Bitcoin (BTC) mining is a particularly lucrative business. However, in order to remain competitive, mining farm operators must make significant investments. Indeed, the mining machines run continuously and wear out extremely fast. In addition, to maintain profitability, miners must constantly purchase the latest equipment. As a result, mining companies regularly deploy tens of millions of dollars to fulfill orders.
Genesis Digital Assets, the forerunner of bitcoin mining
Genesis Digital Assets (formerly Genesis Mining) is one of the oldest BTC mining companies. Founded in 2013, Genesis Digital has played a major role in the development of digital asset mining. Indeed, the Iceland-based company was the first to implement the cloud mining method.
Over the course of its history, the company has built some 20 mining sites and used more than 250,000 mining devices of all generations. Although its proprietary mining operations only began in 2017, Genesis Digital Assets has mined more than $1 billion in BTC. The name change accompanying the company’s expansion also allowed the company to raise $125 million to continue its development.
Genesis Digital Assets recently won a case in China’s Supreme People’s Court over half a million graphics cards confiscated in 2018. Genesis Digital Assets, then called Genesis Mining, was accused by its supplier of not paying its electricity bills since September 2018. As a result, Chuangshiji, the supplier, terminated the business relationship and took the opportunity to confiscate the mining equipment for use on its behalf.
In 2019, the company filed a lawsuit seeking the return of its 560,000 graphics cards and 60,500 AntMiner S9. In a decision on June 23, 2021, the Chinese Supreme Court finally ordered the return of 485,681 graphics cards, with the rest of the devices already sold by the power provider.
Genesis orders 20,000 ASICs and is considering buying 180,000 more
Faced with this deplorable situation, Genesis has only one solution: increase its mining capacities. So that’s what the company has done. Genesis Digital Assets has just purchased 20,000 ASICs from Canaan. In addition, Canaan has granted the company an option to purchase an additional 180,000 ASICs. However, the parties did not specify the models to be ordered or the amount of the transaction.
If exercised, this would be the largest ASIC order to date. The new agreement follows a $93 million order Genesis placed with Canaan in April.
“Our strategy has always been to grow faster than the rest of the market. This is accomplished by building and launching new data centers, expanding the capabilities of our existing facilities and installing best-in-class equipment. Our recent orders from Canaan’s Avalon Miners will help us increase our hash rate by at least 2X over the next few months.”Abdumalik Mirakhmedov, co-founder of Genesis Digital Assets
The end of the Chinese hegemony on bitcoin mining has launched a real arms race between miners. Indeed, the exodus of Chinese miners has created a vacuum that miners from the rest of the world are rushing to fill, deploying as much computing power as possible.