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The future is not set.
Okay, we need a hacker password is the word of the day.
Yeah.
Six o'clock.
We're going to hack a password.
But before we hack a password, you know what we're going to do?
We're going to talk about the future of Bitcoin mining.
Because the future is now.
And that's what's really important is that we talk about things that are important to Bitcoin miners.
And things that are interesting to all of us.
Because we're the only ones here.
You know, being the only ones here, we can talk about whatever we want.
And you can have dinner while you're doing it.
Exactly.
There you go.
There's these great vending machines out there.
You just put your card in there, you grab whatever you want.
We don't have those in Oregon.
They don't.
Well, welcome to the city, young man.
Welcome to the city.
Anyways, we are going to be talking about the future of Bitcoin mining.
You know, what are some of the new innovations coming out?
What are some of the things that we can look forward to as this industry starts to progress?
I'm really excited about it.
We know we've talked about it a couple of times.
I'm into heat reuse.
I won't bore you with all of the details.
I know Dan's working on some really cool stuff that he's going to be doing a presentation on tomorrow.
We'll talk a little bit about it.
But John, I think the best way to start this, unless you want to start in a different direction, but I think the best way to start is what does the future of Bitcoin mining look like right now?
And what are some of the things that could change along the way?
I think the future of Bitcoin mining right now is everything's going to be rack-mounted.
It's going to be hydro.
We're going to get to one petahash, right?
That's coming up.
There are 860 terahash.
So that new design, I like the way that they made the machine.
Because they didn't make the machine faster, they made the electricity smarter, basically.
Is that a good assessment of it?
Yeah, essentially.
So you've got the same chips, the same capabilities, and using the hydro infrastructure lets you increase your density substantially.
The other factor with the rack-mount hydro styles is it makes it a lot easier to phase into existing data center infrastructure, and a form factor that the tech world is familiar with.
You're no longer looking at the sheet box styles or the four fans on all different areas trying to scream through.
When you just plug in a unit into your rack and you run a cooling loop that goes to your building's water system or anything that you're using to circulate that heat out, it's a substantial improvement, and we're going to start seeing more and more of that in the industry.
The size factor is a big thing, too, because it used to be one shipping container was a megawatt.
Now it's kind of four big refrigerators is a megawatt.
And the amount that they can pack into that small space is pretty amazing.
That's the area that I'm looking at.
I'm looking at the Bitcoin miners and other miners that are in that space because I think that there's a lot of opportunity for, like Tim Martinez, who was here earlier, he's putting them in the basement of his small building they have a half a megawatt to work with,
and it gives them an opportunity to get the most out of a small space.
Yeah, we're definitely seeing the energy density of these machines, this hardware, get more and more compact.
I mean, we've seen Mara coming out with their three-phase immersion units.
I don't even know if it's technically immersion.
It's kind of like a vapor degreaser all combined in one box, and you can get a megawatt in an 8x8x8 box.
And what's really cool about this, going back to the Hebrew side of things, is if you look at New York City and a lot of other district places, they have this central boiler at the basement of a lot of buildings, and they have the energy infrastructure,
but they don't have an efficient way to transmute or transport that energy.
And I think that that's where something like this vapor degreaser style of cooling system can come into place.
If you could stick a megawatt of heating in all of these buildings in downtown Chicago, we could go from a zeta hash to 1.5, almost 2 zeta hash in a very short amount of time.
Absolutely, and they're paying for that electricity to use and create the heat anyway.
So you're substantially improving efficiency and operations, and as electricity and as power infrastructure becomes more and more scarce, as we get more and more dependent on electricity and the demand in production isn't keeping up, miners have to get creative in finding that.
And if some of that means instead of burning a megawatt on your apartment building's boiler, you burn a megawatt on mining to get the same output of heat, that's just a win-win all around.
Absolutely.
You know, something I'm going to highlight in my presentation later is that there is a direct correlation to energy usage and the prosperity of a nation.
There are no energy-rich, poor countries, and vice versa.
So the more energy that we use, the more that we develop and benefit as a nation, as an industry, as a population.
And so what Bitcoin miners are doing is seeking out the cheapest cost of power, and they're doing this in a lot of really innovative ways.
And the more that they use that power, the more that they're able to bolster energy grids.
I think that's a great jumping-off point, because I think one of the big things in Bitcoin mining is, we talked a little bit earlier, the big guys are getting bigger.
If you're unfamiliar with Bitcoin mining, there's about 15 companies that rule the world.
