Hut 8 is a company that claims to be a new kind of mining firm. As bitcoin’s price crashes this week, some have taken notice of the increased hash rate in the bitcoin mining arena, and some are very curious how new companies are looking to extract new coins.
Hut 8: New Ways to Access Coins
According to Andrew Kiguel, the CEO of Hut 8, the company’s name is taken from a project led by Alan Turing, a British mathematician who broke the Nazis’ enigma code during WWII. In a recent interview, he describes his company’s mining model:
As a public company, Hut 8 strives to be a low-cost producer of bitcoin and maintain an inventory of bitcoin for appreciation. Most competitors are private and not accessible to investors. The public ones do not hold an inventory of bitcoin. Thus, they do not provide exposure to bitcoin over the long term… Hut 8 operates at approximately 963 peta hashes per second. The amount we mine is dependent on the competition as the amount of bitcoin produced daily is relatively fixed. At current rates, Hut 8 represents over one percent of the overall market.
One of the major advantages of the company, he explains, is that Hut 8 provides access to BTC without forcing individuals to purchase the coin. Instead, they can purchase stock options in the company. He comments that many people are interested in purchasing bitcoin, but either never follow through or give up halfway through the process.
As it stands, in order to purchase bitcoin, one must give private data to an exchange or to an offshore financial institution, and he says that most people just aren’t comfortable with that yet.
He says that for the most part, this model has served the company well, and Hut 8 is garnering interest from several institutional players:
We have had interest from around the world for having a high-profile investor group, board of directors and being one of the largest bitcoin miners in the world. Investors that are interested in investing in bitcoin but require a publicly listed entity to do so find Hut 8 to be compelling.
Change Is on the Horizon
In the long run, the crypto world is adapting quickly. Many people are interested in holding coins but are looking for new ways of gaining access to them. The venture, he says, is working every day to come up with creative ways of assisting its clients and satisfying their “crypto needs:”
Bitcoin is evolving quickly. The most significant issues surrounding bitcoin investment – security and regulation – are being resolved. Fidelity, Goldman Sachs (via Bitgo), and most recently NYSE, Microsoft and Starbucks (via Bakkt) have started offering institutional custodial services for bitcoin… At Hut 8, we believe bitcoin represents the future of digital money and the best form of money available today.