Category Archives: Bitmain

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US Defence Department Facility to Become Crypto Mining Data Center

A Nevada-based cryptocurrency investment company is planning to convert a US Department of Defense facility into crypto mining data center.

The company, Wuhan General Group (China) Inc, has seized the opportunity to use the redundant facility, originally called the Defense Department Data Center, for its mining project which will eventually be able to tap into a power supply able to support a total of 1,300 mining rigs.

Amid stiff competition around the world, companies are finding it increasingly difficult to find locations suitable for Bitcoin mining. The US has seen a flurry of activity this year with numerous outmoded plants being readapted for crypto mining.

Many aluminum sites around the country have been readapted towards utilization for mining. Alcoa World Alumina and Chemicals (AWAC), with customers in China, the United States, Europe and Brazil, have notably seen some of their old operational US sites for aluminum processing go.

Bitmain has been creating mining supersites, mining farms on a scale never seen before. Other major cryptocurrency mining firms like Coinmint are also building similar sites. Ramy Kamaneh, Wuhan General Group’s CEO, maintains that it was just a matter of time before the company seized the opportunity to become another overseas company to mine in the US:

“We had planned to build this operation three months ago, but with the bearish cryptocurrency market, we took a step back to reassess our strategy. The decision to wait for market stability was a good one, especially considering many cryptocurrency machines are no longer profitable in the current market.”

Once negotiations have been completed, the first 1,300 rigs will be installed in October, followed by the potential to add 12,000 more rigs in 2019. The initial installation according to the company should create a monthly revenue of USD 3.5 million.

The challenge for industrial-scale crypto mining in the US as the sector moves forwards is to develop more sustainable methods of operating, such as utilizing more hydroelectricity. A good example of how this can be both profitable and ecologically sound is DPW Holdings new Installation at Valatie Falls, New York, and geothermal plants in Iceland.

 

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Aluminium Sites Revamped As Search for Crypto Mining Locations Increase

It appears that old Alcoa aluminium facilities are being put to good use, as one more is now earmarked for cryptocurrency mining.

Alcoa World Alumina and Chemicals (AWAC), with customers in China, the United States, Europe, and Brazil are letting some of their old operational US sites for aluminium processing go. The last to be utilised for a completely different type of product was the company’s aluminium smelting facility in New York State with crypto company Coinmint’s new installation making it one of the world’s largest cryptocurrency mining centers.

The smelting plant in Upstate New York has signed a deal with Coinmint, offering the facility on a 10-year lease, with an option for renewal. The cryptocurrency mining company is investing about USD 700 million into this new facility which is expected to bring in over 150 new jobs to the nearby town of Massena.

Bitmain is now in on the action, using a $500 million investment to construct another facility for crypto mining in Rochdale, Texas. The new operation is said to be viable for 7 years, adding to the local and state economy. According to Bitmain’s press release, the new construction on the old Alcoa Rockdale Operations site is underway and hopefully be ready in early 2019. The new Bitmain facility will be bringing 400 local jobs to the economy in the first 2 years.

The company is already recruiting employees for its data center in Rochdale and is seeking senior management, sales and finance specialists, engineers and technicians. Bitmain also plans to work with local schools and educational programs in order to prime locals for possible employment over the next few years as the data center develops and expands. Jeff Stearns, executive vice president and director of operations at the company, commented:

“Bitmain is truly honored to announce this news and is excited to work with local partners, government and stakeholders in realizing this vision, throughout the initial set-up phase, operations and beyond.”

Amid stiff competition around the world, companies are finding it increasingly difficult to find locations suitable for Bitcoin mining. The revamped Alcoa plant promises to be a boon for this particular local community at least.

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Bitmain Selling Routers That Mine Cryptocurrency

Bitmain is about to launch a USD 18 billion initial public offering (IPO) on the Hong Kong stock exchange and is becoming quite innovative and creative with the devices offered to mine cryptocurrency. Bitmain has released two different models of mining Wi-Fi routers, a router that can mine X11 cryptocurrencies like Dash and a router that can mine blake2b cryptocurrencies like Siacoin.

