Another light news week in the mining industry:
- Technode has put together a nice write-up that summarizes some of the current efforts to further decentralize mining away from China. In particular, it focuses on DCG’s Foundry investment arm that is focused on expanding the North American mining presence. Geographic distribution of mining is a hotly debated topic, so this is a good article that can help you get up to speed.
- With Iran’s national currency undergoing a hyperinflation episode, some Iranian experts are hoping to use cryptocurrency mined in the country to fund automobile imports. The Iranian government has permitted mining as a way to bring in foreign capital amid US sanctions. Currently there have been no official talks, but representatives within some of Iran’s free trade zones have expressed interest in meeting with the head of the central bank to discuss this plan.
Here are some headlines from a light news week:
- Nvidia unveiled their new line of 3000 series GPUs set to launch this month. The lineup is reported to be a significant performance leap over the previous generation’s offerings, which has miners interested in their mining capabilities. However, from a price-performance perspective, AMD may still be the frontrunner for miners, as Nvidia’s next gen offerings will come with a premium due to its strong position within the gaming market.
- The Block reports that over 40% of Ethereum (ETH) mining revenue in the month of August came from transaction fees. For comparison, the percentage of revenue from fees was around 10% this May.
This week’s news is dominated by developments on the regulatory front:
- Kazakhstan’s Digital Development Minister says the country is currently negotiating a $714 million USD investment in its cryptocurrency mining sector. As nations evaluate how to regulate the mining industry, large investments from mining firms playing regulatory arbitrage will certainly influence the conversation. In 2019, Kazakh regulators passed tax laws that rendered crypto mining earnings as tax-free provided they were not sold for fiat.
- A draft for a new cryptocurrency bill by the Russian Ministry of Finance is said to outline rules for Russian miners, prohibiting them from getting paid in cryptocurrencies. The bill also includes provisions that would only allow Russian citizens to possess cryptocurrencies if they inherit them or receive them as debtors of a bankrupt company or as compensation for winning a lawsuit.
- Cointelegraph has published a write-up about the geopolitical implications of cryptocurrency mining dominance as nation states take various approaches to dealing with the mining industry within their borders. Because mining is a hugely capital intensive industry, miners prefer jurisdictions with stability and predictability in the longer term. There also appears to be an interest in certain places to court miners to breathe new life into outmoded industry assets.
Here’s this week’s mining news:
- VC firm Digital Currency Group has unveiled its subsidiary, Foundry, that will provide financing and equipment procurement to North American mining ventures through a $100 million fund. They have also been operating their own mining operation under the radar since 2019. DGC believes that there is also a geopolitical implication to their efforts as there appears to be growing concern amongst policymakers about China’s share of global bitcoin production.
- Iran has reportedly shut down over a thousand unlicensed mining farms using subsidized electricity. Mining is currently a legal activity in Iran, though companies must receive a license to set up operations.
- Marathon Patent Group, a US-based publicly listed mining firm has signed a letter of intent to purchase Fastblock Mining, a mining-as-a-service company, for $22 million. Adding Fastblock’s ASICs will increase Marathon’s total output by 208 PH/s. This is in addition to their recently announced delivery of 1,300 ASICs with 1,000 more on the way.
Plenty of mining stories this week:
- It’s monsoon season and heavy rainstorms in China’s Sichuan province have affected the regions mining farms, dropping their average daily hashrate between 10% and 12%. This includes hashrate metrics from four of the world’s top pools: Poolin, F2Pool, BTC.com, and Antpool. While the rain helps generate excess hydroelectric power capacity, the flooding and mudslides can result in mining operations to temporarily pause their operations.
- US Bitcoin mining firm Riot Blockchain has purchased 8,000 additional Bitmain S19 Pro Antminers, due to begin delivery in January 2021 with the final units arriving in April next year. The additional hashing power is expected to bring Riot’s total hashrate to 1.45 EH/s.
- Mining industry expert Kristy-Leigh Minehan has dropped some intriguing info regarding a potential new entrant into the ASIC market. If true, this company’s offering will alleviate the existing supply chain woes plaguing the mining industry while delivering top tier products. We’ll continue to keep an ear to the ground.
- Layer1, the US based mining firm backed by Peter Thiel has been struck with a lawsuit for patent infringement in the Western District Court of Texas. The complaint alleges Layer1 violates a patent filed by Lancium LLC in March 2020 that described a method to shut down or start data centers in real time based on the cost of electricity.