Name: DenverBitcoin

Country: Denver, US

When did you get into Bitcoin?  

Early 2018 — around the beginning of February. I was curious to understand how the “scam had failed” due to the “mining death spiral” and I began my journey to understanding how cryptography + proof-of-work + thermodynamics = digital scarcity.

Best Bitcoin experience and worst Bitcoin experience? 

Best? — Either flying to Canada to tour UpstreamData or hanging out in LittleRock and doing a friendsgiving with bitcoiners in 2020. Both were life-altering experiences, and I am so grateful for them.

Worst? — Going to a meetup in Denver, and it was about how some altcoin network was going to change the world and beat bitcoin. I’m not welcome back at that group.

What is the biggest fail you have witnessed over the years?

Grapes McCullough’s video when he says “Bitcoin isn’t a real investment and what’s bitcoin doing...it’s at… Fifteen thousand (shocked) Fifteen thousand?” Hard to watch but can’t look away.

Explain your connection with oil and gas and Bitcoin mining? 

I was working in oil and gas in a position where I worked closely with upstream producers/explorers — the people drilling, operating, and producing wells. Just as I was becoming aware of how much stranded energy (energy that can’t be economically brought to market due to geographical location/infrastructure) existed in the world, I was learning about Bitcoin mining. Once I learned about a computational hash and how thermodynamics relate to computer science, I realized there was potentially an immense opportunity.

Give us a quick rundown on your Bitcoin mining business?

It’s quite simple — I invested in infrastructure (power generation, data center, ASICs, etc) in order to help an oil and gas operator mitigate their wasted/flared natural gas volumes. Oftentimes oil and gas operators are fined for the amount of gas that they flare/vent/waste, so my ability to reduce that volume saves them money. So effectively I am saving them money without charging them and, in turn, I gain access to a reliable and very economic primary energy source — sweet methane gas. Effectively I’m bringing stranded energy to market by converting it into electricity, and then converting that electricity into computational work — then I sell that computational work to a bitcoin mining pool. It’s a harmonious relationship and I believe the upstream energy, power-generation, and bitcoin mining industries are all going to synergistically leverage one another. I believe we see incredible amounts of growth in these industries throughout this decade.

How has it been building your mining business through the bear market into this emerging bull market?  

In hindsight, I ended up having pretty lucky timing considering when my company first started mining. It was really easy and inexpensive to source ASIC’s when the price is below $7k and network hash rate is above 85Eh/s — nobody could plug in their ant miner s9’s or s15’s at home and be profitable — but I could plug em in at a gas well and be profitable. So I was fortunate enough to get secondary hardware very quickly and economically — whereas today it is very difficult to find a reasonably priced quantity of the same machines. The bear market was a time to endure seemingly minimal rewards in order to wake up on a day like today when the price is 5x higher and the hash rate has only increased 70% — in the end it’s all worth it. 

What are the biggest challenges you face mining Bitcoin in the US?  

Sourcing ASIC’s is probably the biggest upfront hurdle to being in North America. But considering how much stranded energy exists on this continent, I think there is a great advantage to mining in the U.S/Canada with nearly endless opportunities to expand.

What do you think the new Biden administration means for Bitcoin and your mining operation?

Maybe I’m crazy, but I think that any mining operation that is using stranded/wasted energy as the primary source for power generation will be the absolute last kind of operation to be regulated in any way. If I were mining bitcoin on grid power in the U.S (using a hosting facility somewhere, etc), I would be quite afraid of regulation and legislators shutting down bitcoin mining due to “environmental impact / electricity prices / etc.” I feel we’re in a defensible and advantageous position to be  mining bitcoin.

Where should people go if they are interested in learning more about Bitcoin mining?

Great question — I believe Bitcoin Magazine and CoinBeast dotcom have pretty great resources and articles explaining what Bitcoin mining is and how it works, etc. If anyone wants to see how mining in the oilfield looks, check out UpstreamData’s twitter/website, as well as follow their founder Steve Barbour on twitter — He’s the pioneer of this space as well as an exceptional person who is building to make the world a better place.

2020 has been a crazy year with covid and the lockdown of global economies? How has this helped or hurt Bitcoin?

