Bitfury, the Bitcoin mining equipment manufacturer and blockchain software firm has been valued $ 1 billion in a multi-million dollar funding lead by the billionaire investor Mike Novogratz and Korelya Capital with an $80 million investment.
Notably, the evaluation comes soon after the release of Bitfury Clarke, a new Bitcoin ASIC miner, developed by the firm to counter Bitmain’s new equipment – the 7nm Antminer. CEO of Bitfury, Valery Vavilov, stated that over the past 11 months the demand for the blockchain and crypto from companies and institutions has considerably grown. He said/l
“We see a lot of demand from companies and public institutions to put their services or products in the blockchain — especially in emerging markets, where administrative systems can be very inefficient.”
Incline Towards Mining and Blockchain
Even with Bitcoin facing bear market for a while, the hash rate of the Bitcoin blockchain network has increased substantially from 15 million TH/s to over 50 million TH/s. The rocketing hash rate indicates that the strength of the blockchain’s computing power has led to a surge in the breakeven cost of crypto mining.
Cryptocurrency analyst Barclay James reported in July that the breakeven cost of mining Bitcoin amounts approximately to $6,900, this inference is based upon the hash rate of the Bitcoin network, at the time which was 35 million TH/s. Currently, the hash rate of Bitcoin remains above 50 million TH/s, up 42 percent since July as per data by Blockchain.
According to that current hash rate, the breakeven cost of mining has well surpassed $7,500, even in regions with naturally cold climates and cheap electricity like China that reduces operational costs. James noted:
“China has some of the world’s cheapest electricity rates as well as average temperatures consistent with temperate regions. This is important as cooling is one of the largest overheads in mining. In addition, the country’s generally low operating costs also give it a competitive advantage.”
The rising breakeven cost of mining and the non-moving price of bitcoin has made mining the token is currently suffering from losses. Until the token recovers to the high region of $7,800 to $8,000, miners will continue to mine bitcoin with a loss of around 20 to 30 percent. The hash rate of Bitcoin, Ethereum, and other major cryptocurrencies, however, continues to surge, as does the demand for mining-focused ventures like Bitfury, Bitmain, and Samsung’s new foundry.
Earlier this year, Bloomberg reported that Bitmain is finalizing a $15 billion IPO and if Bitfury IPOs, it will target a valuation of $3 to $5 billion. Confident on the bright and shining future of the industry, mining companies and mining equipment manufacturers like TSMC and Samsung are joined in by a major venture capital firm in Korelya.
Korelya is financed by Naver, the largest search engine operator in South Korea utilized more than Google in the region. Bitfury is the first indirect investment in crypto from Naver.