They have all the Bitcoin mines, they have all the cheap energy.
And those companies are starting to buy Bitcoin, and they're just getting richer and richer and bigger and bigger.
And they're pushing out opportunities, because they're able to buy power and the machines at such a low price.
But what I think there's a great opportunity for all of us, is there's kind of this artisanal Bitcoin mining, where we can get in there for half a megawatt, or even a few hundred kilowatts, and make these small Bitcoin mines by using innovation.
Not only the heat reuse, which is a different use, but there's oil and gas opportunities that I talked about a little bit earlier.
And you're familiar with them, you have a small rig in Pennsylvania.
Yeah, so as I mentioned earlier, in addition to ASICplug, I'm also Chief Mining Officer of Kratos Digital Mining.
One of our sites is actually at a stranded natural gas facility.
So this facility has been in operation for many years, running conversion to LNG.
It's out in the hills, there's no power infrastructure, there's no pipeline.
So the only way that they can monetize their gas is pump it out of the ground, run it through compressors and chillers, put it into a truck, drive the truck away.
Well, when diesel prices started going up, and LNG prices started going down, they got to a point where that just doesn't make sense.
It's too expensive, too costly to run.
So what we were able to do is come in, run their generators, feed the power to our Bitcoin mining containers, and we've got a couple hundred miners up there, running on a Starlink, out in the middle of nowhere.
Last gen, cheap equipment that we got going, and it's running very profitably because we can consume the gas right out of the ground, at the source.
We don't have to go through middlemen, we don't have to go through substations and power feed lines or anything.
We're all right on site, and then when it comes time for them to meet their LNG quota, they flip the breaker for three or four days, run LNG, put it in their trucks, take them away, flip the breaker back on, our mine kicks back up.
So it's a phenomenal way to utilize stranded resources to monetize and pay back for the site operation expense.
Yeah, and you mentioned this in your previous presentation, John.
The amount of flare gas in the world is substantial, and being able to monetize that flare gas allows you to, you know, obviously create different revenue streams, but clean up our environment.
And this is something that I'm very passionate about with the heat reuse side of things, but also in the waste mitigation.
You're seeing a lot of Bitcoin mining sites pop up in landfills, pop up in other areas where waste, like methane or garbage, garbage is creating methane, and they're able to use that methane to create a process that burns and creates energy, and then they're mining Bitcoin,
which is monetizing that process.
But not only are you seeing this in landfills, you're seeing it in small distilleries, where, you know, they take bourbon, and they have this waste after the bourbon process is created, and they take that waste, turn it into methane, and again, create Bitcoin with it.
But something that Dan is doing that really excites me is this idea of taking tires, breaking those tires down, pulling the gases from the tires, and turning it into Bitcoin.
And when you push this into the future, you look at, like, what happens in our world when we're able to start cleaning up our environment and making the place a better world to live in, but also monetizing that process.
It looks pretty cool to me.
Absolutely.
You know, we've got a whole segment tomorrow on the waste-to-energy side, where I'm going to dig in deep, but for those out here interested right now, yeah, we have some IP around the molecular deconstruction of tire waste and plastic waste to break it down to the base elements,
such as propane, diesel, and industrial rubber.
And when we can run the propane and the diesel through our generators that have dual layers of carbon scrubbers, we can reduce the emissions of the generators by 99%, we can clean up the environment by consuming these tires, turning them to electricity,
creating Bitcoin, or even if you're not in a Bitcoin mining environment need, you can create power for your village or your industrial center or anywhere in the world where you can utilize this tech and clean up the garbage.
You can create power.
And as you mentioned, power is increased GDP.
Power is economic growth.
Power is going to be what turns these third-world countries into second-world countries.
I've been saying for a while, you know, if you project into the future 50, 75 years, the amount of energy resources that Africa has is substantial.
I mean, way more than North America.
And they have a lot of really smart people.
But the problem is that they don't have access to this energy infrastructure.
They have a lot of waste because we send our waste over to them.
But what happens 50 years from now when they're able to turn the lights on because they have all these Bitcoin mining-powered villages, and people are able to use their combined brainpower to compete with first-world countries like the US, Canada, Europe,
I really do believe that we're going to see great innovations come out of Africa and other third-world countries as they kind of start skipping over some of the trajectories that we've gone through.
And I think that they're going to start competing with us on a level that we can't even imagine.
We can't understand it.
