The latest reports revealed that the operator of the firm that will soon become the biggest Bitcoin mining facility globally signed a mega-deal with GMO internet provider and Japanese financial services giant SBI. According to a BNN Bloomberg report of January 7, the tow Japanese mega-firms have agreed to process crypto transactions at a new mining facility.
The new facility is still described as of unprecedented scale, and it is currently being developed in Rockdale, Texas. Whinstone Inc., which is a subsidiary of the Frankfurt-based Northern Bitcoin AG, will operate this facility.
Whinstone has been operational since 2014 and has several mining sites across Sweden, the Netherlands, and the United States. In November 2019, it merged with Northern Bitcoin as the latter prepared to build what will become the biggest data center in the whole of North America. It will also become the biggest Bitcoin mining facility worldwide, occupying an area of more than 40 hectares.
GMO and SBI are yet to comment on this new deal.
Texas Is Turning Into A Global Mining Hub
Reliable sources indicated that Northern Bitcoin AG’s new site is expected to launch operations with a starting capacity of 300 megawatts. That amount is expected to increase to 1 gigawatt by the end of 2020.
This new capacity will outstrip by around three times the size of the world’s biggest crypto mining site currently. China’s Bitmain Technologies Ltd operates the site. It is located on the previous Alcoa aluminum smelter, also found in Rockdale.
Alcoa closed in 2008. Before its closure, it was the epicentre of the town’s once-productive aluminum industry in the 1950s. That was a significant driver of economic and population growth partnering with the nearby Sandow Power Plant to enhance developments in the region. Sandow shuttered in early 2018.
According to a senior Bloomberg Intelligence commodity strategist, Mike McGlone, there is a wave of large crypto miners flocking to Texas. They are heading that way since Texas has an abundance of cheap and renewable energy sources, especially wind. In 2019, wind accounted for at least 20% of Texas’ electricity generation. In that context, it is expected to overtake coal for the first time in 2020.
U.S. mining startup Layer1 that is backed by Digital Currency Group and Peter Thiel, is planning alongside Northern Bitcoin AG to build a proprietary power sub-station. This power sub-station will be set up on the plains of West Texas to generate solar and wind energy for all its Bitcoin mining operations.
Investors Are Still Positive
After enduring a volatile year in the crypto markets, McGlone commented on the reports about SBI and GMO’s involvement in the mining site:
“Bitcoin is attracting more institutional investors, and with the notion of limited supply and mass adoption — Bitcoin is winning this race.”
SBI has adopted a diverse strategy as regards to digital assets. It is known to have a history of close involvement with Ripple and XRP. The company even revealed that it is considering the probability of paying shareholder dividends in the token.
Furthermore, it continues to work as part of the joint venture by the name SBI Ripple Asia. That venture was initially formed to promote XRP’s usage in Asian financial markets back in 2016.