Microsoft-Led Consortium Invests $1.3B in Decentralized Storage Facility in China to Mine FIL

Microsoft-Led Consortium Invests $1.3B in Largest Decentralized Storage Facility in China to Mine Filecoin (FIL)

Chinese tech consortium IPFS Union is investing over $1.3 billion to build China’s largest decentralized storage in Jiangxi Province of Fuzhou City. As part of its “Big Data Industrial Park” project, the facility will mine Filecoin (FIL), a peer-to-peer data storage platform, allowing users to buy and sell storage without a third party, a blog post by Filecoin read.

Filecoin has been attracting wide attention across China in the past few months since the network upgraded to mainnet. According to the post, this mining facility is expected to be the largest distributed storage facility in China to boost the union’s vision in big data.

The consortium boasts of some big tech players such as Microsoft, AMD, Huawei, Alibaba, and SAP leading the globe in cloud storage, large cluster data management, and internet infrastructure for the past ten years.

“We’ve been active in the blockchain space since 2016, primarily focused on digital currency investment, but not really participating in development.”

“We were looking for a project with both investment value and a mature ecosystem.”

Filecoin has been one of the top performers so far across the crypto market, popping into the top 15 largest cryptos by market cap earlier in the year. The project was added to Grayscale’s Investment Trust shortly after gaining a listing on Coinbase Pro in December.

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Author: Lujan Odera

Bitcoin Miners Turn to Derivatives to Increase their Profitability as Halving Looms & Fees Decline

Bitcoin miners are currently earning 12.5 BTC for each block they mine successfully. The third reward halving will cut down this reward to half to 6.25 BTC.

There are about 5 months left when this event will occur and put a dent in miners’ revenue. But before that could happen BTC miner fees are already down over 24% from the prior week.

The 7-day average for Bitcoin miner fees is down to $166,669, which is down 52% from last month but still up 188% in 2019.

But this needn’t be negative and can be a lagging effect of fewer transactions or better fee estimation by wallets or because of more effective transactions.

Actually, it was in March this year that Bitcoin mining started seeing an uptake after falling to its lowest in February 2019 since August 2017.

Bitcoin Mining Profitability on the Decline

Back in August, Coin Metrics reported that the all-time revenue for Bitcoin miner topped $14 billion. While it took eight years for miners’ total revenue to surpass the $5 billion, the next $5 billion were exceeded in just eight months.

This is because of the increase in Bitcoin prices. In 2019 YTD, Bitcoin is up about 90% after losing 84% of its value in 2018 from the all-time high of $20,000 in 2017.

Most importantly Bitcoin has been making a higher yearly low, from $0.01 in 2010, $4 in 2012, $185 in 2015 to $3,200 in 2018.

Bitcoin mining profitability that has been on an uptrend since December topped in June this year and has been on a decline ever since, as per Bitinfocharts. This is because while BTC price has taken a drop from 2019 high of $13,900 in June, the hash rate continues to climb.

Towards the end of October, Bitcoin hash rate hit an all-time high at 110 Th/s and though it has taken a fall since then it is staying around 90 Th/s.

As such, miners are now looking to hedge the hash rate and wild swings in electricity that can easily turn their profits to losses.

Attracting Traditional Investors

A spike in hash rate means a need for more electricity that drives up the cost and eats into their profits. But now come crypto miners have found the answer in derivatives that will allow them to hedge the hash rate.

These derivatives will allow the miners to price in risk and provide clearer projections of cash flow which is a prerequisite for investors. However, the market is at a very early stage.

“We’re building products around hashrate and difficulty,” Richard Rosenblum co-founder of crypto trader GSR told Reuters, but “It’s going to take more than a few months for there to be significant liquidity.”

In the current environment of ultra-low interest rates, traditional investors are looking for high-yield return options and crypto miners can offer them an attractive proposition.

But Marco Krohn, co-founder of Hong Kong-based Genesis Mining said “these people tend to ask questions” and being “risk-averse.”

And to attract such investors, mining firms are looking at controlling their risks in terms of price and hash rate through financial tools.

According to these firms, the adoption of derivatives in the mining communities has increased in recent months and the market for such products was growing more liquid. Also, more players are on the sidelines watching how these perform before they jump in themselves.