Once the Wi-Fi routers are connected to the internet, they automatically begin to mine on Bitmain’s Antpool, one of the biggest cryptocurrency mining pools in the world. The blake2b mining router mines Siacoin at 11.54 GH/s while consuming 22.6 W of energy, and the X11 mining router mines Dash, formerly DarkCoin, at 300 MH/s while consuming 24.37 W of energy. The router can be tinkered with to mine other blake2b coins but if users choose to do that then efficiency and performance are no longer guaranteed, likewise for the X11 router.

A Wi-Fi router mining cryptocurrency at all times is an interesting prospect. In places like college dorms and apartments where electricity is included in the rent these routers theoretically might be able to pay for the internet service, especially since they are being sold at the incredibly low rate of less than BTC 0.01 (USD 63 at time of writing) for each mining router.

The cryptocurrency mining router is not the first time a common piece of household technology has been turned into a cryptocurrency mining rig. Canaan, the second largest manufacturer of crypto mining equipment, has created a TV that mines cryptocurrency. A French company, Qarnot, has produced a cryptocurrency mining rig which acts as a heater. This might not really be anything new though, since all cryptocurrency mining equipment generates a lot of heat.

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Bitmain Aiming for $18B IPO, Biggest Crypto-Related IPO in History

Bitmain, the largest manufacturer of Bitcoin and cryptocurrency mining rigs, is aiming for a USD 18 billion initial public offering (IPO) when it launches on the Hong Kong stock exchange in Q4 2018 or Q1 2019. This would be by far the largest cryptocurrency IPO in history.

In general, there aren’t many cryptocurrency or Bitcoin-related stocks and those that do exist have very small capitalization. Bitmain will be the first major Bitcoin- and cryptocurrency-related stock, with a projected opening market cap of USD 40-50 billion, which is actually nearly half of the total Bitcoin market cap at USD 108 billion as of this writing on 12 August 2018. This will be on a similar scale of the some of the biggest IPOs in history, such as Facebook which had a market cap near USD 90 billion during the launch of its stock.

Bitmain just successfully completed a USD 1 billion pre-IPO funding round in rapid fashion, pumping its valuation up to USD 15 billion. This is on the heels of its Series A and Series B funding rounds which pulled in USD 50 million and USD 400 million respectively. These rounds have seen Bitmain’s valuation progressively and rapidly grow in less than a year.

The reason Bitmain has such a high valuation is it is pulling in tremendous profits, after cornering the Bitcoin and cryptocurrency mining markets. Bitmain sells the most equipment for mining, the mining pools Bitmain operates control nearly half of Bitcoin’s total hash rate, and Bitmain has a tremendous stash of Bitcoin’s from its massive in-house mining operation. In total, since 2016 Bitmain has profited USD 2.3 billion, but it is expecting USD 2 billion in profit during 2018 alone.

Bitmain’s best chips released to the public so far are 16 nm, but it has an arsenal of 12 nm, 10 nm, and 7 nm chips for mining it is ready to release to the public. These more powerful chips will increase the efficiency and power of their cryptocurrency mining rigs, reinvigorating sales and dominance over the mining manufacturing market. It can plan this release to be in a slow succession, so it can keep its dominance and profits long term. Its 7 nm chips are approaching the quantum tunneling limit, and it will be difficult to make transistors smaller after that point due to the fundamental nature of physics, so 7 nm Bitmain miners could be the most powerful Bitcoin mining rigs possible.

Bitmain stock will provide a way for investors to invest in the infrastructure of cryptocurrency, an indirect way to invest in Bitcoin.

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Bitmain’s New Texas Mining Facility to Begin US Expansion

China-based cryptocurrency mining hardware company Bitmain has confirmed Rockdale, Texas as its next location to spearhead the way for its takeover of the US.

Texas operations

Rockdale will benefit from Bitmain’s investments totaling over USD 500 million in the following seven years, with plans to launch mining operations in early 2019. The location will employ 400 individuals for the new Texas blockchain data center, offering educational services and training programs for aspiring employees.

