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 Washington State. 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 and early 2019, management located and announced a new mining facilities in Colorado and Ohio, undertaking the process of relocating MGT’s Swedish miners to those new facilities.
In July of 2019 MGT determined to consolidate its activities going forward in Company-owned and managed facilities in LaFayette, GA. Located adjacent to a utility substation, the several acre property has access to over 20 megawatts (MW) of low-cost power. MGT has also ordered transformers with a total load capacity of 12.5 MW to accommodate the first phase of this project, and has begun the construction and physical site development.