Ben Strack

Though not the type of crypto hire we typically cover in these roundups, President-elect Donald Trump nominated Cantor Fitzgerald CEO Howard Lutnick to lead the Department of Commerce this week.



We highlighted Lutnick’s <a href="https://link.mail.beehiiv.com/ss/c/u001.VIz4fB9RgLaqgT0Ji6lSIMhLGx1BG6y6FX8v5LSXYwgUk16fXNbzd9DTUZWINQEf822GPTmvyxixSLBlUzCfKEiY7xc0k6NQw_Om4FA0ED4DeLOcBwhii-0F9NXtu_zQSpEgbeAkqPWj8FN7nb3EkSxZPYvduKlbYQ1oEIxnJPWkCNRQwlBaHZdQG-r-825rKPPIeL_nMIm7e9pJJmQgtBrC08tfpE_1H778ia1rOCUuFQdINNfOeOsD4UvOjPUS9HtR9c01KKfn9luJAfBVu213XdyebUOsBSN3pAUqVP4/4bl/IH224rKYS1q1ONJ1-gW0DA/h20/h001.77vd-pY95ElrlwXXb3i5dZ-R-fIDLipP7mXZqCpSjJA">remarks on bitcoin</a> in a September edition of the Forward Guidance newsletter. At the time, the CEO noted that traditional finance players — including banks and brokerages — would “go headfirst into bitcoin” when the regulatory environment improved.&nbsp;



Trump’s election win has seemed to set the stage for that, given the <a href="https://link.mail.beehiiv.com/ss/c/u001.VIz4fB9RgLaqgT0Ji6lSIMhLGx1BG6y6FX8v5LSXYwigNEM9nXQOp7Y6rYnk4N-VViTtVUBtTUFuOw3Y0SGzqJaLC5YCGtHdUh7zP8F08Vctj5GIA_3ToEZLQ-kWSVRg5HyB_Zgs4WgDo4Bo71rdFSv0iWIROf_jyIKSs-zr1Igy57Aam05L-wIEFb5cRS_FsOx11mCqK8KyzrB3tagk7o7SJX8ylRAcFhLMnRsD5vIPwoT9jSF6Pxpggmn7j6fl_PYeWPZdAy6v7tsa_mD5mNTZoydJIuZ9GyoXQhFPprZFrQA6HgXfnAG1PprcQdez/4bl/IH224rKYS1q1ONJ1-gW0DA/h21/h001.FBU8i7legpmz1J4JxNUxzwposhly6rBZfSbAy03MBcc">crypto promises</a> he has made (namely, “firing” Securities and Exchange Chair Gary Gensler).



Read more: <a href="https://blockworks.co/news/trump-nominates-commerce-dept-leader">Trump nominates pro-crypto CEO to lead commerce department</a>



Lutnick <a href="https://x.com/howardlutnick/status/1831080474124681316?s=46&amp;utm_source=forward-guidance.beehiiv.com&amp;utm_medium=newsletter&amp;utm_campaign=options-open&amp;_bhlid=e85ffb801808c011874423cc190af9f43a1861ef">said</a> in a September X video that bitcoin adoption will proliferate once banks can more freely clear, custody and transact in bitcoin — a reality hindered by the SEC’s Staff Accounting Bulletin <a href="https://link.mail.beehiiv.com/ss/c/u001.VIz4fB9RgLaqgT0Ji6lSIMhLGx1BG6y6FX8v5LSXYwjkzkkNq3FGLJqh4wkyHMJY_s1SVlapX0RF6tXS-mB7PtUyAgVzHOHJvr74YCtLOTNQFQf_Vz_SJQU8j1vQZY-hyHjncXDc8a_L-KY5zLWmRtgHN4pnFtIDa8YK-pnPFIRPHyxSE_prxEa_TeMBs_2l_nz7-le2zouwKD4qmeg2h2LSkXt01JZKHJffWqdmSeJ5dQ7gZH2BOo8C8-zjEycOtfCdA4c-5Jj7yPg1lG_OUQ/4bl/IH224rKYS1q1ONJ1-gW0DA/h23/h001.0fIErinHJecrQsGq3Imi39lmmH8ZZwAKRakgiayAoPg">(SAB) 121</a>.



Lutnick’s firm has stablecoin issuer Tether as a client — a company that has denied being <a href="https://link.mail.beehiiv.com/ss/c/u001.VIz4fB9RgLaqgT0Ji6lSIMhLGx1BG6y6FX8v5LSXYwgZQzTpD9i20l7fRn4fMOxRNJ-OYOLpnRBKvC5u7r-5IMmkjkDsEmfGeWHM3_abYXfZAVDyVXFX_04IvI1yUKgRLHoNAFPYoiA67it2Gv6DnH81LyqIpwcyyoHyffm1gcXB3TVkSQnDaLXw785tbjBkIwbAgwkk89IKeJZzUfPMdMz_HpQZ-QW3WsRT_GOUi-QvPGwdOYOg4IBOlN5usMcFIGy6iWiEuXMcvAhe_gPazUF-80jrqhnP7WFJQGb200Y/4bl/IH224rKYS1q1ONJ1-gW0DA/h24/h001.EbF974gF-xuBcsYq229KAI_PCDC4k3YiQc37tFu5ArU">under federal investigation</a>.



