Fintech: The cold, hard facts of bitcoin mining
Soviet military bunkers in Kazakhstan and portable houses in Siberia linked up to the plumbing: Bitcoin mining is moving in some interesting directions that will become even more diverse as China cracks down on its domestic industry.
In a furniture store outside Irkutsk in eastern Siberia, an anarchist in jackboots and a Che Guevara hat is showing Euromoney a bitcoin mining rig hooked up to a bathroom boiler and expressing a hope that it might one day be used to evaporate human waste.
That is not the strangest scene in this article and certainly not the craziest idea – in fact it’s a very good one. But it is illustrative of some of the unusual directions taken by the young, entrepreneurial industry of bitcoin mining.
Mining is the process by which new bitcoin is created and through which transactions among existing bitcoin are recorded and verified on the public ledger known as the blockchain. Miners use microprocessors to solve complex mathematical problems, and the first to do so gets to place the next block on the blockchain, for which they are rewarded with newly released bitcoin.
In theory, anyone can be a miner. All you need is the right kind of processor, called an Asic (application-specific integrated circuit). If you have the most up-to-date equipment, then you can make money from mining, provided the revenue you generate is greater than the cost of the energy you consume in the process.