And there's an interesting story about they put computers and they put all these interfaces and these different devices into areas where they have no education, no knowledge of how to use them, no prior training or anything.
And they let them figure it out.
And over the course of five to seven years, there are people who are able to have no education and take a computer, become fully educated and learn how to program and make innovative ideas.
The reason I think that is so powerful is that if you take somebody who has no knowledge of a computer and no prior education, no pollution of how things are supposed to go or how things are supposed to work, and you give them a blank slate, they can create anything.
A lot of the restrictions on our creativity is what we are told that we can't do ever.
That's the impossible, right?
But they don't view anything as impossible.
So I love the innovation.
If we can get that electricity, if we can get the power of the internet, the power of computers, the power of electricity, just having power, right?
That would really, it can really change the world in ways that we can't even imagine.
Well, I mean, look, we started with the phone lines, the phone networks, you know what I mean?
And then we moved to Wi-Fi networks, and now we're all connected through computers.
They're completely skipping that phone line process, going to Wi-Fi towers, and now everybody in third world countries has cell phones.
That's going to happen with Bitcoin and energy infrastructure as well.
They're going to skip over some of the roadblocks that we went through, some of the growing pains that we went through, and they're just going to skip it entirely, and they will be better off because of it.
Absolutely.
One of the things that I'm excited about in kind of discussing the waste energy, the tire stuff, is it enables the creation of another level of gig economy out there.
So in some of these third world countries, having the ability where someone can go around, collect garbage off the streets, take it to a facility to be processed and weighed, and they get a little receipt printout with a QR code, scan it, and they get their SATs.
They beep-boop, they get their Satoshis for the day, and realize, I'm in a struggling country, I don't have a quote-unquote job, but I just spent six hours cleaning up my community, and I made enough to support my family for a couple of days, get some groceries,
cook a meal, and that kind of innovation I think is coming, and that is going to be a game-changer into a lot of these third world nations.
Yeah, definitely.
I want to shift the conversation just a little bit, because I'm getting ready to have a conversation on my podcast, the Build a Mine podcast.
That's for anybody who's in the audience listening.
But I'm going to be having a conversation with this guy, Nick.
He's getting ready, he's learning and educating himself about the infrastructure that's required to mine in space.
You know, we talk a lot about energy producers, and what's going to happen when your energy producer becomes a Bitcoin miner.
But what are some of your thoughts on where the mining industry is headed when we need more and more energy infrastructure to provide the compute necessary for these high-powered data centers?
I mean, you take the space into account.
I mean, you've got so much solar power up there, nobody's doing it.
I mean, all it takes is just one person to figure out and crack that egg.
What are you seeing?
What are some of your thoughts moving into that space?
So, I am all for energy innovation and projects.
I'm struggling to... I'm excited to watch that episode, because I'm struggling to see how it's going to be economical to get the equipment up into space with how much it costs to actually launch equipment.
But if he's got ideas and stuff, I'm stoked to hear them.
One of the things that I've been excited about is a number of years ago, I saw about a company that was creating generators that would produce power based on ocean waves.
And I just recently saw that there was an innovation, and I can't remember which country it was over in Europe, but they're essentially like giant floating buoys a couple hundred yards out from the shore, and they're anchored at the bottom with electrical lines that send the current to the centralized charge controller,
essentially, and then feed back to the mainland.
And as the ocean waves comes up, it moves the buoy up and down, and it turns a turbine, essentially, on the inside to create power.
Now, something like that, in an array, where you're self-consuming the energy versus putting it through a microgrid and then feeding it back, you could have that set up where you don't have to do anything other than anchor it down.
As it goes through, you can consume the power into miners in this buoy and even set up an array of them where you've got your centralized data center buoy that has your Starlink on it and your Wi-Fi mesh network, Unifi systems or something, and a pass network to each individual unit,
run a rack of miners inside there, and then as they move up and down, they just perpetually run the miners, feed stock their little battery arrays in there to keep them going, and that's infinite power forever.
If your ocean waves aren't coming, you're having problems.
Yeah, you've got bigger problems.
That's a bigger issue than mining.
Yeah, you know, we hear a lot of FUD around energy use, and, you know, oh, Bitcoin mining is going to use up the world's energy by 2025 or whatever it is, and the biggest misconception there is that the world generates a lot of energy.
We have so many different ways to harness power, and that power is being created anyways.
You look at a waterfall, like, you can hear it.
You can hear the sound that that water makes as it's falling, you know, 300, 200, 100 feet.