Speaking of Trump appointments, reports surfaced this week of him potentially <a href="https://www.forbes.com/sites/digital-assets/2024/11/21/leak-reveals-trump-crypto-bombshell-as-bitcoin-suddenly-surges-toward-100000-price/">selecting</a> a crypto czar and forming a <a href="https://www.reuters.com/technology/crypto-industry-jockeys-seats-trumps-promised-council-2024-11-21/">crypto council</a> that could be housed under the White House&#8217;s National Economic Council.



Still, Blockchain Association CEO Kristin Smith said she is watching out for who could fill two other roles.



<figure class="wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter"><div class="wp-block-embed__wrapper">
<blockquote class="twitter-tweet" data-width="550" data-dnt="true">We’ll have lots of time to debate who would be best for positions like a “crypto czar.” It’s a great idea, but the ones before us are Treasury Secretary and SEC Chair–a crypto czar won’t be able to get much done unless the people in those posts are strong. Let’s stay focused.&mdash; Kristin Smith (@KMSmithDC) <a href="https://twitter.com/KMSmithDC/status/1859339558342607023?ref_src=twsrc%5Etfw">November 20, 2024</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
</div></figure>



<a href="https://blockworks.co/tag/gary-gensler">Gensler</a> said this week he would <a href="https://blockworks.co/news/gary-gensler-resigning">step down from his SEC chair post</a> on Jan. 20.&nbsp;



Read more: <a href="https://blockworks.co/news/sec-departures-regulation-changes">Changes at the SEC start well ahead of Inauguration Day</a>



As for a crypto firm adding an executive, bitcoin infrastructure technology Blockstream appointed hedge fund veteran Sean Bill as its chief investment officer.&nbsp;



Bill, who was most recently CIO of Prime Meridian Capital Management, is set to lead Blockstream’s newly created asset management division.



The firm’s bitcoin financial products in development include a bitcoin yield fund (aiming to function like a money market fund for BTC holders) and a USD yield fund (providing lending opportunities that generate income through bitcoin-backed loans).&nbsp;&nbsp;



In other soon-to-be hiring news, Wintermute Asia is set to double its headcount in the <a href="https://blockworks.co/tag/apac">Asia Pacific</a> region upon establishing a new headquarters in Singapore, the company said earlier this week.&nbsp;



The digital asset derivatives trading arm of Wintermute Group said Monday it is “actively hiring for top-of-the-funnel roles that are critical to scaling its operations.”



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APAC

Crypto Hiring: Industry waits for more Trump appointments

David Canellis

Despite slick marketing leading up to the release of HBO documentary Money Electric, we’re no closer to finding out the identity of Satoshi Nakamoto.



What filmmaker Cullen Hoback, whose most recent work chronicled QAnon and 8chan with “Q: Into The Storm,” has given us is more of a creative retelling of Bitcoin lore.&nbsp;



The early efforts of the Cypherpunks, the formation of Blockstream and its victory in the <a href="https://blog.bitmex.com/the-blocksize-war-chapter-1-first-strike/">Blocksize War</a>, into the corporatization/industrialization of bitcoin mining and El Salvador adopting it as legal tender.



All that’s squeezed into 90 minutes, including cutaways to incessant negging from <a href="https://blockworks.co/news/nouriel-roubini-crypto-bitcoin-atlast">Nouriel Roubini</a> and the mainstream media — solid comedic relief.



That side of the film makes for a great primer on the discourse. It even features a decent, albeit small, roster of legitimate insiders, including (among others): Adam Back, co-founder of Blockstream, veteran hacktivist Amir Taaki, a prominent early Bitcoiner now working on anonymous protocol DarkFi, as well as cryptography consultant and former Bitcoin core dev Peter Todd. 



Hoback later suggests Todd could be Nakamoto, hiding in plain sight all these years.



Read more: <a href="https://blockworks.co/news/craig-wright-is-not-satoshi-nakamoto">Craig Wright is not Bitcoin creator Satoshi Nakamoto, UK judge says</a>



The bulk of Electric Money’s baseline reality, however, is woven with clips of Hoback following Back around the streets of Malta, to see if he’s Satoshi.&nbsp;



If Back was the progenitor, then the surrealness of <a href="https://www.coindesk.com/markets/2017/04/18/miami-2014-the-last-days-of-bitcoins-wild-west/">Bitcoin Miami</a> and nation state adoption were expressions of his genealogy.&nbsp;



It would also technically make Back a trillionaire, if bitcoin were to hit $1 million per coin, a factoid the film repeats over and over. That’s based on prior analysis that found Nakamoto had mined over 1 million BTC, although there is some <a href="https://blog.bitmex.com/satoshis-1-million-bitcoin/">dispute</a> about the real number.