2020 was great for demonstrating just how much reckless money printing and monetary expansion central banks are willing to enact in a moment of “crisis.” It demonstrated how reliant this economy is on an increase in spending while negative yielding treasury bonds became a reality. It has shown just how incompetent governments are at preventing and solving issues. It has shown that if you hold certain beliefs, companies like Square or PayPal may demonetize your business overnight. 2020 has highlighted the need for a trustless monetary base with an immutable supply schedule — 2020 has shown just how badly the world needs bitcoin.

What are your thoughts about the Biden administration’s proposed covid stimulus injecting another 1.9 trillion into the US economy?  

I think it’s the beginning of a period of even more monetary expansion than during the Trump administration. Over 75% of all U.S dollars were printed after 2009 and it wouldn’t surprise me if in a couple years we’re able to say the same thing about 2019. I imagine Universal Basic Income is on the horizon and will likely be enacted during these next four years.

Do you think calls for more government regulations over digital currencies will stifle or help the Bitcoin economy?  

I believe it might create barriers to entry for any business looking to provide a bitcoin-related service (exchanges, hardware, etc) and could slightly hinder progress — but ultimately the financialization of Bitcoin is inevitable, so legislators & lawmakers will eventually need to explicitly address this new form of property. Their attempts to regulate and control Bitcoin are futile, ultimately, but governments don’t know how to do anything other than forcefully inject themselves into an economic equation and create deadweight loss. It’s what they do so I expect them to try.

What are your comments on the latest controversial FinCen wallet rule?

I think it’s one of the first examples we’re going to see of attempted control/regulation of Bitcoin. It’ll be interesting to see what kind of ways the government tries to oversee Bitcoin private-key ownership. I think it just became riskier to have your Bitcoin held by a 3rd party custodian or sitting on an exchange. 

Bitcoin just hit 42k. Where do you think we go from here? 

I’m so incredibly bullish on bitcoin. Considering the ways in which Bitcoin mining reshapes the energy production and power generation industries, I only see Bitcoin’s demand skyrocketing. We already see it with countries like Venezuela and Iran mining Bitcoin and settling their international trade in BTC, as well as large oil & gas companies like Equinor announcing their plans to mine Bitcoin. As more global entities begin to understand the characteristics that make Bitcoin a store of energy through time, I think we’ll begin to see even more powerful companies and nations begin to accumulate and hold this universal bearer-asset known as Bitcoin.

What do you think the biggest learning curve is for people new to Bitcoin especially now that the market is melting up?  

Understanding how digital scarcity can even exist — everything we know about the digital world is that it is NOT scarce. You can copy/paste anything or just re-program the software and change the amount of dollars/tokens/etc. Understanding how Bitcoin is a sound monetary network due to encryption and the physical limitations (physical law) to overcoming that encryption.

Why do so many noobs go down the route of shitcoinery and what warning can you give them?  

Everyone comes to get rich, only some stay to get free. Just seems to be human nature — people discount the idea until the price gets to a point where they force themselves to take a second look. Shitcoins do a very good job at preying on a person’s unit bias, “why only hold 0.1 Bitcoin when you can hold 1000 of these other coins that are brand new and will probably get to Bitcoin’s price one day.” Most of these projects simply prey on greed and ignorance while leveraging human nature to their own benefit. It’s natural for a truly free market to have such imitators, but none of them will compete with bitcoin long-term.

How do you feel about Etherium or DeFi and why?  

I feel that proof-of-stake is a flawed consensus mechanism and etherium isn’t money, nor is it a sound protocol. I don’t think much about them, to be honest.

What are your thoughts on guys like Michael Saylor dumping a billion dollars into Bitcoin and other big companies following?  

I think it’s exciting and bullish. Every time there are profound inventions, it takes bold first-movers to begin the conversation. I can remember when companies that were moving all company communication to email was a topic that was discussed on bloomberg — now such an analysis would seem ridiculous. I think we’re seeing the same with Bitcoin — at some point it will be normal for every company to allocate a % of their balance sheet to Bitcoin due to its unique characteristics. 

What kind of oil and gas money do you see pouring into Bitcoin and why?  

