Looking at bitcoin mining under the surface

Bitmain Antminer S19j Pros submersed in fluids that continuously remove heat. Each tank has its own arrangement of machines that best maximize cooling. Photo: Brady Dale / Axios.

The first thing you notice about CleanSpark's new 20 megawatt immersion mining facility in Norcross, Georgia: It is not loud.

Why it matters: Noise is just one of the many complaints communities have had about bitcoin miners. CleanSpark, a Las Vegas-based energy company turned bitcoin miner, invited press to its new facility last week in order to show it's operating in the open.

Of note: Outsiders don't get to see inside bitcoin mining facilities very often. This reporter has been covering crypto full time since 2017, but this was his first time inside one, see below:

Background: Bitcoin is the world's oldest cryptocurrency. It guarantees that a single bitcoin can't be spent more than once using a system called "proof-of-work," which basically makes it too expensive to publish a phony transaction.

What they're saying: "Bitcoin has historically had a bit of a negative connotation," Chairman S. Matthew Schultz acknowledged at the event, whose purpose was to try to show how his company was taking a community-friendly approach.

Be smart: This is not your normal bitcoin mining facility, though there's a decent chance that more and more will look like this going forward.

CleanSpark believes that this approach will have other advantages, such as using less energy for cooling and longer life for their machines. Schultz said they hope to get seven years out of the machines seen here, though the normal life is five.

How it works: These are S19j Pro machines from Bitmain. They are built to be air cooled with built in fans. CleanSpark strips off the fans and replaces the firmware with its own.

Energy consumption is another hot topic in mining.

Driving the news: CleanSpark did a ribbon cutting with local dignitaries, in part to show that the company had met with community leaders before setting up shop. Here are some benefits to the community they touted at the ribbon cutting:

By the numbers: Across all of its facilities, CleanSpark had mined 3,768 BTC over the life of the firm, though Q3 2022.

This approach has allowed it to pick up more mining machines at a discount through the bear market.

The bottom line: CleanSpark has been an energy company since 1987. It got into bitcoin as energy entrepreneurs learning about bitcoin, not bitcoin entrepreneurs learning about energy.