Other scenes shadow former Blockstream marketing chief Samson Mow — who advised El Salvador president Nayib Bukele on his <a href="https://blockworks.co/news/el-salvador-timed-bitcoin-bottom-empire-newsletter">bitcoin adoption plan</a> — on a world trip as a self-styled Bitcoin ambassador. The film also tags along with Todd on urban exploration trips in Latvia, before he’s presented as a real candidate.



Read more from our opinion section: <a href="https://blockworks.co/news/philosophers-bitcoin-resistance-money">Why we need philosophers to explain bitcoin: A review of ‘Resistance Money’</a>



Back, who has repeatedly denied that he created <a href="https://blockworks.co/tag/bitcoin">Bitcoin</a>, is the only person cited by name in the body of the white paper for his work on Hashcash. It was an early proof-of-work system built in 1997 for curbing denial-of-service attacks and email, which <a href="https://blockworks.co/tag/satoshi-nakamoto">Nakamoto</a> tweaked for bitcoin mining.



Hoback looked for holes in Back’s story, the biggest of which was a letdown: Back was actually interested in Bitcoin years earlier than he previously claimed, and he’d even edited a Wikipedia entry to include potential identities for Nakamoto that weren’t him, including Nick Szabo, Wei Dei and the late Hal Finney. Not exactly proof.



Read more: <a href="https://blockworks.co/news/hal-finney-bitcoin-satoshi-nakamoto-zk-proofs">25-year old video shows Bitcoin pioneer Hal Finney talking zero-knowledge proofs</a>



It’s only at the 80th minute that Hoback lays his cards on the table: a bluff based on a loose interpretation of BitcoinTalk forum posts.



Todd was supposedly Nakamoto at the age of 15 because he’d:



<ul class="wp-block-list">
<li>Spoken online about building a digital currency based on Hashcash before 2009.</li>



<li>Never officially held a position at Blockstream despite working closely on Bitcoin Core, for decentralization purposes.</li>



<li>Minorly corrected Nakamoto about how a fee market would work in a BitcoinTalk thread, by “finishing his sentence” with a followup post over an hour later.</li>



<li>Perhaps created a sockpuppet, roleplaying as a US intelligence agent who would later publicly assign Todd the task of coding that fee market.</li>



<li>Stopped posting on BitcoinTalk around the same time as Nakamoto.</li>



<li>Cryptically once suggested in an IRC channel that he had physically destroyed the keys to his bitcoin.</li>
</ul>



<figure class="wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter"><div class="wp-block-embed__wrapper">
<blockquote class="twitter-tweet" data-width="550" data-dnt="true">“The level of reaching here rivals QAnon stuff (which is pretty ironic if you know what Cullen&#39;s previous documentary was about)” Exactly. The truth is pretty simple: there&#39;s hundreds, even thousands of people who could have created Bitcoin. We&#39;re not going to find Satoshi. <a href="https://t.co/TZMtqJhxgU">https://t.co/TZMtqJhxgU</a>&mdash; Peter Todd (@peterktodd) <a href="https://twitter.com/peterktodd/status/1843957196830441766?ref_src=twsrc%5Etfw">October 9, 2024</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
</div></figure>



It makes for a fun theory. For a final showdown, Hoback presents it to Todd and Back in an abandoned railway, a have-fun-staying-poor man’s Point Break. They both — rightfully — laugh it off, which has continued on X following the film’s release.



Whether we should or shouldn’t know who Nakamoto is or was is a tired conversation at this point.&nbsp;



Still, it’s obvious that for many normal folk, the question indeed presents a Rubicon that they can’t cross. That itself would hinder adoption, I guess, but as far as shedding light on the way through that mess goes, Money Electric ain’t it.



A version of this article first appeared in the daily Empire newsletter. Subscribe <a href="https://blockworks.co/newsletter/empire">here</a> so you don’t miss tomorrow’s edition.



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Bitcoin

We are all Satoshi Nakamoto — except Peter Todd

Shalini Nagarajan

Bitcoin infrastructure company Blockstream has made its Greenlight Lightning-as-a-Service (LaaS) solution available for global commercial use, starting Thursday.



LaaS refers to a model where a provider like Blockstream offers a managed <a href="https://blockworks.co/tag/lightning-network">Lightning Network</a> infrastructure to developers and businesses.&nbsp;



Greenlight was first <a href="https://blog.blockstream.com/greenlight-by-blockstream-scalable-non-custodial-lightning-infrastructure-now-open-to-developers/">introduced</a> to developers in June as a concept where &#8220;your users hold their keys, while we take care of everything else.”



