Because we scaled our operations in a new industry, we had to discover what worked and what didn’t through trial and error — because there’s no handbook for this.
There was a time when you could mine Bitcoin from a laptop, or set up some mining rigs in your room and mine, profitably.
We scaled with the industry and bootstrapped our growth as we went, but those wanting to join today no longer have the option of starting at the bottom and working their way up.
While the Bitcoin mining industry has been growing quickly, it’s still very much consolidated with only a few key players holding the power.
There are only a few vendors supplying hardware at this point, and their production cycles are based on just a few chip manufacturers who are tightly controlling the supply — not to mention that we’re currently in a global chip shortage.
Speaking of operational efficiency, large-scale miners stay profitable when they have the edge over their competitors.
Make operational efficiency a priority.
The adage is “innovate or die.” In Bitcoin mining, where data centers have to stay powerful and fast to stay profitable, there’s no option but to keep innovating.
Innovation also means creating better, more efficient ways for your company to run, like creating software programs specifically designed for mining operations management.
Not all locations will offer the same sources of electricity for the same prices, so miners need to find locations that not only have abundant, cheap electricity but to ensure that that electricity is green and sustainable as well.
So we rented 747s to get the machines to us quicker, which allowed us to generate millions in extra revenue that would’ve been lost due to standard shipping.
The race instead is to be as big as you can because scale is directly correlated with revenue: The larger you are, the more profit you make.
There are many more lessons that we’ve learned, and plenty of lessons that we’ll learn in the years to come.
Marco Streng is the CEO and a co-founder of Genesis Group and Genesis Mining — one of the largest crypto mining companies in the world.