Layer1, the Bitcoin mining operation backed by PayPal founder Peter Thiel, has begun operations at its site in West Texas. Following a successful fundraise last year, the company has flipped the switch on mining activities, which it hopes will help bring more decentralization to the Bitcoin mining industry and usher in a more environmentally conscious practice.
Layer1 “Repatriating US Bitcoin Mining”
Layer1 is the first vertically-integrated Bitcoin mining farm in the US that uses renewable energy, namely wind power, which massively reduces costs. Its multiple 2.5 megawatt liquid-cooled containers are also more energy efficient than most existing mining practices, while their use also increases the longevity of the equipment, again helping to keep costs low.
In a press release, Layer1 said that its goal remains that of “repatriating U.S. Bitcoin mining”, with the hope of scaling the Bitcoin mining farm up to 100 megawatts in the coming months, which would exceed 2% of the total Bitcoin hashrate, with the ultimate target of reaching 30% saturation by the end of 2021.
This lofty goal, should it be achieved, would take a chunk out of the Chinese Bitcoin mining industry that has long dominated the space and has brought criticism that Bitcoin is more centralized than many would like to think.
New Approach a “Game Changer”
Alexander Liegl, co-founder and CEO, Layer1 explained why the company was best placed to challenge the status quo:
Our factory in West Texas is a game changer in Bitcoin mining. The facility uses custom ASIC chips and patent-pending liquid cooling technology, that enables us to unlock warmer climates – where others cannot – and benefit from the world’s largest supply of low-cost, sustainable local energy.
Liegl added that the halving would act as a “death knell” to Chinese miners who are working from “a playbook stuck in 2017”. However, Layer1 could face competition from the Russian Mining Company (RMC), who at the same time as Layer1 were announcing completion of their $200 million fundraise, announced their own ambitions to corner 20% of the Bitcoin mining market through conversion of a former aluminum plant in the country.
Whoever wins out in the Bitcoin mining wars, one thing is for certain – with that much mining going on, it certainly won’t be a cold war.