The service allows developers to integrate Lightning payments into their applications using Blockstream&#8217;s Application Programming Interface (API), eliminating the need to manage their own Lightning nodes, according to a <a href="https://blog.blockstream.com/greenlight-is-now-open-for-business/">blog</a>.



This removes the need for in-depth Lightning protocol knowledge or the complexities of setting up a node, Blockstream said.



The Lightning Network itself acts as a layer-2 scalability solution atop the Bitcoin blockchain, enabling rapid and low-cost BTC transactions for users. Notable exchanges have already implemented Lightning payments, including <a href="https://blockworks.co/news/bitcoin-lightning-network-binance">Binance</a>, <a href="https://blockworks.co/news/coinbase-bitcoin-lightning-network-adoption-brian-armstrong">Coinbase</a> and <a href="https://blockworks.co/news/kraken-supports-bitcoins-lightning-network-after-delayed-launch">Kraken</a>.



<figure class="wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter"><div class="wp-block-embed__wrapper">
<blockquote class="twitter-tweet" data-width="550" data-dnt="true">After several months of gathering feedback and additional testing, Greenlight is now officially available for commercial-grade use worldwide. Read more about how you can integrate scalable, non-custodial Lightning infrastructure into your business 👇<a href="https://t.co/i5jHAmLp2q">https://t.co/i5jHAmLp2q</a>&mdash; Blockstream (@Blockstream) <a href="https://twitter.com/Blockstream/status/1712387719576551834?ref_src=twsrc%5Etfw">October 12, 2023</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
</div></figure>



Alternatively, developers had to choose between custodial and non-custodial solutions, each with trade-offs in convenience, security and technical expertise.



Blockstream said Greenlight aims to provide a middle ground by removing the barriers associated with both options without compromising on security, performance or functionality.



“By offloading labor-intensive node operations to Blockstream and integrating Greenlight with just a few API calls, companies can save on costs and free up valuable time to focus on meeting the needs of their users,” the company said in a statement.



Going the non-custodial route means developers can avoid the burden of securing user funds and dealing with regulatory costs and compliance requirements, it added.



To promote adoption of non-custodial Lightning solutions, Blockstream said it provides a free Greenlight plan tailored for enthusiasts and small businesses.&nbsp;



This plan allows developers to create up to 1,000 on-demand nodes, with each node activating and staying operational as long as it&#8217;s in use by an end-user.



For larger enterprises requiring higher capacities, Blockstream offers customized pricing packages that include increased node limits and assurances of uptime and availability.



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Blockstream’s new service aims to make Lightning integration a breeze

Sebastian Sinclair

It’s been a slow start to the year for crypto businesses seeking fresh capital.



Industry-related firms globally netted $2.42 billion in venture capital over 374 deals throughout Q1, 2023, marking a notable decline in value for the fourth straight quarter.



The year’s first quarterly period witnessed a 20% decrease from the previous quarter in total deal value, from $3 billion to $2.4 billion, <a href="https://my.pitchbook.com/search-results/s284388313/deal_chart" target="_blank" rel="noreferrer noopener">data from Pitchbook</a> shows. That translated into roughly 5% less in deal numbers over the same period, from 394 to 374.



Investments have continued to fall following their peak 12 months ago, thanks largely to waning interest in digital assets and a number of scandals that continued to damage crypto’s image.



As it stands, this year’s second quarter is on track to clock a fifth consecutive decline in both deal count and value, standing at 129 and $867 million, respectively. It’s worth noting that there remain roughly 49 days left in Q2, or roughly seven weeks, to break that streak.



Despite the overall decline, there were a few positive developments at the beginning of the year, Pitchbook said in its &#8220;Emerging Tech: Crypto Report,&#8221; published Thursday.



Layer-2 scaling solutions, which aim to improve the scalability of crypto like bitcoin and ether, continued to attract significant investment.



Native zkEVM Ethereum layer-2, Scroll, which processes transactions off-chain, clinched a $50 million deal on March 6 with a post-money valuation of $1.8 billion.



Bitcoin scaling platform Blockstream also managed to raise $125 million in a late-stage deal on Jan. 24, valuing the company at $2.49 billion, data shows.



That’s still a far cry from 2021 and 2022’s biggest deals, including Fireblocks&#8217; $550 million later-stage VC in January of last year and Blockchain.com’s $490 million deal, three months later.



“We believe late-stage valuations are being skewed upwards, as we suspect that only outsized, up-rounds are being disclosed and down-rounds are being kept private,” Pitchbook said in its report.



“Additionally, Q1 2023’s sample size is small and represents only a single quarter of data. We expect rising seed and late-stage valuations to reverse throughout the year.”



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Blockchain.com

Venture Investment Expected To ‘Reverse’ After 20% Quarterly Drop

Bessie Liu

Crypto infrastructure companies scored significant funding this week.&nbsp;



Among them was Blockstream, which landed $125 million in a convertible note from London-based Kingsway Capital, with participation from bitcoin-focused Fulgur Ventures.&nbsp;The <a href="https://blockworks.co/news/fundraising-wrap-over-800m-in-investments-poured-into-crypto-this-week">overall infrastructure trend isn&#8217;t necessarily new</a>, but such efforts do appear to be escalating. 



