NEWS FILE PHOTO Jeff Mason, a Hut 8 director who oversaw construction of the company's data processing facility in Medicine Hat, shows off a portion of the facility's control room that monitors power use high enough to power about half the homes in the city.
Medicine Hat News
Bitcoin miner Hut 8 has a physical presence in Medicine Hat, but the idea of buying a digital currency, or how money not backed by a national government even works, is still mysterious, according to the company’s CEO.
Andrew Kiguel adds however, that as its use becomes more common it will be more acceptable, and his firm is positive about its long-term prospects.
“For a lot of people it’s a leap of faith,” said Kiguel, the head of Hut 8, who spoke to city and local business leaders at a breakfast presentation before Friday’s ribbon cutting at the local “crypto-mine.”
“We wanted people to have direct access to invest in Bitcoin though Hut 8, which is a publicly traded company,” said Kiguel.
“One of the reasons the City of Medicine Hat wanted to deal with us (in a power supply and land agreement) is that we can show them a balance sheet.
“A lot of companies are promising dreams.”
Bitcoin and other crypto currency are used as a form of payment between an immensely long and complex string of computer code that acts as its own accounting ledger, which, proponents claim, make it impossible to duplicate or counterfeit.
Miners earn a fee when they certify transactions between parties who agree to swap Bitcoin, either as an investment or for sales of goods.
Miners are paid in Bitcoin, and since Hut 8 began operations, it has mined, or earned, 3,300 units of the digital currency, worth about C$30 million.
Most of that has been accomplished since July when Medicine Hat went into full operations, but the exchange rate is down about two-thirds of its value since a meteoric rise to about $20,000 each last December.
That volatility doesn’t affect Hut 8’s business model, said Kiguel, and they mostly hold what they earn.
“We think that as the Bitcoin industry evolves it will become more stable,” said Kiguel, stating that could be helped if a major bank or financial institution, like an investment firm,
“Once that’s in place it will create a space for large investment companies.”
Scholarship
Officials with Hut 8 took the opportunity at their grand opening on Friday to announce they would donate $20,000 over two years for scholarships for students in financial need at Medicine Hat College.
The institutions vice-president Wayne Resch was on hand to accept the funds and also said college is also in early discussions about how the company could be involved in programming
“It’s about getting students interested in the technology,” said Resch.