There's power to be generated there.
And it's just that we haven't spent enough time to innovate and create those methods to harness that power, and once we start doing that and we start relying less and less on fossil fuels, I really think that we start to see a lot of prosperity in humans and in what we can create and what we can generate with Bitcoin kind of added as a layer on top of it.
Absolutely.
Most people have that negative connotation that they've gotten from politicians of Bitcoin mining is about greed and wasting power.
But the reality is Bitcoin mining is the number one driving factor for renewable and sustainable energy sources on Earth.
The drive to get Bitcoin to decentralize the financial markets and to operate the blockchain has been the number one driving factor in alternative energy sources.
It's not about people's feelings.
It's not about, you know, trying to meet a political party line.
It's about trying to find an economical way to continue progress in the world.
Yeah, I agree.
And, you know, you talk about decentralization.
When you talk about energy and decentralization, I think the ultimate dream is to be decentralized or be off the grid.
You know, like if you could not pay an electric bill and you could power your car and you could power your Bitcoin mine...
Careful, John, you're going into a weird space.
No, I'm not.
I'm not talking about Tesla's.
I'm just saying you can have a Rivian or whatever.
But, you know, if you could do all of that and you could have a Bitcoin mine that made money and you could have it through a power source like waves or a river or something like that, I believe that the future, the innovation will come from those, I don't know,
whether preppers or libertarians, you know, those people who are like, hey, we got to get off the grid and we got to hide out and make our own electricity.
One of those guys is going to come up with something.
They're going to be tinkering.
They're going to figure out a way to tap into a geothermal or, you know, turn waste or waves or something like that into electricity.
I think going back to what we were talking about in Africa, there's so many resources that we don't know how they work.
There's these mines of different rare earth metals, not raw earth, but they're rare earth elements that can be turned into energy that can be used in different ways that I don't think we fully tapped into yet.
And like I said earlier, with that blank slate, I think that there's a lot of opportunity in those third world countries where they don't know any better.
And they're like, hey, let's burn it and see what happens.
Yeah.
And, you know, the biggest issue in the past is that there hasn't been a way to monetize that process.
You know, the fact, the simple fact that you can take a Bitcoin miner, one or a hundred of them and place them directly where that power source is and start to monetize that process changes the entire game.
I mean, nobody is going to invest the time and resources into developing ways to harness power if there's no one to sell that power to.
Now, all of a sudden, you have Bitcoin miners who will buy as much power as you can send to them.
So developing those processes around, you know, harnessing thermal energy from volcanoes or harnessing, you know, hydro energy from rivers and dams, it changes the entire process completely.
Well, it makes it economical.
If you go to a third world country and say, I'm going to put in a dam and I'm going to power up this village and give them electricity.
The whole world doesn't care because it's in a remote part of the world.
You don't know those people.
It doesn't make any sense.
But if you say, hey, we're going to put in a dam.
And what we're going to do is we're going to make a bunch of Bitcoin off of it.
And that Bitcoin is going to help perpetuate building the infrastructure.
We're still going to make a profit.
And we're going to start building electricity in your community.
It's a good, it makes good business sense.
And so corporations will come in and start doing that.
Or smaller independents, it'll give maybe aid workers or that type of charity workers who go into countries and help them out.
It'll say maybe they can go in and fund something like that rather than buying everybody new shorts or whatever they do.
I don't know what they do, but you get the idea.
Yeah, absolutely.
Those projects allow for the local immediate monetization and adds jobs and capitalizes on the labor pool there where otherwise they wouldn't be able to perform and support their families.
One of the things I do a lot is I try to travel a lot.
And in the Caribbean islands, like Jamaica, for example, almost all of their power has to be generated by bringing in tanker ships of diesel to burn in generators to create power to feed through the grid.
They've got a little bit of solar and some other stuff, but predominantly it's inbound liquid diesel on tanker ships to create the power for the country.
That's why they're paying 40 cents a kilowatt hour.
It was something like the tire project I was talking about.
The ability to consume the waste resources on the island, turn them into fuels to burn in their generators versus having to bring in the tanker ships of them, even if it reduces their inbound ships by 20%, that's going to be an enormous change to the pocketbooks of the citizens,
of the end users.
And that's what is going to be able to help them get to the next step where they can actually afford a laptop.
They can afford to do online schooling or get education and information beyond what they're getting passed down in their local communities and continue to progress innovation throughout the country.
