Bitcoin mining is a complex but integral part of the Bitcoin network. Put simply, miners use powerful computing chips, designed to solve complex cryptographical puzzles in the Bitcoin blockchain. Roughly every ten minutes, a miner ‘solves’ the puzzle, and is rewarded with Bitcoin.
MGT is partnered with Bitmain, the world’s largest supplier of these specialized machines, and use Bitmain S9 Antminers to solve these puzzles and earn Bitcoin.
The software on the Bitmain S9’s are working day and night to solve the complicated calculations, when they do, we receive a block award (currently 12.5 BTC) as well as transaction fees. The more S9 Antminers you have working together the faster you can solve each block.
Unlike traditional currencies, Bitcoin operates on the basis of a public ledger system. In order for Bitcoin transactions to be confirmed, avoiding the same Bitcoin being spent twice, Bitcoin miners are required. Bitcoin mining plays an intricate part in the Bitcoin Blockchain ecosystem. Without Bitcoin miners, the ability to keep the public ledger system correct would be impossible.
MGT Capital Investments’ first began mining Bitcoin in September 2016, in a Washington State facility still operating today. The units in this facility laid the groundwork for our self-contained mining containers. These enable increased mobility in our mining operations, should the need to relocate arise.
In 2017, MGT opened an additional mining facility in Northern Sweden to support our growth agenda with the promise of decreased cooling costs and cheap, abundant electricity. Unexpected challenges with the hosting vendor led to a wind down of Swedish operations.
At the end of Q3, 2018, in response to the underperformance of MGT’s Swedish facilities, management shifted its principal operations to North America. This transition was made to materially reduce MGT’s costs while establishing the conditions for stable, long-term growth.
In October 2018, management located and announced a new mining facility in Colorado, undertaking the process of relocating MGT’s Swedish miners to that new facility in Q4, 2018.
Watch the videos below for a closer look at MGT’s mining operations.
Every time MGT’s Bitcoin miners solve a block we receive our Bitcoin reward. We then sell our mined Bitcoins at the end of each mining week. At this time we are currently keeping 10% of our mined Bitcoins for long term investments.
On top of the profits we make from selling our mined Bitcoins we also make money on the transaction fees. When our Bitcoin mining computers are used to facilitate a transaction we are paid a transaction fee by those conducting the transaction.