The location was described by Bitmain as a ”strategic investment” for the company, putting them in a prime spot to begin expansion plans across the US. The firm confirmed the plans Monday after speculation began circling last month when Dallas News reported Bitmain had purchased an unused smelting facility.

Despite the positive local press acknowledging the benefits of such an investment in a town recently hit by difficult economic times due to the closure of the coal mines, Bitmain and public officials declined to comment until this week. The article hinted however, it was an open secret shared among Rockdale residents.

Job openings for the new site have already reached online listings for those looking to join the firm as it begins its US expansion.

Bitmain’s recent moves

The Texas location follows Bitmain’s approved land lease in Washington State received in April, with the firm planning to set out a large-scale mining operation in the area. The state has, however, received several complaints from residents regarding the sustainability of cryptocurrency mining.

The cheap electricity tariffs have attracted many mining operations to the area, with locals reportedly concerned about the amount of energy being consumed. Some have suggested that an increase in the use of renewable energy resources in the mining process would stem the complaints.

Brazil is also supposedly on the agenda for Bitmain, with one article suggesting the firm is looking to open offices in the country.

Bitmain has already international footholds in Switzerland and Israel where it carries out its mining operations.

 

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Canaan Crypto Mining TV Launched to Catch Bitmain’s Market

The so-called world’s first ever crypto mining TV has just been born, courtesy of the one of the largest makers of Bitcoin mining equipment, Canaan Creative.

South China Morning Post has reported the launch, which the company has stated is a step towards creating a new generation of devices which are linked to blockchain and IoT.

The device is marketed as a smart TV with a difference, enabling the user to tap into a processing output of 2.8 trillion hashes per second. Given that a made-for-purpose rig manufactured by the company can process 11 trillion hashes per second, this is still pretty significant for a TV.

The device is marketed as “AvalonMiner Inside”, although how the company connects their new device to the mystical isle associated with Glastonbury is anyone’s guess. Miners though, if not impressed by the name, will certainly have much to marvel at, according to Canaan. Such features as voice control, real-time Bitcoin mining profitability display and a digital tether to Canaan’s platform allowing users to pay for extras using mined coins.

The project has received some scorn, notably from Bitcoin analyst Xiao Lei who said: “It looks more like hype. It will be more meaningful if these companies are able to embed the mining function into existing major TV brands.”

There is absolutely nothing to say that this may be the way the future takes media hardware.

Canaan applied for an Initial Public Offering (IPO) earlier this year in Hong Kong with the hope of raining in a significant starter fund. At present, Canaan needs to keep one eye on its competitor Bitmain which at present has a huge 70% of the global Bitcoin mining device market. When the company applied for the IPO it stated:

“If we cannot maintain the scale and profitability of our single line of system products and, at the same time, offer new products, our ability to continue to grow will suffer.”

To this end, the company has expressed that it intends to follow up AvalonMiner Inside with further innovations, and break away from simply manufacturing mining chips.

 

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BitMain Discloses In-House Mining Hash Rate

Bitmain, the largest Bitcoin mining equipment manufacturer in the world, is now disclosing its in-house mining operation’s hash rate to the public in real time. This is possibly to quell speculation and allegations that Bitmain controls so much hash rate that they could 51% attack the Bitcoin network, and also to increase transparency ahead of its initial public offering (IPO) on the stock market.

Its most vocal critics, however, have reacted with cynicism and skepticism to Bitmain’s move. A Tweet by Cobra, the pseudonymous owner of Bitcoin.org, was joined in by scores of other users, clearly unconvinced by Bitmain’s statistics.

pic.twitter.com/KKjlfnD6Ca

— Bitcoin Buddha (@thbitcoinbuddha) July 25, 2018

As of this writing on 26 July 2018, Bitmain’s SHA-256 hash rate is 1,692 PH/s, the Ethash hash rate is 340 GH/s, and the Scrypt hash rate is 44 GH/s. These stats are updated every 30 minutes. Currently, the Bitcoin network has a total hash rate of 42,551 PH/s, so Bitmain controls approximately 4% of Bitcoin’s total mining hash rate. At the current block reward of BTC 12.5, this means Bitmain mines BTC 72 per day, worth USD 590,000 at the current market rate of USD 8,200. Worldwide, USD 14.76 million worth of Bitcoin is mined per day.