The latest capital haul <a href="https://blockworks.co/news/bitcoin-infrastructure-firm-blockstream-reaches-unicorn-status-with-3-2b-valuation">follows the firm’s Series B in August 2021</a>, when the company procured $210 million from investors to expand mining facilities and acquire Spondoolies, a crypto mining gear startup.



Erik Svenson, Blockstream’s president and chief financial officer, said in a statement that the fundraise allows the company to “accelerate” its year-over-year revenue growth and “build infrastructure for the future Bitcoin economy.”



Added Svenson: “We remain focused on reducing risk for institutional bitcoin miners and enabling enterprise users to build high-value use cases on the most secure, robust, and scalable blockchain in the world — Bitcoin.” 



Another infrastructure company that corralled funding this week was QuickNode. The end-to-end development platform <a href="https://www.theblock.co/post/205028/quicknode-reaches-800-million-valuation-in-series-b-round" target="_blank" rel="noreferrer noopener">closed</a> a $60 million Series B led by 10T holdings. Other investors who participated in the round include Tiger Global, Seven Seven Six, Protocol Labs and QED.&nbsp;



The latest funding brings QuickNode’s total valuation to $800 million, and will be used to grow the company’s international presence.



“The long-term health and success of Web3 are dependent on scalability, accessibility, and interoperability,” ​​said Alexis Ohanian, founder of Seven Seven Six, which also invested in the company’s seed round.



”[QuickNode’s] foundational technology and platform is building not only to meet the current needs of top Web3-native companies and flagship global brands but also those of the future decentralized web,” he said.



In a smaller fundraising effort, Tholos, an MPC wallet platform — similar to Fireblocks — landed pre-seed funding of $1.5 million.



The round was led by four crypto-native venture capitalists, including North Island Ventures, Lattice, Dispersion Capital and Chainforest. A handful of angel investors also participated, Abraham Litwin-Logan, the founder of Tholos, told Blockworks.



Tholos’ team currently consists of the co-founders, a full stack engineer, a mobile engineer and the head of product and design, as well as two part-time senior back-end engineers. But additional hiring, enabled by the cash infusion, is already under way, according to the team.



“On the cryptography side of things — we’ve partnered with a multi-party computation cryptography team in Israel, which is made up of three cryptographers,” Litwin-Logan said, adding that the remaining cash would be used for product development and testing before it goes onto the market.



Other notable fundraises this week include:



<ul class="wp-block-list">
<li>Spatial Labs <a href="https://www.theblock.co/post/205813/spatial-labs-iddris-sandu-seed-funding" target="_blank" rel="noreferrer noopener">lands</a> $10 million from Blockchain Capital, with participation from Marcy Venture Partners, a firm co-founded by Jay-Z.&nbsp;</li>



<li>Gemba, a software developer for virtual reality training, secures $18 million from Parkway Venture Capital, bringing its valuation to $60 million.&nbsp;</li>



<li>London-based blockchain infrastructure company Calimero Network closes an $8.5 million seed round led by Khosla Ventures, Lyrik Ventures and NEAR Foundation.</li>
</ul>



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Blockstream

Funding Roundup: Crypto Infrastructure All the Rage

Casey Wagner

<div id="highlights-block_62506ac4827ba" class="highlights">
 <ul>
 <li>Tesla will provide solar and storage technology to the Texas-based mine</li>
 <li>Blockstream will release a public dashboard with data on bitcoin mined and power output</li>
 </ul>
 
</div>



Jack Dorsey’s digital payments company Block, <a href="https://cms.blockworks.co/jack-dorseys-square-to-change-its-name-to-block/" target="_blank" rel="noreferrer noopener">formerly Square</a>, and bitcoin infrastructure provider Blockstream have announced a development in the partnership they first announced in June 2021. After enlisting help from Tesla, they have broken ground on a solar- and battery-powered bitcoin mine.&nbsp;



The West Texas-based bitcoin mine will use solar and storage technology from Tesla, Blockstream <a href="https://blog.blockstream.com/blockstream-and-block-inc-s-solar-mining-facility-now-powered-by-tesla-solar-pv-and-megapack/" target="_blank" rel="noreferrer noopener">announced</a> Friday. The facility will be powered by Tesla’s 3.8 megawatt solar PV array and 12 megawatt-hour <a href="https://www.tesla.com/megapack" target="_blank" rel="noreferrer noopener">Megapack</a>.



