


The poor have nothing to protect from inflation: they don't have significant savings, they spend their income the day/week/month that they get it. Their wages should go up to match inflation, and if they don't, its not really related to inflation itself but stingy bosses who aren't sharing increased prices (since given inflation, prices are supposed to rise, right?).

The rich are both lending and borrowing money; again, who do you think they are borrowing money from? Who are they buying the assets from? Again, it is not the poor, unless you are suggesting they are accumulating previously non-existing or non-utilized assets?


Stingy bosses has got nothing to do with it. Those who control the means of production can set their prices. The poor's only means of rising wages is through force (either government intervention or strike action). Any wage increase they receive is eaten by inflation. If prices started deflating, it is the poor who would immediately benefit and the rich would immediately be worse off. This is why the rich lobby politicians and academics to maintain inflation at any cost. Once prices start deflating, the immediate effect is relief for the poor and credit stress for the rich. The poor have no savings because they are inflated away. Look at the GINI index for the US and Japan during the "lost decades". In deflationary Japan, the index contracted (i.e. wealth disparity declined), in the inflationary US, it increased.

The rich are not borrowing from each other. Banks create money endogenously. They are buying existing assets from each other, and they are also buying new assets as they are created. Without inflation, asset purchases would look less attractive on a cash return basis, so inflation does serve that purpose. However, persistent inflation is forcing the market to be investors when they may want to save or spend.


Comparing to amount of waste (cost of operations) of regular banking system and direct harm from banking system to society (influencing politics, strong-arming rest of players on the market), cost of bitcoin as network is a chump change. I'm not saying that it replaces banking system and two numbers should not be compared directly, but I believe that it can heal it banking system by introducing greater transparency and taking away control of money from banks.


Well, it's about as depressing as assigning arbitrary value to gold or silver (or paper!) and using it as money.


What a naive comment...


Explain how he's wrong ?


And with current bitcoin prices they are now down to less than a million per month. These are the perils of bitcoin mining.


I wonder if they get new ASIC designs before they ship to consumers. I'm remembering buying mining ASIC and then actually getting shipped them much much later. We thought at the time that they were being held back and 'burned in' at a big mine run by the manufacturers mates. This would explain why they are so hush hush about where the devices come from...

If the ASICs already bought and shipped to consumers later, they would be effectively free!

Alternatively they might be using the low chips that failed QC and never shipped - they might burn out eventually but if you are running them yourself you can be prepared for that.


The thing that interested me the most about this video was when they interviewed him on his thoughts of the future of bitcoin.

He didn't seem all that enthusiastic about bitcoin's prospects.


A true businessman


BTC is still very overvalued if there is still surplus profit.




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