Bitmain’s scrypt mining hash rate of 44 GH/s is minuscule compared to Litecoin’s overall hash rate of 305,534 GH/s, not to mention that there are many other Scrypt cryptocurrencies besides Litecoin with a large hash rate, so Bitmain controls a drop in the ocean of the global Scrypt hash rate. Likewise, Ethereum’s hash rate is 290,000 GH/s, and Bitmain controls about 0.1% of that.

Clearly, Bitmain has focused its in-house mining operations on Bitcoin, largely ignoring other cryptocurrencies. This is not surprising considering Bitcoin is considered the gold standard of the crypto world; Bitcoin has the best reputation and most liquidity, making it ideal for investment.

Bitmain’s mining pools control a far larger percentage of Bitcoin’s hash rate than the in-house operation. AntPool and BTC.com, owned by Bitmain, control 34% of Bitcoin’s hash rate as of this writing, and Bitmain owns other smaller pools. However, Bitmain only collects a small percentage fee from the total revenue earned by these pools.

Bitmain claims it doesn’t mine with equipment that hasn’t been released to the general public, and has a zero-tolerance policy towards secret mining.

 

 

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Cobra Bitcoin Believes Bitmain Controls 80% of Bitcoin Hash Rate

Cobra Bitcoin, the anonymous yet influential Bitcoin personality, has Tweeted his suspicions that giant mining firm Bitmain controls more than 80% of Bitcoin mining hash rate through mining pools that it owns, which means the network has become dangerously centralized. A co-owner of popular websites bitcoin.org and bitcointalk.org, Cobra is calling for a change of the proof-of-work mining protocol to save Bitcoin.

Bitcoin simply can’t be censorship resistant long term if the hashing power is controlled almost entirely by one entity. You can’t build ‘digital gold’ on something that can be shut down by one man, and needs rapid massive coordinated response amongst *everyone* to counter. pic.twitter.com/nQaBV5VHY4

— Cøbra (@CobraBitcoin) June 19, 2018

Cobra says a significant portion of the mining power from BTC.com, ViaBTC, and AntPool is from Bitmain, in addition to other pools. He says there needs to be a hashing power audit of these three large pools to verify how much is independently owned, in order to confirm if a problem really exists.

Anyone who controls 51% of the Bitcoin mining network’s hash rate could theoretically launch a 51% double spend attack. In this sort of attack, someone who controls most of the mining power on a blockchain network can send cryptocurrency to one address on the original blockchain, and then send the cryptocurrency to another address on a new blockchain that they start mining. Using this method the attacker gets their money back. 51% attacks have been successful on several smaller cryptocurrencies that have low network hash rates.

Some observers have said that the claims Cobra is making are perhaps a bit overdone. First off, there is no proof that Bitmain has a majority of network hash rate, aside from their claims of producing the most cost-effective mining technology. Additionally, Bitmain is deeply invested in Bitcoin – a successful 51% attack on Bitcoin would cause Bitcoin’s price to plummet and ruin the company’s reputation. Bitmain has been profitable for years and is unlikely to jeopardize its position in the industry.

Not only does Cobra want to get rid of the proof-of-work protocol, the online figure wants to get rid of miners completely. He says miners “are the root cause of all of Bitcoin’s problems” and “are no longer useful to the community”.

 

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Bitmain Considering Launching Public Stocks

Founder of Bitmain Technologies, Jihan Wu, said that he is considering launching a publicly-traded Bitmain stock on the Hong Kong or a United States stock exchange via an initial public offering (IPO). Bitmain is a global Bitcoin mining powerhouse, controlling as much as 80% of the market for cryptocurrency mining equipment.

Bitmain’s mining pools, Antpool and BTC.com, control 40% of the global Bitcoin mining network which generates a tremendous amount of money. If Bitmain launches a publicly-traded stock it will be an excellent way for investors to get a share of the flourishing Bitcoin mining industry. Kevin Wang, an analyst at Mizuho Securities Asia, says a Bitmain IPO would generate a lot of attention from Hong Kong investors.

