The big business buzzword of the moment has to be Bitcoin. However, in order for a Bitcoin to exist, it must first be mined. This is a fascinating and highly complex process: all mines together form the global infrastructure that is needed to ensure Bitcoin transactions are completed successfully and properly. And in order to mine a Bitcoin, you need a dedicated, highly experienced team who know exactly what they’re doing. And so…
The Third Bladetec Bitcoin Mining Company Ltd (TBBMC for short) was co-founded this year by John Kingdon and John Pitcher, and will be administrated and managed by BLADETEC, the business they founded in 2002. They have maintained their simple ethos throughout: in a world of increasingly complex business computing, their stated goal has always been to achieve the ‘power of less’. By harnessing disruptive technologies, they have built systems that are faster, cheaper and therefore more efficient for their clients (who include such high-profile names as the City of London Police, National Grid, NATO and the Ministry of Defence). In a nutshell, they deliver this beautifully and have been at the forefront of blade computing technology ever since. John Kingdon is a tech genius whose 30 years of experience have included the growth of a single operation business to a revenue of $70m in 6 years and John Pitcher, who will manage the promotion and sales side of TBBMC. With a Bachelor of Applied Science in Computing from the Queensland University of Technology he started his career in software development in the 1980’s including the successful creation of a number of new technology businesses. The third member of the mining triumvirate is Declan Kennedy. An accountant, he is known as Ireland’s first ‘green’ entrepreneur (and won the highly coveted Entrepreneur of the Year Award in 1997), having founded the Irish Forestry Fund. The concept of collective ownership behind such a fund – buying the land, growing the trees, cutting them down after a precise number of years and then disseminating the proceeds of these assets to the shareholders – is a perfect analogy for the goal of TTBMC.
‘Bitcoin is the first cryptocurrency’, explains John Kingdon. ‘It was introduced in 2009 by an unknown person(s) named Satoshi Nakamoto. It differs from fiat currencies in that it isn’t controlled by any government but rather by a monetary policy that is based on artificial scarcity, thus creating its value. Only 21 million Bitcoins will ever exist and these are released in batches of 12.5 every ten minutes to miners of Bitcoin. It is estimated that 78% of all Bitcoins have already been released through this process, leaving approximately 4.7m still unclaimed and the last one is expected to be metaphorically minted by the year 2140.
So how does a mine work? Just as gold miners produce the world’s supply of gold, so do Bitcoin miners produce Bitcoins. This is done by utilising complex mathematical formulae and hugely powerful computer processors, enabling them to build and add a new block to the Bitcoin Blockchain (a publicly visible, anonymous online ledger that records every single Bitcoin transaction), which results in the receipt of Bitcoins as a reward. These miners keep the chain consistent, complete and unalterable by repeatedly verifying and collecting newly broadcast transactions into a block. A useful example would be to compare it to a lottery: the more tickets you buy, the higher the chance of winning. In a Bitcoin mine, this equates to the faster the speed and power of the computers, the greater chance a miner has of ‘winning’ the coin.
The TBBMC will be the first Bitcoin mine in Europe to be funded by investment in a limited company governed and protected by UK law. The company’s strategy is actually quite straightforward: they will acquire approximately 1000 ASIC (Application Specific Integrated Circuits)-based Mining Computers all running at 43 Terra-Hashes per second (a speed so unfathomably fast, it’s nigh on impossible to quantify; suffice to say, it’s the fastest available globally today). This will create a significant global mine, placing them in the world’s top 25 and as a result of this dominant position, produce significant returns for shareholders.
As Managing Director of Biotricity, Declan is fully aware of the energy required to run such an efficacious mine. ‘These machines are incredibly efficient in terms of energy’, he explains, ‘although obviously they use a large amount of electricity. We are negotiating exceptionally favourable energy prices with our power network provider. TBBMC will be 100% shareholder owned and we are offering investors the chance to acquire shares at £1.00 each with a minimum investment of £5,000. We are entirely focused on maximising shareholder returns and so, understanding the relatively volatile nature of Bitcoins, we have allowed for four different growth scenarios with up to 45% capital growth per annum. Our exit is estimated to be within 2 – 3 years at which stage our shareholders’ returns will be based on the proceeds of the sale of the mined Bitcoins and the ASIC machines. We know that our mine will be highly competitive for the next few years and the revenue we generate for our shareholders will be in £Sterling. We are seeking funding of £10m to purchase the hardware, build and run this dedicated facility and to recruit new personnel. We are highly experienced, having done this twice before, so we know what we’re doing, and we’re very successful at it”.