West Texas, known for its high number of <a href="https://www.currentresults.com/Weather/Texas/annual-days-of-sunshine.php" target="_blank" rel="noreferrer noopener">annual sunny days</a> and sufficient wind speed, has become a hub for renewable energy in the US.&nbsp;



The mine is expected to be completed later this year, according to Blockstream, which will provide the mining infrastructure for the facility.&nbsp;



The combination of Tesla photovoltaics and Megapack battery equipment will drive the 30 petahashes per second of mining hardware at the facility with 100% solar energy, Blockstream wrote in a blog post Friday.



Additionally, Blockstream said it would provide regular reports on the economics of the project through a publicly-accessible dashboard. The dashboard will display real-time metrics of the facility’s performance, including power output and bitcoin mined. The team plans for the dashboard eventually to include solar, storage performance data points and uptime metrics, according to Blockstream.&nbsp;



The project, first <a href="https://cms.blockworks.co/blockstream-and-square-partner-on-solar-powered-bitcoin-mine/" target="_blank" rel="noreferrer noopener">introduced</a> at the Bitcoin 2021 conference in Miami in June, is a $12 million initiative. Block said in June that it would be investing $5 million toward the mining facility as part of its broader goal to reach carbon neutrality by 2030.“



The project will serve as an ongoing, transparent case study that will allow us to all learn together the specific unit economics of clean energy bitcoin mining,” Neil Jorgensen, global ESG lead at Block, said in the June 2021 <a href="https://www.prweb.com/releases/blockstream_and_square_inc_join_forces_to_build_solar_powered_bitcoin_mine_in_the_us/prweb17985526.htm" target="_blank" rel="noreferrer noopener">release</a>. “We can’t wait to start sharing our results with the community.”



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Bitcoin mining

Blockstream and Block Enlist Tesla, Break Ground on Bitcoin Mine

Sam Reynolds

<div id="highlights-block_614e25af424a7" class="highlights">
 <ul>
 <li>Blockstream sees itself as a bitcoin financial infrastructure company, and promises to do everything you’re excited about on Ethereum without using the ‘world’s computer’ or a layer-1</li>
 <li>Part of company’s recent $210 million round will be used to develop institutional-grade miners and their chips, which is no cheap task</li>
 </ul>
 
</div>



Blockworks recently sat down with Blockstream’s Chief Strategy Officer, Samson Mow at the company’s headquarters in Victoria, BC, to talk about the company’s plans for its recent $210 million round. Then, with less than a week to go before Canada’s federal election, Mow first had to talk about his frustrations with politicians. Canada — home to the world’s first bitcoin ETFs — is actually a pretty unfriendly place for crypto, said Mow.



Blockstream, with its fresh <a href="https://cms.blockworks.co/bitcoin-infrastructure-firm-blockstream-reaches-unicorn-status-with-3-2b-valuation/" target="_blank" rel="noreferrer noopener">round</a> of funding and newly minted unicorn status, should be the kind of company that politicians are head over heels for —&nbsp; it employs tech workers and pays them well. Plus Blockstream, as a Bitcoin infrastructure company that focuses on using hydro and nuclear power, could be considered to be producing green tech jobs.



<h3 class="wp-block-heading">A surplus of power, but nothing to sell</h3>



Blockstream’s Quebec-based mining operations exclusively use hydropower thanks to the province’s energy company, Hydro Quebec, which built out massive capacity in the middle of the twentieth century with sweetheart financing deals from the Canadian Feds. Power is cheap and plentiful in the province.&nbsp;



Despite having a power surplus, Hydro Quebec, the provincial-owned company is <a href="https://www.cbc.ca/news/canada/montreal/cryptominers-are-stuck-in-limbo-as-hydro-qu%C3%A9bec-suspends-requests-for-power-1.4644682" target="_blank" rel="noreferrer noopener">notoriously difficult</a> to deal with as it places moratoriums on the amount of power miners like Blockstream can buy.



In fact, Compass Mining, another bitcoin mining company, noted in a recent <a href="https://compassmining.io/education/content/images/attachments/Compass%20Mining%20North%20American%20Bitcoin%20Mining%20Index.pdf">industry r</a><a href="https://compassmining.io/education/content/images/attachments/Compass%20Mining%20North%20American%20Bitcoin%20Mining%20Index.pdf" target="_blank" rel="noreferrer noopener">e</a><a href="https://compassmining.io/education/content/images/attachments/Compass%20Mining%20North%20American%20Bitcoin%20Mining%20Index.pdf">port</a> that the high level of bureaucracy in Canada has hindered the growth and scalability of bitcoin mining.



“If they&#8217;re willfully ignorant, there&#8217;s not much you can do about it,” Mow said. “So if it&#8217;s a politician fighting Bitcoin energy usage — maybe they&#8217;re spearheading some wind project or something — it&#8217;s going to follow the money where it goes.&#8221;



“There’s always some ulterior motive. Elon Musk was <a href="https://cms.blockworks.co/crypto-industry-skeptical-on-musks-bitcoin-u-turn/" target="_blank" rel="noreferrer noopener">FUDing Bitcoin</a> because he wants miners to buy his carbon credits,” Mow added.