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Author: AnTy

The Story Behind the Renowned Icelandic, “Big Bitcoin Heist”: From Mastermind to Execution

Iceland is known for having the world’s largest bitcoin mine. Given so much space and low electricity, it is a spot that most eye when it comes to Bitcoin mining. However, the country is also known for having witnessed five crypto data centers that were broken into in a span of two months reports Vanity Fair. The accumulated loss? A gross $2 million. Turns out, 60% of them had a crew in common, led by mastermind, Sindri Thor Stefansson and his partner in crime, Hafthor Logi Hlynsson.

Who is Sindri Thor Stefansson?

Stefansson (32) is considered the mastermind of what Iceland calls the “Big Bitcoin Heist,” and many know him as being a famous thief. In the interview with the news outlet, Stefansson seems to be pleased with the work he’s done, stating:

“It’s the biggest burglary in the history of Iceland. So, I guess it’s my biggest yet.”

Taking everyone back in time, the thief shared that he’s always been a “naughty boy” as young as the kindergarten times, where he smashed into the school window to open the door. It’s supposedly the thrill that arose from such activity that led him towards this path.

He met his ‘best friend and partner in crime,’ Hlynsson at the age of six. What started as a combined effort in stealing from an elderly working at a shopping small, led the duo to commit the Bitcoin Heist. As he aged, he involved himself in all the things people are advised against, and by his early adulthood he had 200 cases of petty crime.

While in prison, Stefansson decided to get clean and start a new life. He got married and graduated with a degree in computer science. Having done odd jobs for far too long and in need of more money, he eventually came across Bitcoin mining (something that he was interested in).

Mr.X to Have Opened Stefansson’s Eyes

In 2017, Stefansson supposedly made an acquaintance called, Mr. X who is described as being a ‘dangerous international investor.’ Sharing his visions of mining Bitcoin,

Mr. X stopped the lad by asking, “Why go to all the expense and effort to start your own Bitcoin mind, when you can get a head start into the business by stealing computers from the competition.”

What did Stefansson get out of this? 15% of the goods, which supposedly amounts to 1.2 million per year forever. Stefansson was amazed by the entirety of computers being able to create money. He said:

“You’re stealing machines that make money. Making money while you sleep.”

The Plan Right Up Until Its Execution

Mr. X was supposedly the one to have rounded up a crew of five Icelandic men in their twenties. Given that everyone knew each other, the plans will be discussed at a friend’s house in Reykjavik. The crew itself can be considered a hierarchy, with the lower step consisting of 2 boys who had clean police records, then comes “the brains”, Hlynsson and obviously there’s the boss, who the police deem is Stefansson, but to him it was all about following Mr. X.

Stefansson had all the possible tools he needed for the team to succeed in the Bitcoin Heist. They even thought out communication, i.e. Telegram, because it is encrypted, and messages can be self-destructed. Some communication also took place in a Facebook Group called, “Foruneytid” (or the Fellowship).

At the time of the Bitcoin Heist, there supposedly wasn’t any securities walking around, as most simply stared at security monitors. The Heist started with breaking into Algrim Consulting data center. Then, they tried to attempt it at the Borealis Data Center, only to fail, but according to Stefansson, the police were slow in investigating the situation. Although what they had stolen sufficed, it seems like the crew wanted more power.

Stefansson at some point got an innocent call from his friend from school who was working as an electrician. He shared that the AVK Data Center required more electricity for something called Bitcoin. After having studied the AVK Data Center’s area and realizing that it was an early establishment with no security, it automatically became the next victim.

Stefansson and his buddy eventually got arrested but given how polite they were and having conversated with the thieves for three days, the police had nothing on them, and they were released.

In the same way, with additional reach to an insider, they hit the Advania Data Center. Eventually arrested again, but this time Stefansson was caught for good because he failed to delete information from his phone, which the police were able to access.

A Loophole in the Icelandic Law

According to the reportings, staging a prison break is not considered breaking the law because “all human beings are naturally entitled to freedom and thus cannot be punished for seeking it.” This is exactly what Stefansson did after some three months passed, and eventually flew to Stockholm under someone else’s name. Apparently, Sweden doesn’t require Icelandic travellers to carry a valid ID or passport.

Having reached Amsterdam at some point in his travels, he met with some members of his crew only to get caught again because of a picture of the trio that went on Hlysson’s Instagram. Ultimately, he was sentenced with four-and-a-half-years in prison.

As for Mr. X, he still remains at large with the stolen 550 computers. When Stefansson was asked if he were Mr. X, how he’d rate the entirety of the Heist, he replied, “A masterpiece. I just wish I had done it.”

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Author: Nirmala Velupillai