I love the way the conversation is going.
So to wrap it up, let's talk about what would be your big wish in Bitcoin mining in the future.
And let's limit this to the next year.
What do you think can realistically happen in the mining space that would really push things forward?
Higher temperature chips.
I want to see hardware that can reach higher thermal temperatures.
I'm really into heat reuse.
And what I think is incredible is these ASIC miners, they're at the base of it, at the very lowest level.
They are resistive heaters.
But what happens when those resistive heaters can hit 100 degrees Celsius, 212 degrees Fahrenheit?
They can boil water.
What happens when you can boil fluid is you can create steam and you can spin a turbine and start to generate power in and of itself, which then feeds back into the system.
It becomes a perpetual cycle of feeding power back into the system to create more power to generate these Bitcoin miners.
And I think it's going to happen as more and more manufacturers realize that there is a huge market for heating infrastructure in the world.
I mean, 50% of energy usage in the world, global energy usage, it comes from heat, whether it's comfort heat or industrial heat.
And if we can get these chips, this hardware, to a higher temperature, we're going to see a lot of innovation come from that.
Absolutely.
And on the innovation front, there's so many everyday use items that could be integrated with something like some Bitcoin chips.
For example, your hot tub.
If you have a hot tub at the house, either 120 volt or 240 volt, you're using electricity to heat the water.
There's no reason that you can't have that set up.
Nowadays, everything is smart something.
So , you know, 2025 hot tubs come out with smart sensors.
So you can use the hot tub app to set your timer and all that.
Well, that connects to Wi-Fi, meaning you're networking on your Bitcoin's handle.
In a little setting in the app, you put in your Bitcoin wallet.
It runs your chips and uses that to heat your water.
And you're now paying yourself for the electricity to heat your hot tub.
That's just a no-brainer.
Same kind of thing with water heaters or defrosters.
There's a lot of cold climates where you can integrate everyday items that will make a huge improvement in people's lives.
And I'd like to see that.
I'm also very passionate about heat reuse.
And another factor that I want to see coming is scalable consumer-grade units that are so simple.
You can just hand them out at Walmart to anyone walking in and say, Hey, plug this in, follow these three steps instructions, and you are mining Bitcoin at home and helping to decentralize the network.
Yeah, there's a really great foundation called the 256 Foundation.
And they're working on a lot of innovations, open-source innovations, that allow for people like you and me to develop on their platform.
Instead of buying a computer or an ASIC from Bitmain where you don't have any ability to go to the back end and see how this product works and how you can fix the form factor to suit your needs, we're going to see a lot of development start to come out where you can build your own form factor and create products that you can start to sell in Walmart that are super easy for grandma to set up.
That's my wish for the year.
With Solus Satoshi becoming so popular with BitX and having it an open-source platform, I'd like to see more innovation in that space where people can think outside the box.
We're kind of like in space heaters and we're kind of in this little world.
There's a whole other world over here that we can't see yet, that we don't understand.
And that innovation and having that open source I think is going to give some opportunities where someone's going to say, one of these brilliant people here at CypherCon, they may not know anything about Bitcoin mining, but they may be able to see what's happening in that Solus Satoshi and go,
oh, I'm using this in this completely different application.
And this might be a solution over here.
I don't think the answer comes from within the Bitcoin world because I think we're so focused on what it is and how it's working.
I think we're going to plant the seed and then that creativity and that innovation will come from brilliant people like people here at CypherCon or other industries.
Absolutely.
I completely agree with you, John.
So that was a great conversation.
Thank you so much for joining us.
Huge crowd here today.
We just are having so much fun at CypherCon.
Yeah, it's a lot of fun.
It's almost like COVID times right now.
I'll tell you, you know, people should be more excited about Bitcoin.
I'm super excited about Bitcoin.
I'll talk about it all day long.
You're a Bitcoin nerd.
You can do this all day.
I am.
We got a bunch of computer nerds in here that should be using ASICs and be nerds over there as well.
They are.
We're selling, you know, you're doing great over here.
You're selling some fantastic products, the nanos.
We have computers.
Come try to hack them.
And with that, we're going to take a short break and then we're going to bring Trevor up here.
Everybody's a heat punk.
We're going to talk about heat punks, man.
Not just Cypher punks, heat punks.
You need a punk rock intro song.
Yeah, I probably do.
Do you have one?
And a fog machine.
We're working on it right now.
Do you want me to beatbox for you?
Yeah.