When possible, Blockstream’s mining operations source power from hydro and nuclear, what Mow described as the best zero-emission sources. He prefers those two power sources over wind and solar because helicopters must de-ice windmill blades, and the blades themselves get buried at the end of their serviceable life, while solar power’s photovoltaic cells have a long-tail carbon footprint from their rare-earth heavy manufacturing supply chain, he said.



<h3 class="wp-block-heading">Solana as a distraction</h3>



Ethereum was initially developed because of the belief that Bitcoin, the protocol, had limited programmability which would make the execution of smart contracts impossible. The Liquid Network, a sidechain-based settlement network, fixes this challenge, as well as Bitcoin’s settlement problem by moving things to a sidechain instead of the main Bitcoin network.&nbsp;



As interest in Ethereum as the rails that power everything from DeFi to NFT has grown, so has the congestion on the chain. With this congestion comes higher gas fees, and, as a result, a <a href="https://cms.blockworks.co/competition-in-layer-1-space-continues-to-heat-up/" target="_blank" rel="noreferrer noopener">constellation</a> of layer-1 blockchains like Solana that are all set to help clear this traffic jam.



“I don’t think too much about Ethereum,” Mow said, saying that the protocol as well as its layer-1s and layer-2s have a centralization problem.



Protocol partisanship aside, Mow might have a point in that the reliance on centralized services seems to be a flaw for Ethereum and others. Think about the reliance the industry has on the ubiquitous interface layer called Geth. Bugs in Geth almost caused Ethereum to do a <a href="https://cms.blockworks.co/bug-in-ethereum-interface-causes-inadvertent-chain-split-chaos-on-network/" target="_blank" rel="noreferrer noopener">chain split</a> in late August.



As another example of the flaw, Mow imagines a scenario where a security token offering (STO) is creating a whitelist of investors for a regulatory compliant token issuance which tracks ownership of the digital asset. And then, Ethereum does a chain split which would create duplicate records in parallel.&nbsp;



“How would you explain that to the SEC?” he asked, rhetorically. You can’t, really. Instead, there are side chains to the rescue, touting Blockstream’s asset management suite called <a href="https://blockstream.com/amp/" target="_blank" rel="noreferrer noopener">AMP</a> which runs on its Liquid Network and was used to help process its<a href="https://stokr.io/blockstream-mining" target="_blank" rel="noreferrer noopener"> recent STO fundraise</a>.



STOs have a world of potential ahead of them, Mow thinks, since there’s now liquidity in place as well as the infrastructure. You just can’t annoy the regulators, the third pillar. Having key regulatory data for the STO become duplicated thanks to an Ethereum bug would drive them ballistic and push back the offering class.



“I’ve been around long enough to see all these [altcoins] get pumped up, and then they vanish,” Mow said, asking where some of the best performing altcoins and tokens of 2016-2017 now are. “Shit runs downhill. Everything but Bitcoin is a distraction. Solana is a distraction.”



<h3 class="wp-block-heading">Miners, a hydro dam, and maybe a fusion reactor</h3>



Ultimately, the Bitcoin network needs miners as much as it does energy as the decentralization and strength of the network’s mining capacity lends to its security.



While many mining operations are in the process of <a href="https://cms.blockworks.co/bitcoin-mining-shifts-to-n-america-amid-fee-compression/" target="_blank" rel="noreferrer noopener">relocating</a> to North America from China given the hostile regulatory environment in-country, the mining machines are still made in China. Although this is changing as some parts of the manufacturing are moving to countries near China that don’t have the same trade war tariffs, there’s still a market for a made-in-North America miner. And that’s one of Blockstream’s post-fundraise projects.



To be sure, mining is one of the core components of the company, but as a Bitcoin infrastructure firm there’s more to Blockstream than just mining. There’s so much that needs to be built on Bitcoin — and Blockstream has freshly raised capital that values the company at $3.2 billion.



“We’re working on the first made-in-North America miner,” Mow said, saying that there’s a team already in place to design the ASIC — the chip at its core. Mow also said that this will be an “enterprise-grade” miner, designed to fit in a standard server rack in data centers instead of the usual ‘shoebox’ size miners are right now.&nbsp;&nbsp;



In order of importance, next to mining is energy. Not for this fundraise, but maybe one or two down the road — in a decade’s time — Mow thinks that Blockstream could one day own a whole hydro dam. Or, maybe a fusion reactor. “How do you fund something experimental? Well, you have bitcoiners with billions of dollars that are looking for cheap, reliable power,” Mow said. “Fusion is the future of humanity, and we’re probably going to get there with Bitcoin.”