Bitmain is now expanding into artificial intelligence technology, and this is a primary reason why Wu wants to get Bitmain publicly listed on a stock exchange.  The application-specific integrated circuits (ASICs) used for cryptocurrency mining are ideal for the large amount of computations needed for artificial intelligence. An IPO would bring in funding that can be used for artificial intelligence development.

Part of the reason for Bitmain’s move into artificial intelligence is political. Large-scale cryptocurrency trading has been banned in China, and mining may be banned soon too, so Jihan Wu wants to have a ‘Plan B’ so Bitmain can survive. The Chinese government fully supports artificial intelligence development.

Wu says Bitmain is worth USD 12 billion and brought in USD 2.5 billion of revenue last year, and that he and his partner Micree Zhan control 60% of the company. Sequoia Capital and IDG Capital are early investors that own a large portion of Bitmain, and part of the reason Wu wants to launch a publicly-traded stock is so these early investors can cash out.

If successful Bitmain would be the largest cryptocurrency company with a publicly traded stock by far. This would be another major event in cryptocurrency’s transition to mainstream adoption.

 

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ASIC: Resistance Is Futile! Crypto’s Battle a Losing War?

At Consensus 2018, many blockchain software developers viewed Bitmain’s recent launch of their newest Application Specific Integrated Circuit (ASIC) miners as proof of the impending future for all cryptocurrencies. ASIC hardware will soon hit the markets for previously deemed ASIC-resistant cryptocurrencies such as EthereumMonero, and Zcash.

David Vorick, a founder of ASIC manufacturer Obelisk stated:

“I think any GPU-mined coin is going to become an ASIC-mined coin at some point. Bitmain has been pretty methodical about demonstrating this.”

Bitmain is one of the main manufacturers of ASIC miners. Looking at Blockchain.info, Bitmain’s BTC.com and Antpool mining pools also make up an excess of 40% of the hashing power on the network.

Cryptocurrencies to remain completely ASIC-resistant for how long?

Crypto developers believe the advancement in technology surrounding mining will continue to increase at a similar rate as to which the resistant code is developed to combat them.

Most ASIC-resistant algorithms were produced by software engineers with a pre-conceived idea of what custom hardware is capable of, mainly due to their limited understanding of the functionalities of the hardware.

We’ve been hopeful on how long the ASIC resistance will last. Samsung, IBM, and Intel are among the giants who are looking to develop dedicated mining hardware, while established companies such as Bitmain and Bitfury already dominate the market. General purpose technology like CPUs, GPUs, and even DRAM all make sacrifices in efficiency for particular tasks in order to facilitate a wider deployment. To make a comparison, most mobile phones are capable of taking pictures but won’t compare to a standalone camera’s quality as it sacrifices that for portability and other functionalities. For that reason, general purpose hardware will always be limited and will often be superseded by dedicated machinery.

With ASICs being developed so rapidly, they can often slip under the radar in secret mining operations. Several months ago, an ASIC Monero mining operation was exposed which was rumored to have been running since early 2017. It was estimated that the secret ASICs accounted for more than 50% of the hash rate. This kind of network dominance could have led to a 51% attack at any time.

Vorick continues to explain how preventative measures taken by developers only delay the inevitable:

“The strategy of hardforking ASICs off of a network is going to lose potency the more it happens, because chip designers do have the ability to make chips that are flexible, anywhere from slightly flexible to highly flexible, with each piece of flexibility costing only a bit of performance. The Monero devs have committed to keeping the same general structure for the PoW algorithm, and because of that commitment, we believe that you could make a Monero miner capable of surviving hard forks with less than a 5x hit to performance.”

ASIC vs ASIC

ASICs have already got a strong foothold in the network with the future of management rather than mitigation an inevitable reality. Although we have to ask was there ever really a war against ASICs? Nvidia, Intel, and other companies identify their technology as ASICs internally but us as customers are familiar with these products for their more generic use. The main controversial topic surrounding ASICs is more of centralization and network control.

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