Is 21.Co Really Building Digital Gold – Part 2

The story of 21e6 continued from the last post. This is a truly exciting story on the future of Bitcoin mining.

Continuing The Story Of 21.Inc

As it was sold as a top-secret project from the beginning, 21e6 allowed people to invest without needing to come out as public supporters of Bitcoin as the company was also structured as a limited liability company rather than the C Corp typical of startups where the people could invest with their money. With a gallery of around 30 people putting money in was a who’s who that came into play in addition to the original PayPal team as the Andreessen Horowitz co-founders were included in Angel List’s Naval Ravikant as well as the Winklevoss twins. Along with the group put in $ 5 million for the 21e6’s series A round closing shortly after Coinbase which was another Bitcoin company winning major press coverage for a similar-sized fundraising round. 

As for Srinivasan, a part of the goal in approaching individual investors was o sell tech leaders on Bitcoin getting them personally invested in the technology as he would later say that it worked. He says that they were pretty influential in getting many of the smart people in Silicon Valley taking Bitcoin seriously. Around five months after its series A the company plugged in its first machines and started mining bitcoins, as the company soon commanded 3 to 4 percent of all of the mining power worldwide as they said to the investors. That would yield about 150 bitcoins, a day at the normal rate of mining.

How Does The Procedure Help 21e6?

Subsequently, this activity coincided with the next big run-up in price as the people were sure as they bought Bitcoins for over$ 1000 as also again 21e6 struck with investors while they were hot. Later on, the company raised $ 25million from Andreessen Horowitz, the firm which was rather than the firm’s partners along with $ 10 million raised from 21e6’s original investors and there was another $ 30 million that came in way of venture debt. Coinbase at the time had recently raised its own $ 25 million round from Andreessen Horowitz heralding as the best-funded Bitcoin company in the world even though it had less than half as much money as 21e6. 

Further on the 21e6 investment was attractive because venture capital firms generally felt that they couldn’t buy bitcoins directly as 21e6, on the other hand, offered to pay its investors back with Bitcoin dividends allowing the firm to get bitcoins without buying them outright as the Andreessen Horowitz was also recruiting Srinivasan to join as a partner which he did at almost the same time as the investment.

A growing army of 21e6 machines was rolled out in early 2104 first filling up 24 racks in a data center and then 124 racks where soon in centers they were dedicated to the mission as the company spent lots of time figuring out a way to submerge the machines in mineral oil as a way to cool them and cut down on the cost of air conditioning and fans. Though by the middle of 2014, it was clear that a lot of people had invested a lot of money designing new mining chips back when the price of a Bitcoin had been near $ 1000 and the collapse of the Bitcoin exchange., MT. Gox the price had fallen to half that. Together with these many ambitious companies like Hashfast and Cointerra, were started by high-level engineers nearing bankruptcy.

Why Is 21e6 Counted To Be The Promise Of The Future? 

While it was seen that this didn’t stop 21e6 as it rolled out its second-generation chips. It was known as Gandalf already working on a third-generation chip, Yoda as the data center could nearly hold 10,000 machines with these chips with the epicenter of mining increasingly moving towards China and the chips were nearly free and cost of electricity often the most expensive cost for Bitcoin miners as close to zero if the miner was observed to be close with a local authority as also of someone at a power plant. 

It has been a trend that nowadays most mining experts assume that over half of all bitcoins were mined in China as Srinivasan’s company has not stopped mining and he says that ultimately the company has paid back all of its investors when the company’s latest fundraising round was announced with no mention being made of the massive data centers or mineral oil immersion.

The Final Words On The Topic

As Srinivasan’s company is taking on the competitors, the procedure followed is different and the data centers and oil immersion are stories of the past with a surge in the growth of technology. There is more to watch and so stay tuned. 

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