Big cryptocurrency mining outfits face exorbitant electric bills every month as a result of massive power consumption by banks of computers processing complex algorithms to add data to blockchains.
In fact, it's the single biggest monthly expense that can ring in for some in the seven-figure range depending on power rates and number of rigs running.
Bitcoin mining host DMG Blockchain Solutions Inc. (TSX-V:DMGI) said Thursday morning that it is teaming up with electrical engineering and construction firm Primary Engineering and Construction to study ways to improve power quality for crypto mining.
The joint effort comes on the heels of news last week that DMG partnered with D-Link for switching and routing for DMG's crypto mining operations. In short, DMG is leveraging the expertise of others to maximize infrastructure efficiencies in a bid to maximize profits. Given the newness of large-scale crypto mining, there has been little research done to fine tune the process, something DMG is assuming a lead role in doing.
Phase 1 of the work the PE&C is already complete and will serve as key inputs for the system impact study conducted by a local grid operator. Phase 2 will expand the sample size from the original test system to a larger production system, leading to optimizing the power system design specific to crypto mining by measuring energy consumption, peak kilowatt demand, power factor and system harmonics.
"[W]ith Primary’s insight, DMG’s current facility (designed for up to 85 megawatts) will benefit from this information as well as the upcoming plans for DMG’s next build-outs, which are in the 100s of megawatts," said DMG COO Sheldon Bennett in today's announcement.
Cryptocurrency and blockchain related stocks have been facing headwinds lately due to some negative press with countries like China and South Korea calling for bans on cryptocurrency activities, resulting in a drop in cryptocurrencies and associated companies across the board. DMG has not been immune, slicing from a high near $2 when it began trading last month to as low as 86 cents on Wednesday.
With the news, shares have perked up modestly by one cent (+1.1%) to $0.91 on Thursday as of about 1:30 p.m. Toronto time.
