$46 Million: Canadian Mining Firm Buys 0.5% of Bitcoin’s Total Hashrate

Francisco Memoria
  • Canadian mining firm Vogogo has recently spent $46 million to acquire 0.5% of BTC's total hashrate
  • The move saw it acquired 14,000 ASIC miners, to launch a large-scale mining operation in mid-July.

Canadian cryptocurrency mining firm Vogogo has recently gotten to 0.5 percent of bitcoin’s total hashrate, after purchasing 14,000 ASIC mining machines for a total of $46 million. The move comes with the potential for it to expand further in the bitcoin mining business.

According to a recent press release, Vogogo purchased 14,000 ASIC S9s, each with a hash rate of 13.5 TH/s, as well as cooling units and required electrical equipment from a company called 828 LP.

The move will allow the Canadian mining firm to increase its current hashrate by 200 percent to 0.5 percent of the network’s total hashrate. The company’s president and chief executive officer, John Kennedy FitzGerald, stated:

Closing of the 828 transaction provides Vogogo with a total of 18,125 mining machines and 36 megawatts of available power, enough for current operations plus expansion capacity, and adds significant size and scale to the Company’s cryptocurrency mining operations.

John Kenned FitzGerald

The mining rigs are now being installed outside Montreal, with 10,500 already being ready to operate. The company is planning on launching its large-scale mining operation in mid-July, after investing $46 million in equipment and infrastructure to add in an additional 4,000 mining machines in the future.

Per the press release, the $46 million were divided into $36 million in cash, plus a $10 million promissory note, which “bears interest at 8 percent annum, for a two year term, with monthly interest payments during the term of the note.”

Notably, Vogogo itself was created in 2014 as Southtech Capital Corporation. Before changing its name, the Canadian firm was a cryptocurrency-focused payments processor, that then decided to acquired cryptocurrency mining company Crypto 205 and 1,500 mining machines.

Bitcoin mining has recently come under fire, as mining hardware manufacturer Bitmain, through its mining pools, is said to be close to owning 51 percent of the network’s hashrate, which could lead to potential attacks on the flagship cryptocurrency, similar to those cryptocurrencies like Verge and Bitcoin Gold endured.

Earlier this year, Morgan Stanley analyst Charlie Chan argued that bitcoin mining at prices below $8,600 isn’t profitable for anyone, except ASIC miner vendors like Bitmain, which can see BTC go down to $5,000 to maintain a profit.

BitFury, another ASIC vendor, argued the company can profit until BTC goes down to $2,500. At press time, according to CryptoCompare data, the flagship cryptocurrency is trading at $6,700 after rising 1.8 percent in the last 24-hour period.