menu
search

Podcasts: Bitcoin Mining in Distress with Nick Hansen 🔗 1 year ago

What Bitcoin Did

“This time last year, most profitable time to mine ever in Bitcoin; people shovelling money in as quickly as they can. Less than 12 months later, it’s the least profitable time to mine ever. It’s very difficult to make massive strategic pivots in that amount of time.”
— Nick Hansen

Nick Hansen is the CEO of Bitcoin mining software firm Luxor Technologies. In this interview, we discuss the distress within the Bitcoin mining industry caused by a perfect storm of leverage, stagnant value, huge growth in capacity, energy price shocks and wider headwinds affecting investment. This could become a national security issue.

- - - - 

Exactly one year ago, US Bitcoin mining companies were posting record quarterly profits. A huge amount of investment followed China’s mining ban making North America the centre of global Bitcoin mining. It spurred the development of mega miners: companies developing industrial-scale operations. These companies started building out new sources of energy and developing unique relationships with grid operators. And Bitcoin’s price was at an ATH.

Roll on one year, and the industry is facing a potential crisis. Bitcoin price is at 2-year lows, the hash rate is at an all-time high, investment is drying up due to a range of issues, rig prices have tanked, whilst a swath of companies are struggling to manage debt obligations. Add to this the wider fallout as a result of the FTX collapse. It really is a perfect storm. 

At the same time, companies are being buffeted by widespread disinformation, and polarised attacks predicated on energy usage concerns. Regulators seeking to acquiesce to those promoting FUD, have considered, recommended, and brought forward poorly designed rules. See the NY moratorium on PoW mining using fossil fuels just passed into law. 

This is more than a parochial issue for the Bitcoin community. Bitcoin mining provides an unprecedented opportunity for wider society. It’s the basis for an alternative to a broken economic system and the means with which to incentivise and support the energy transition at scale. It is the industry to help the US navigate a host of strategic problems. Bitcoin mining is, fundamentally, a national security issue. Its protection should be our primary focus.

- - - -

This episode’s sponsors:
Gemini - Buy Bitcoin instantly
Ledn - Financial services for Bitcoin hodlers
Bitcasino - The Future of Gaming is here
Fidelity - Careers in crypto
Ledger- State of the art Bitcoin hardware wallet
Wasabi Wallet - Privacy by default
BCB Group - Global digital financial Services


-----

WBD585 - Show Notes

-----

If you enjoy The What Bitcoin Did Podcast you can help support the show by doing the following:

Become a Patronand get access to shows early or help contribute

Make a tip:
Bitcoin: 3FiC6w7eb3dkcaNHMAnj39ANTAkv8Ufi2S
QR Codes: Bitcoin
If you do send a tip then please email me so that I can say thank you

Subscribe on iTunes | Spotify | Stitcher | SoundCloud | YouTube | Deezer| TuneIn | RSS Feed

Leave a review on iTunes

Share the show and episodes with your friends and family

Subscribe to the newsletter on my website

Follow me on Twitter Personal | Twitter Podcast | Instagram | Medium|YouTube

If you are interested in sponsoring the show, you can read more about that here or please feel free to drop me an email to discuss options.

More from this author

27th March 2024 11:26

22nd March 2024 01:15

20th March 2024 07:58

18th March 2024 08:45

16th March 2024 06:47

14th March 2024 05:32

12th March 2024 04:28

9th March 2024 12:24

7th March 2024 01:13

Feel free to send a tip using tippin.me

Or alternatively you can send a few sats directly:

btc logo BTC ln logo BTC (Lightning)

btc tip qr

33ELQ1ye29gB6YVQY6zRLFVCNYkJez9jMh

lightning tip qr

lnurl1dp68gurn8ghj7cm0d9hxxmmjdejhytnfduhkcmn4wfkz7urp0yhn2vryv5ukvdm995ckydph956rvv3h94sk2dny95mkgv34xdsnvvrpv4jxz6whyrn