How a cloud computing company is helping people mine for bitcoin

Key Points
  • Mining for bitcoin is getting much costlier, and will only get more expensive as time goes on.
  • Genesis Mining is one of a handful of cloud companies trying to make the process easier for people.
Alexander Demianchuk | TASS | Getty Images

For Genesis Mining, the process of bitcoin mining could be described as a meeting of fire and ice.

Mining — the method by which new bitcoins are made by a computer solving an extremely complex math puzzle — requires big, energy-intensive computing power to operate. Thus the "fire."

When cryptocurrencies were less popular, a miner with a computer at home could solve the puzzle quickly. But now bitcoin mining requires ever more and faster computing. A few companies, including Genesis, are starting to provide the cloud services needed to supply that capacity.

"We provide everyone access to mining through our cloud-based infrastructure," said Marco Streng, the CEO and co-founder of Genesis.

Started in 2013, Genesis Mining has grown into the world's largest cloud-based blockchain and cryptocurrency mining company, used by bitcoin miners the world over.

The company's cloud-based hardware provides miners access to as much computing power as they're willing to pay for.

As the price of cryptocurrencies skyrockets, so does the demand for mining services, Streng said.

The launch of bitcoin futures institutionalizes the digital currency further, adding to the growing demand for mining and validating transactions, Steng said.

"Futures contracts are a big milestone for the cryptocurrency market because professionally managed money will begin greater sophistication to the marketplace," said Streng.

So where does the "ice" part come in? All that computing power needed for bitcoin mining requires both low-cost energy and cool temperatures to keep the computers running. Genesis found the right mix in Iceland — low temperatures and low electricity costs.

Genesis also partnered with investment company Fiore Group to create HIVE Blockchain Technologies — one of the first publicly traded blockchain infrastructure companies. It listed on the Toronto Stock Exchange earlier this year.

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