Seven Companies You Wouldn’t Expect To Be Mining Bitcoin

What do health and wellness brands, logistics companies and your local Bitcoiner have in common? They’re all hash rate fiends!

As the Bitcoin network’s hashrate continues growing, the dynamics of the mining industry and the types of participants are more diverse than ever. Of course, most bitcoin investors are familiar with self-mining, billion-dollar-market-value giants like Riot Blockchain, and rumors of historic partnerships between energy titans like ExxonMobil and off-grid bitcoin miners. But beyond these somewhat typical and expected corporate actors, the mining industry has seen considerable growth in somewhat anomalous entities exploring mining and launching pilot projects of various sizes to gain exposure to mining.

From global shipping companies to health and wellness brands to cryptocurrency lending firms, mining is creeping into the business strategies of a growing number of unexpected entities. This article reviews some of the lesser-known, unexpected companies that are exploring bitcoin mining.

Health And Wellness Brands

Considering the popularity of carnivorism and seed oil-free diets in some bitcoin investor circles, news that a health and wellness brand announced a mining venture might not be the biggest surprise. In June 2021, Florida-based Graystone Company, a self-described wellness, longevity and anti-aging company, announced their plans for growing a bitcoin mining venture that launched one month earlier. In late September 2021 the company posted an update announcing that their operations had successfully mined nearly 0.1 BTC since launch, with over 2,000 TH/s of hashrate currently in operation and plans for a few thousand more to come online over the coming months. In January, Graystone said they were running a total of 50 Antminer S19j Pro machines — not bad for a wellness company.

Cryptocurrency Lenders

When someone thinks about corporate bitcoin miners, lending firms probably aren’t the first business that comes to mind. But two of the general cryptocurrency industry’s largest lenders are both actively mining with plans for expansion.

In May, 2021, BlockFi announced its new mining efforts in the form of a partnership with Blockstream’s mining unit. How much hashrate BlockFi is managing through Blockstream wasn’t disclosed, but the lending company said they viewed mining as a complement to their financial service offerings.

Celsius is also investing heavily in bitcoin mining, with $500 million spent on its mining efforts as of November 2021. In an interview, Celsius CEO Alex Mashinsky said his company operates 22,000 mining machines, most of which are Antminer S19 models. Like BlockFi, Mashinsky described his company’s mining efforts as a strategic complement to its lending business.

Shipping Logistics Companies

Shipping companies don’t usually mine bitcoin, but in February 2021, a self-described global shipping and freight-logistics integrated solutions provider jumped into the bitcoin mining arena. New York-based Sino-Global Shipping announced a new executive leadership team just over one year ago to lead their expansion efforts into bitcoin mining while still focusing on their core business. (So, a sort of corporate strategy like MicroStrategy’s iconic bitcoin-buying campaign, but for mining…) The announcement caused the price for shares of Sino-Global to jump 130%. Since the original announcement, the company has purchased a few thousand mining machines, entered a joint venture to manufacture new mining hardware and even accepted bitcoin as payment for their core services.

Asset Management Firms

Some of the world’s largest investment banking firms are the biggest shareholders for the public market’s leading bitcoin mining companies. But how many investment banks and wealth management firms mine bitcoin themselves? At least one: Horizon Kinetics. The New York-based investment management firm started their first bitcoin mining unit in 2017, launching a second mining initiative in 2018. The company reportedly manages roughly $7 billion in assets, and they cited the reason for exploring mining as a way to better understand Bitcoin itself. Horizon’s mining growth strategy has largely involved purchasing several thousand mining machines and negotiating hosting contracts for their hardware.

Electric Utilities Companies

The fact that a multi-billion dollar, electric utility company has a subsidiary running a bitcoin mining pilot program may not be the most surprising development for the mining industry, given the essential place that mining has in the energy markets of the near future. But considering that bitcoin mining as an industry is barely one decade old, E.ON’s Hungarian subsidiary is a pioneer in its own industry. The Hungary subsidiary of E.ON has partnered with another Hungary-based company, Enerhash, to install a small mining operation at one of their plants to test its ability to improve the economics and performance of the plant in various ways. What makes this partnership even more curious is how few media outlets have discussed it. Perhaps the lack of attention to E.ON Hungary’s mining activity was partially due to some of their press releases around the operation being written in Hungarian while most of the past year’s mining news has focused on North and Latin America.

Small Technology Companies

It’s important to mention that not every company who announces new mining ventures or pilot projects are legitimate. By joining the excitement and hype around bitcoin mining, many of these companies — typically publicly traded technology firms with small market capitalizations — are relying on desperate gimmicks to boost their share prices. Publishing a press release about bitcoin mining is easy. Building a sustainable mining operation is much harder.

So, in the case of many smaller companies that make similar announcements, determining which are legitimate explorations of the mining sector and which are not can be difficult. But at the risk of that context too heavily overshadowing the company named in this paragraph, one example of a smaller technology company that appears to really be mining is Jasmine Technology. The publicly traded, Thailand-based telecom company publicly disclosed its plans to start mining bitcoin in December 2021, triggering a mind-boggling 6,700% surge in its share price. At the time of the announcement, Jasmine Technology reportedly operated 325 mining machines and had mined 8 BTC.

Should Everyone Mine Bitcoin?

Having some direct or indirect exposure to mining probably makes a lot of financial and strategic sense to a multitude of investors and businesses. And seeing so many different types of participants enter the mining market is, in this author’s view, fantastic. Even though many companies are working to make products and services available so everyone can feasibly mine bitcoin, that doesn’t mean everyone should immediately start mining. Every new miner needs a good strategy and a slow, measured start to their operations. The growth of Bitcoin’s hashrate is lined with hundreds of failed miners who planned poorly. A successful mining operation always starts slowly and carefully. Reckless and haphazard beginnings never last.

Conclusion

Even though energy titans and multi-billion-dollar self-mining companies dominate today’s corporate mining landscape, a growing number of atypical businesses are incorporating bitcoin mining. Broader interest from these entities has few downsides, even though bitcoin mining is a relatively nascent and risky industry. How many of these operations will last more than one Bitcoin market cycle is an open question. But instead of just buying bitcoin, corporations who want to mine it too are a special class of bulls in a league of their own.

This is a guest post by Zack Voell. Opinions expressed are entirely their own and do not necessarily reflect those of BTC Inc or Bitcoin Magazine.