1/ Last month I quit my “safe” technology consulting job to join @BlockwareTeam.
One reason I did this was because I believe the 2020s are setting up to be a profitable decade for #Bitcoin mining.
Let me explain why.
One reason I did this was because I believe the 2020s are setting up to be a profitable decade for #Bitcoin mining.
Let me explain why.
2/ Two simple ideas.
1. Price will continue to exponentially grow
2. Hash rate growth will continue to slow
1. Price will continue to exponentially grow
2. Hash rate growth will continue to slow
3/ The price of Bitcoin will continue increasing exponentially due to future mass adoption and increasing scarcity.
Price growth is accelerating due to mining firms becoming large enough to capitalize on cheap public market financing.
Price growth is accelerating due to mining firms becoming large enough to capitalize on cheap public market financing.
4/ As more miners access public equity and debt markets, they can fund their operating expenses and hold all of the coins they mine.
Glassnode data shows this is already occurring.
As price goes up, this becomes increasingly important (≈ $18B of $BTC mined per year).
Glassnode data shows this is already occurring.
As price goes up, this becomes increasingly important (≈ $18B of $BTC mined per year).
5/ In addition to public miners, you have companies like $MSTR adopting #Bitcoin as their treasury reserve asset.
They are synthetic bitcoin miners. They have the ability to borrow money at very cheap interest rates to purchase bitcoin, removing more coins from the market.
They are synthetic bitcoin miners. They have the ability to borrow money at very cheap interest rates to purchase bitcoin, removing more coins from the market.
6/ While price is growing, hash rate growth is actually slowing. This is happening for two key reasons.
1. ASIC Commoditization
2. Lack of Scalable Cheap Energy
1. ASIC Commoditization
2. Lack of Scalable Cheap Energy
7/ New machines are no longer 100x more efficient within a couple years. ASICs have become increasingly more efficient on a J/TH basis, but that marginal growth is slowing.
This means new ASICs today have the potential to last for 7+ years.
This means new ASICs today have the potential to last for 7+ years.
8/ If the price of bitcoin continues to exponentially grow and ASICs continue to commoditize, then it will become clear over the next 8 years that a major bottleneck to hash rate growth is simply accessible scalable cheap energy.
9/ The issue with energy production being a bottleneck is that companies cannot spin up energy production facilities (like a large nuclear power unit) overnight.
These facilities take a minimum of multiple years to plan and fully build.
These facilities take a minimum of multiple years to plan and fully build.
10/ This lack of energy and minimal marginal increases in ASIC efficiency are setting the environment for miners to perform well now and in the foreseeable future.
11/ The point of this thread was to illustrate why I think that #Bitcoin mining is a fantastic industry to have exposure to during this phase of adoption.
After 2030, there will only be 500,000 coins left to mine for 110 years. Let’s get 'em now.
After 2030, there will only be 500,000 coins left to mine for 110 years. Let’s get 'em now.
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