January 15th, 2018 (Vancouver) – Canada has been home to a few gold rushes over the years. The Klondike, the Cariboo, and others lead lured prospectors, miners and people from all walks of life from countries near and far to stake their claims and future fortunes. Gold fever has infected many over the centuries but in today’s rapid change world, technology has lead to a modern day version. Bitcoin fever. And its Bitcoin fever that has lead to a rush in Bitcoin mining.
Bitcoin (“BTC”) was created in 2008, by Satoshi Nakamoto – the name used by the person or group that created it. It was based on Blockchain a new technology that used a distributed ledger for security and confirmation of transactions. When it was created, Bitcoin it was very much by intent that it was based on the concept of gold and gold mining. Bitcoin was to be digital gold in a rare limited supply to be mined by those willing to work for it.
So in many regards, it seams quite natural that since Vancouver is the global capital of exploration mining, and financing, that the resourceful entrepreneurs and creative financiers would find their way into Bitcoin mining. Canada has been a key contributor to Blockchain technologies and crypto currencies. Ethereum and Ripple – just to mention two. It now appears Canada may emerge as a global leader in Bitcoin mining as China clamps down.
Reuters reported on Friday that privately held Bitmain, the world’s biggest blockchain mining company, is now looking at moving operations to Canada. The article also does on to say that Hydro Quebec is in talks with around 30 large cryptocurrency miners about potential moves to the Province. Of course China points to the huge amounts of power it takes to mine bitcoin as the main concern when the real reason may be more connect to capital account control. Bitcoin, and other crypto currencies have been used to transfer more money out of China then is legally allowed. Regardless, China has been clamping down on all things cryptocurrency – first the ICO, then the traders (who all moved to South Korea and Japan) and now the massive Chinese Bitcoin miners are under government pressure.
Canada knows mining. There are a number of smaller miners in Canada. In June 2017, Frank Giustra – a hugely successful Canadian financer, promoter, miner, movie maker, philanthropist, and close friend to Bill Clinton – jumped into the the Bitcoin mining arena with HIVE Blockchain Technologies. Its this kind of celebrity and financial clout that was needed to make the public markets take note of what was happening in the crypto currency sector. Mr. Giustra set out and nominated Frank Holmes as the Chairman of HIVE. Mr. Holmes is the CEO of US Global Investors which specializes in natural resources. He is gold pro and has studied and promoted the yellow metal for years. That’s not a coincidence. Why not make a gold expert the chairman of a digital gold mining company. The only difference is there is no geological or mining risk. He is there to speak to the virtues of gold, and digital gold. HIVE currently has a market cap of ~$458 million (as of Jan 15, 2018).
Now smaller Bitcoin miners in Canada are looking to expand and new companies companies running around Vancouver, and elsewhere in Canada looking to get financing for their gold mine – or Bitcoin mine. And in the coming days and months you will see more new Bitcoin Mining companies listing on the CSE, and TSX Venture Exchange.
So it would appear that Vancouver, and Canada will become well known for a mining of digital sorts and appear to hold on to their title of Mining Capital of the World while perhaps adding the title of Bitcoin Mining Capital of the World.
See also: Reuters: Chinese bitcoin miners eye sites in energy-rich Canada
Note: January 13th, marked a milestone in Bitcoin history as it passed the 80% mark for Bitcoins being mined. That means only 20% or 4.2million of the 21 million Bitcoins available remain for the miners to chase after. In addition, the protocol also requires that the reward of 12.5 BTC mining reward is halved every 210,000 blocks or approximately every four years. The next halving will be in June 2020 bringing the mining reward down to 6.25 BTC. What will Bitcoin miners do then? And what becomes of all those Bitcoin mining rigs? What would traditional miner do if it was to be confirmed there was no more gold to be mined?
(PS. Its important to also note that Canada is home to some of the most promising and advanced blockchain and cryptocurrency companies, namely Ethereum (Waterloo, Ontario) and Ripple (Vancouver, BC.). The core value of the Blockchain’s distributed ledger is much more then just Bitcoin, and Bitcoin mining.)