I see a lot of investment dollars going into power generation and infrastructure builds. This is natural because now it makes more economic sense to invest in building power-generation infrastructure because Bitcoin mining makes every single ROI more attractive. Companies no longer need to fear the cyclical nature of how humans demand electricity — anytime there is an excess of electricity produced beyond demand, it can now be economically brought to market by mining Bitcoin. The entire investment profile has become more attractive so I’m slowly starting to see some big money get motivated.

Why is wall street all of a sudden starting to warm up to Bitcoin?  

Price is a powerful manipulator of opinion. Also, from what I’ve read, it seems many high net worth individuals are demanding exposure to Bitcoin — both Fidelity and Goldman came out and said their customers have increasingly been asking about getting exposure to Bitcoin. Price is popping, MainStreet is interested, WallStreet comes in and acts like they’ve been here the whole time hah. Almost like clockwork.

What is your opinion on Bitcoin Maximalists?   

I think it’s logical to conclude that none of the 7,000+ “cryptocurrencies” are even worth comparing to Bitcoin. Maybe a couple will have some use-case or serve some purpose that solves a problem — but ultimately we’re talking about sound money. Bitcoin is the M0 money supply of the world, an immutable and trustless monetary base that cannot be manipulated, debased, or corrupted. It is the only truly decentralized and sound information network that can be independently audited, it makes perfect sense that the first trustless global information network would serve as the first global monetary network. None of these other digital tokens are able to serve this purpose and be the globally recognized monetary base, so they’re not worth comparing to Bitcoin imo.

Why is it important to call out the bad actors in this space and is there anyone you want to call out?  

Well many bad actors not only undermine the call to empower individuals, they actually cause harm. Look at the dozen DeFi rug-pulls that happened in 2020 where the founders of the project literally just ran off with the money. Prices dropped 95%+ in a day, people were misled and lost the fruits of their labor. That kind of behavior ought to always be called out and the purveyors of such harm held in contempt. Reputation is something that is earned through honest contribution and lost by harming others. This is how we get better and become more effective at empowering individuals so that they can be free from their central bank’s tyranny.

Who are some of the most hardcore Bitcoiners you know and why?  

BlockBain, SGBarbour, BitVolt7 — all are mining Bitcoin and for some reason it seems those who mine Bitcoin hold a deeper level of conviction than most. Maybe because we understand the amount of energy required to produce Bitcoin, as well as how difficult it would be to attack the network. I think these gentlemen might agree with me when I say that “Bitcoin mining IS Bitcoin.”

What potential obstacles in the road do you think Bitcoiners need to pay attention to? 

I think the biggest obstacle is going to be misinformation about Bitcoin’s energy use. I fully expect climate alarmists to attack Bitcoin on the premise that Bitcoin mining uses too much energy and destroys the planet. I think this is the largest obstacle Bitcoin faces because of how powerful and radical the climate alarmists and environmental lawmakers have become. They already vilify entire industries (like oil and gas) and label them as immoral and unsustainable, they’ll do the same with Bitcoin mining. The reality is that Bitcoin mining mitigates waste-energy and incentivizes innovation throughout all aspects of energy production unlike anything else on earth. They will say that Bitcoin mining causes hurricanes and disproportionately affects poor communities in negative ways and that it needs to be shut down / banned. This nonsensical narrative will be tough to endure, but the good news is that the truth is on our side — bitcoin is really great for global energy production.

What are some of the latest Bitcoin innovations that have you the most excited? 

Jack Maller’s use of Lightning network and Strike Global is very exciting — I’m very interested to see what kind of growth they see and how 2021 shapes out for him and his team. Also really excited to see if any new ASIC manufacturers pop up and fill the massive void that exists within the hardware-supply side of Bitcoin mining. I think some of the greatest opportunities align with capturing the inevitable demand and consumer surplus of demand that will arise as more investment dollars are directed toward sourcing stranded/economic energy sources.

Name some of your favorite information sources and/or podcasts in the space.

CoinBeast.com, BTCSessions, FunWithBitcoin Podcast, UpstreamData, anything from Saifedean, Matt Odell & TFTC.

Any last thoughts?

What a time to be alive!