Source: btcmanager.com

As bitcoin is turning into a mainstream currency, a lot of new players are trying to get in the mining industry. In 2017 alone, the cryptocurrency saw its biggest rise ever and with the meteoric rise along came new investors and new players eager to have their share of the Bitcoin pie.


Tokyo-based GMO Internet Group announced on September 7 it was entering the Bitcoin mining industry. The GMO Group is about to invest more than $3 million to begin its mining operations in the first half of 2018. The Group says it will invest more than 10 percent of its non-current assets, which stood at around $32 million at the end of last year.


Founded in 1995, GMO is well-known for its high-quality registering domain names and hosting web services. But recently, it has caught Bitcoin fever. In January 2017, the Japanese company announced an entrance into the bitcoin wallet market. The GMO Group believes that digital currencies like bitcoin are the future which will eventually create a global “borderless economic zone” and evolve into “universal currencies.”


A New Mining Arms Race


According to the announcement, GMO is also making plans to develop its own mining hardware, claiming they will operate at an unprecedented degree of efficiency. So far it was revealed that GMO chips are going to use 7-nanometer (nm) nodes, which make it by far the most efficient chips ever produced, able to be four times more energy efficient than the current industry standard 16 nm nodes.


If the group successfully introduces the new hardware, it can trigger a new mining arms race in the bitcoin industry. Since Bitcoin miners compete to find a block and get the biggest reward, once these new chips are introduced, the rest of the miners will have to start looking for an upgrade otherwise, they will not be able to compete. According to experts in the field, this will streamline the development of the next generation of mining chips and take the industry to higher grounds as new and strong players begin to hop in.


A new Bitcoin mining solution is capable of shaking up the industry; this means that miners who have not reached the Return on Investment (ROI) using their current mining rigs until then may end up with obsolete mining rigs on their hands.


Diego Guiterrez, the chief executive of the mining software company RSK Labs, commented:



“The ones at risk are the ones still trying to recover their investment because they will be four times less productive. The other mining chip developers will surely follow and create their own 7 nm chips if they are not already doing it.”



Guiterrez expects to see most major players going for an upgrade as the technology for 7 nm chips becomes generally available to the foundries who do much of the work of the production of the chips.


Cutting Costs


The company is looking to cut the costs of the whole operation and already designated its mining operation site to be located in northern Europe. The location was selected because the weather is colder and where, in some countries, an excess of electric power is produced thus making the input cheaper. This way, the group looks to deliver competitive prices as an attraction to get more people in.


The business model the GMO group is seeking to apply is very similar to many that are already in place such as Bitmain. The company is planning to manage the business from its production phase to the end consumer. GMO will develop its own chips and assemble them into mining rigs, operate its own mines, and rent or sell them to the end consumer.


GMO’s arrival on the scene will certainly cause tension in between competitors in the industry. Nevertheless, competitive pressures will benefit both the integrity and stability of the network. That means that there will be lesser chances for a 51 percent attack to happen with more players stepping in.


The post Japan’s GMO Invests over $3 Million, Enters Bitcoin Mining Industry appeared first on BTCMANAGER.



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