Blockstream’s Mow Thinks Solana is a Distraction, Here’s Why

Jacquelyn Melinek

<div id="highlights-block_6124fc3a1a656" class="highlights">
 <ul>
 <li>The funding comes in tandem with Blockstream’s acquisition of the intellectual property of a bitcoin mining manufacturer called Spondoolies</li>
 <li>The new capital will help expand the company’s mission to build additional infrastructure in the future with a focus on the Liquid Network and bitcoin financial products</li>
 </ul>
 
</div>



Bitcoin infrastructure firm Blockstream announced it has raised $210 million in a Series B funding round, bringing the company’s valuation to $3.2 billion and officially making it a unicorn.&nbsp;



The funding was raised by two investors; an investment management company, Baillie Gifford, and iFinex, the parent company of the Hong Kong-based cryptocurrency exchange Bitfinex.&nbsp;



“In some ways this valuation is an affirmation of our focus to build on top of Bitcoin and our vision of rearchitecting finance with Bitcoin as the base layer. We still have a long way to go in achieving our goals and now we’re able to accelerate on multiple fronts,” the company’s Chief Strategy Officer Samson Mow said in an interview with Blockworks.&nbsp;



The company has raised a total of $299 million to date, including the latest $210 million, Mow said. “We raised a seed round in 2014 for $21 million, a Series A in 2016 for $57 million, and then added a $11 million convertible note,” he added.



<h3 class="wp-block-heading">Unicorns abound</h3>



Blockstream joins multiple other crypto-based companies that reached unicorn status during the month of August. CoinDCX became India’s first crypto-related unicorn with a valuation of $1.1 billion and FalconX raised $210 million in Series C funding, which brought its valuation to $3.75 billion, Blockworks previously <a href="https://cms.blockworks.co/falconx-coindcx-hit-unicorn-status-amid-uncertain-regulatory-environment/" target="_blank" rel="noreferrer noopener">reported</a>. 



Earlier this month, Singapore-based crypto financial service platform <a href="https://cms.blockworks.co/matrixport-raises-100m-and-hits-unicorn-status-with-1b-valuation/" target="_blank" rel="noreferrer noopener">Matrixport</a> announced it closed its $100 million Series C funding round also with a valuation over $1 billion. Bitpanda also shared a new, <a href="https://cms.blockworks.co/crypto-exchange-bitpanda-valuation-spikes-242-to-4-1b-in-five-months/" target="_blank" rel="noreferrer noopener">higher valuation of $4.1 billion</a> after closing a funding round of $263 million, just five months after its last valuation of $1.2 billion. 



The funding comes in tandem with Blockstream’s acquisition of the intellectual property of a bitcoin mining manufacturer called Spondoolies. This buyout will include rights to Spondoolies’ five different mining products, which the company says delivers energy-efficient mining equipment and the core team joining the company to build out Blockstream’s application-specific integrated circuit (ASIC) arm.



“We see a great deal of demand for both our enterprise-grade hosting of miners, as well as our financial products like the BMN (Blockstream Mining Note). With the new round of funding we should be able to expand in both financial products and mining, but the new ASIC we plan to bring to market will likely be our most disruptive endeavor to date,” Mow said. He also said they’re working with security token exchanges to list the BMN for trading.



The raise and acquisition will be used to add staff and advance Blockstream’s other mining products and services. The new mining infrastructure will be used for global partnerships, including a collaboration with <a href="https://cms.blockworks.co/blockstream-and-square-partner-on-solar-powered-bitcoin-mine/" target="_blank" rel="noreferrer noopener">Square</a> to develop an open-sourced, solar-powered mining facility in the US, the company said. 



<h3 class="wp-block-heading">Expanding its mission</h3>



Blockstream said the new capital will help expand the company’s mission to build additional infrastructure in the future with a focus on the Liquid Network and bitcoin financial products. The <a href="https://help.blockstream.com/hc/en-us/articles/900002016823-What-is-the-Liquid-Network-#:~:text=The%20Liquid%20Network%20is%20a,1%2Dto%2D1%20peg." target="_blank" rel="noreferrer noopener">Liquid Network</a> is a sidechain-based settlement network that enables faster, confidential bitcoin transactions and the issuance of digital assets for traders and exchanges, the company said. Since its launch, the Liquid Network has amassed more than $1.1 billion in network value and has seen growth with a number of platforms being built on the sidechain, it added. 



In the future, Mow said the company will focus on launching additional products through Blockstream Finance like a Bitcoin Alpha Fund, as well as work with the Liquid Network’s ecosystem to expand use of its assets.&nbsp;



“In the next few years, bitcoin adoption around the world will increase rapidly and our goal is to make all our bitcoin products and services more intuitive and easily accessible to those new users,” Mow said.&nbsp;



Want more investor-focused content on digital assets? <a href="https://cms.blockworks.co/events/digital-asset-summit-2021-2/">Join us</a> September 13th and 14th for the Digital Asset Summit (DAS) in NYC. Use code ARTICLE for $75 off your ticket. <a href="https://cms.blockworks.co/events/digital-asset-summit-2021-2/">Buy it now</a>.

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