Eight years ago, I was at university studying to become a mathematician. For my entire life, mathematics had been my passion and I was a few short years away from turning it into a promising career. But in 2012 my entire life plan changed. This was the year I first discovered Bitcoin, and from that moment on, it was all I could think about.
I was fascinated by the mathematics behind it, fascinated by the idea of a non-government currency, and fascinated by all the possibilities it could bring to the world. But what really fascinated me the most was the process of mining. How could a network of computers work together to power an entirely new global financial system? How was this network compensated? Who was paying them?
My First Miner
To answer these questions and to satisfy my desire to learn more, at the end of 2012, I set up my very first Bitcoin miner in my dorm room. Every night I would fall asleep to the loud hum of these computers and soon, Bitcoin mining quickly consumed every thought I had.
Our First Commercial Farm
A while later, I left university and along with my partners, we built our first commercial mining farm. It was extremely challenging but was also an incredibly exciting time as a young entrepreneur. There was no playbook on how to build a large-scale mining farm and most of the other miners at that time were hobbyists mining from their basements and garages (or dorm rooms, like me!). Most of what we did, we learned through trial and error. The more time we spent thinking about mining, the more we began to realize why mining matters so much. Bitcoin is not possible without mining. Mining is the backbone of the network that makes it all possible.
The Birth of Genesis Mining
As we researched the mining landscape, a few things became clear to us. First, the industry was rapidly growing and more and more commercial farms like ours were being built. This meant that the ability for someone to profitably mine Bitcoin at home was declining and that power was shifting from the hands of many into the hands of a small group.
Second, a new category of companies was beginning to emerge that offered users the ability to mine Bitcoin via the cloud. But when you dug deeper here, it became clear that nearly all these new companies were made up of bad actors.
Third, there was a growing number of institutional players interested in gaining exposure to Bitcoin by supporting the infrastructure that powered the ecosystem. But when it came to building and managing their own mining farms, they had no one to turn to.
And fourth, the more people that had access to participate in mining, the more the ecosystem would grow.
This eventually led to the formation of our company mission: Bring as many users as possible into the crypto mining ecosystem. Seven years later, I am incredibly proud of what we’ve achieved as an organization to turn that vision into a reality. We’ve bootstrapped our way from that dorm room into a company that employs hundreds across the world. Our hashpower for rent division, which makes up roughly 20% of our business, grew incredibly fast and today serves over two million users. Our R&D team has quietly developed industry-leading innovations for hardware and software that maximize our efficiency when it comes to mining. And our institutional division has helped dozens of billionaires, hedge funds, and other professional investors enter the mining ecosystem.
Has all this been easy? No. Absolutely not. We’ve faced countless crises, made many mistakes, and have had to navigate an industry that’s incredibly volatile. But through it all, we’ve had the incredible opportunity to learn. We know the ins and outs of the entire crypto mining process from start to finish. There is not a single company in the world that has more experience than we do when it comes to building, managing, and scaling crypto mining farms. Today we have twelve datacenters in five countries. Some of the facilities serve our hashpower for rent division, some we manage for our private institutional customers, and the rest are mining farms that mine Bitcoin and other crypto currencies for ourselves.
While it’s largely known that we are a big miner, there’s one thing we’ve never said publicly, until now:
We mine Bitcoin, but very rarely sell.
Since 2013, apart from the small percentage we’ve sold to cover our electricity bills and other datacenter operating costs, we’ve never sold any Bitcoin. All the Bitcoin we’ve mined remains securely tucked away in cold storage and we have no intention of touching it anytime soon. Every day, our Bitcoin holdings grow. But no matter what happened in the industry, we’ve maintained our commitment to hold. And that’s not changing anytime soon.
Why We Hold
In 2015, I wrote an article titled “5 Reason Why I Am Bullish About Bitcoin.” Today, I am more bullish than ever. In recent weeks we’ve watched as governments around the world fire up their money printers and pump new money into the system. The US alone has added over two trillion dollars to stimulate the economy. All of this printing will lead to massive inflation. As billionaire investor Paul Tudor Jones said:
“If you take cash, on the other hand [from Bitcoin], and you think about it from a purchasing power standpoint, if you own cash in the world today, you know your central bank has an avowed goal of depreciating its value 2% per year. So you have, in essence, a wasting asset in your hands.”
Until recently, the fear of inflation was not a real day-to-day concern in the Western world like it is for those in countries like Zimbabwe, who infamously saw inflation lead to trillion dollar note denominations.
But all that is changing. As more and more money is printed out of thin air, more people are finally starting to ask, Where exactly is this money coming from?
The benefit of being non-government-backed will become more appealing to more people in the years to come. At some point in time, we will face grave consequences for the actions taken over the years by our governments — not just the actions in recent months, but the actions taken over the past hundred years that created our entire flawed financial system.
Bitcoin is a hedge against this all. It’s controlled by math, not a central bank. Not a politician. Not a government. Math. We believe that in our lifetimes we will witness the fall of government-backed currencies and the fall of many governments as we know them. This will not just happen in third-world countries. This will happen to countries that are recognized as global leaders.
While this may sound crazy and that I am being an alarmist, take a moment to reflect on the past few months. At the start of this year, would you ever have believed a virus would put the entire global economy on hold? Would you have believed that governments around the world would order businesses closed and their citizens to stay inside? If you are like most, myself included, everything that we are seeing today would have been hard to predict even just a few months ago.
That’s why I am a bull. And that’s not going to change. I accept the risks that come along with being on the front lines because I believe in all the potential this industry has to offer. I’ve been through bull markets and I’ve been through bear markets many times over the years. I know where they end up. With this most recent halving behind us, many are focused on the short term price impact. Our belief is that the price today is irrelevant. It doesn’t matter. It may go up, it may go down. But focusing on the short term is not the point.
I encourage you to remind yourself what brought you here in the first place and to really consider where you think the industry is today. Look at the fundamentals, look at the problems the world is facing, and look at all the promise Bitcoin can bring to the world. Then you can decide from there. I’ve already decided. I think we’re still headed to the moon. And despite all the risks, stress, and pain that will likely happen along the way, I’m ready for it.
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