Investment Options in Crypto Energy

The hash functions of blockchain networks that are the underlying technology for cryptocurrencies like Bitcoin require quite a lot of server time and considerable electricity.  The Dutch bank ING estimates that a single Bitcoin trade can require as much as energy as is needed to power a house for an entire month.  This puts Bitcoin in the crosshairs of those trying to combat global climate change that most attribute to the over use of fossil fuels for energy production.

The intense energy requirements of blockchain technology have led many to question the sustainability of cryptocurrencies like Bitcoin.  There are a number of solutions that have been proposed to make cryptocurrency mining more environmentally friendly.  In this post we look at a few solutions and how investors can get a taste of cryptocurrency sustainability.

Efficiencies in ‘Industrial’ Mining

Privately held HydroMiner is a pioneer in green mining of crypto transactions.  It is the first company in Europe with an approved capital market prospectus for tokenized securities.  It operates two mining farms in the Austrian Alps where low-cost renewable energy is available from hydroelectric plants. 

HydroMiner is among the new generation of industrialized crypto mining operations that have overtaken the individual miners who started out mining cryptocurrencies from computers in their homes.  Centralization of mining makes it possible to take advantage of renewable energy options that make cryptocurrency mining more environmentally friendly. 

HydroMiner’s equipment is deployed in a custom container to hold all the needed equipment.  The containers are located near hydropower stations that can offer stable power supply.  The company has adopted a GPU miner immersive cooling technology developed by 3M Company  (MMM:  NYSE).  The 3M Novec 4 technology requires 90% less space and 20% less energy than conventional systems.

HydroMiner staged a successful Initial Coin Offering (ICO) in October 2017, a process similar to an initial public offering of common stock.  ICOs began as a means to raise funds to start crytocurrency platforms.  ICOs made it possible for crytocurrency enthusiasts to by-pass conventional funding sources such as venture capital or private equity.  Withdrawing crytocurrencies and converting to fiat can be a daunting process, so investing in an ICO should not be undertaken lightly.  One avenue is Coinbase, a digital currency exchange that brokers exchanges of cryptocurrencies like Bitcoin as well as fiat currencies. 

Tapping into Recycled Energy

Based in Quebec, Canada Heatmine has developed a technology that recycles thermal energy created by computer processors.  Servers create excess heat that can be used in all types of devices like radiators for radiant heating and boilers for water. 

Heatmine has targeting cryptocurrency miners with its heatminng technology.  By powering a hot water system that can heat a building or deliver hot water, the economics of cryptocurrency is altered for the better.  A standard Heatmine unit can heat up to 3,000 square feet of space.  Mining a cryptocurrency creates a large carbon footprint, but by recycling the energy, Heatmine reverses the transgression.

Heatmine has created a new heating unit powered by cryptocurrency miners.  The France-based Qarnot has followed suit with its QC-1 cryptoheater.  Qarnot has combined a crytocurrency mining unit to a wall-mounted radiator for home heating.  Quarnot markets the unit as a ‘plug and play’ solution for residential use.  Customers can just plug the QC-1 to power and Ethernet and then add their Ethereum cryptocurrency wallet address in a companion smartphone app.

Smarting up the Grid

CleanSpark, Inc. (CLSK:  OTC/QB) offers microgrid control platforms to help customers manage renewable energy generation.  The company’s mPulse software and controls package provides real-time control and reporting to manage electric grids. 

In early 2018, CleanSpark won a contract to design a turn-key ‘off grid’ solution for a cryptocurrency mining operator.  The company will use is mPulse controller to operate a containerized solution for the cryptocurrency. 

Investors might be happy to learn that it would be possible to get a stake in CleanSpark by conventional means, using dollars in a regular brokerage account.  The public registered shares trade at a lofty multiple of 175 times sales.  So far CleanSpark has generated just over a half million in revenue.  If the company’s crytocurrency network solution is effective in reducing energy requirements, it could bode well for strong revenue growth in the future.

Neither the author of the Small Cap Strategist web log, Crystal Equity Research nor its affiliates have a beneficial interest in the companies mentioned herein.