Square CEO Jack Dorsey said late Friday that the company may be getting into the bitcoin mining business.
Dorsey tweeted That the company is considering “a dedicated, open-source, silicon-based bitcoin mining system for individuals and businesses around the world.” Bitcoin price surged above $62,000 after Dorsey’s series of tweets pushed the world’s most popular cryptocurrency towards all-time highs.
Dorsey’s goal is to make cryptocurrency mining — the process of creating new bitcoins by solving increasingly complex computational problems — easier to access, much like Square’s original vision was to make it easier for small businesses and independent owners to make credit card payments. He wrote that bitcoin mining should be “as easy as plugging the excavator into a power source.” Today, the bitcoin mining industry is dominated by large-scale players who can purchase tens of thousands of ASICs, a type of specialized equipment used to mint a new currency.
The team led by Jesse Dorogosker, Square’s head of hardware, will begin studying the technology needed to carry out this project, according to Dorsey.
“We will incubate the Bitcoin mining ecosystem project within the Square hardware team, starting with engineering, design, and prototyping the most efficient silicon, hashing algorithms, and power architectures.” Dorogusker wrote in a tweet.
Dorogosker said Afshin Razaei, the Square Silicon team leader and engineer in Toronto since 2015, will lead the project, given that silicon is the core of this new initiative.
“Building a strong core in silicon is just the beginning. Delivering the value we envision requires a full suite — silicon, hardware, software, manufacturing, and innovative distribution that can help us support the entire world,” continued Dorogusker.
Dorogusker is also leading Square’s project to build a crypto wallet.
Dorsey Says Bitcoin Mining Should Be Easy
Dorsey, who is also the CEO of Twitter, as he explained his reasoning about why Square is looking to enter an already crowded field.
“Mining needs more distribution,” Dorsey wrote in a tweet. “The more decentralized this is, the more resilient the Bitcoin network becomes.”
Dorsey shared in August that he was personally in the process of minting bitcoin himself, with the help of Compass, a bitcoin mining service provider. In his tweets late Friday, the Square CEO called for this kind of equal access to the mining world.
“Mining is not for everyone,” Dorsey wrote. “Bitcoin mining should be as easy as connecting an excavator to a power source. There is not enough incentive today for individuals to overcome the complexity of running a miner for themselves.”
The Square CEO has continued to share his thoughts on the need to put more emphasis on vertical integration, as well as on silicon design, which he says is too much of a focus among a few companies.
The Square chief has also been involved in the energy controversy surrounding bitcoin’s carbon footprint.
“Driving towards clean and efficient energy use is great for Bitcoin’s economics, impact, and scalability. Energy is a system-wide problem that requires silicon innovation, software, and integration. What are the biggest opportunities here?” Follow Dorsey.
The announcement from Square comes as the United States overtakes China for the first time ever as a global destination for bitcoin miners. The United States is also full of renewable energy sources.
Washington state is the mecca of hydro-powered mining farms. New York produces more hydroelectric power than any other state east of the Rockies, and it counts its nuclear power plants toward its goal of 100% carbon-free electricity. Meanwhile, Texas’ share of renewables is increasing over time, with 20% of its energy coming from wind as of 2019. The Texas grid also continues to rapidly add more wind and solar power.
Texas also has an unregulated power grid with real-time pricing that allows customers to choose between power providers and, most importantly, its political leaders are pro-cryptocurrency. These are dream conditions for miners who want a good welcome and cheap energy sources.
“If you are looking to move hundreds of millions of dollars of miners out of China, you want to make sure that you have geographic, political, and judicial stability. You also want to make sure you have proprietary rights protections for the assets,” said Darren Feinstein, co-founder of Core Scientific. You move to another place.”