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Texas-Based Bitcoin Mining Startup Now Relies on Virtual Power Plant

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Mon, 06/08/2020 - 14:45
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Alex Dovbnya
A Peter Thiel-backed Bitcoin mining startup reveals the benefits of its virtual power plant
Texas-Based Bitcoin Mining Startup Now Relies on Virtual Power Plant
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In a new tweet, Alex Liegl, the co-founder of Layer1, has revealed the benefits of using a virtual power plant for mining Bitcoin.

He claims that Layer1’s virtual data centers stop operating during market peaks for a discounted price of one per megawatt-hour (MWh), adding that there is no need to build physical power plants for handling marker peaks.   

Layer!
image by @alexanderliegl

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A novel trend in the energy industry

A virtual power plant is a cloud-based data center relying on heterogeneous energy sources in lieu of a single power station.  

By creating a decentralized power network operated with the help of special software, it is possible to cut down costs and ensure 24/7 reliability.     

According to Navigant’s estimations, this market is expected to reach $2.1 bln by 2025 when it starts to come of age.

Liegl recently told Forbes that they were building a virtual power plant with integrated Bitcoin derivatives

I can’t think of something more irrational at this point. It’s like if I wanted to dig a hole in my backyard and try to get oil out of the ground.      

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A Texas-based mining hub

As reported by U.Today, Layer 1 secured $50 mln from billionaire Peter Thiel and other investors back in October 2019.

The startup has an ambitious goal of stealing the mining crown from China, which is currently responsible for a staggering 65 percent of the world’s total hashrate.

Texas, the number one natural gas producer in the U.S. which also boasts a plethora of wind turbines, appears to be destined to become a new mining hub.

Because of their contracts with grid operators, which stipulate shutting down BTC mining during emergencies, Layer 1 is able to cut down its energy cost to just 10 percent, which, in turn, brings down the cost of producing one BTC to just $1,000.

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About the author

Alex Dovbnya (aka AlexMorris) is a cryptocurrency expert, trader and journalist with extensive experience of covering everything related to the burgeoning industry — from price analysis to Blockchain disruption. Alex authored more than 1,000 stories for U.Today, CryptoComes and other fintech media outlets. He’s particularly interested in regulatory trends around the globe that are shaping the future of digital assets, can be contacted at alex.dovbnya@u.today.