Dallas-based Applied Blockchain is moving forward with its first cryptocurrency mining deployment with the help of a purchase agreement with Sparkpool, the largest Ethereum mining pool in the world.
The agreement represents Applied Blockchain’s planned initial deployment of $5 million of mining hardware.
It’s a fast move, especially since Applied Blockchain just launched its business last month. CEO and Chairman Wes Cummins says this is the next step to signaling movement to deploy capital and scale crypto-mining operations.
Through the deal, Applied Blockchain will procure graphics processing units from technology company NVIDIA, inventor of the GPU, which creates interactive graphics on laptops, workstations, mobile devices, PCs, and more. That’s part of Applied Blockchain’s larger plan to scale an Ethereum and Altcoin mining operation.
Applied Blockchain notes that “GPUs’ power potential makes it more useful in blockchain mining than traditional CPU mining.” GPUs are faster and more efficient than CPUs, according to the company’s investor presentation in April. “GPU mining solves complex math problems to verify electronic transactions on a blockchain,” the company details.
GPU can also be used to mine other crypto networks such as Ethereum, Litecoin, Dogecoin, Filecoin, Ethereum Classic, Beam, and more.
In the next six to 12 months, the local company aims to be the leading publicly listed pure-play Ethereum/Altcoin miner. To do so, it’s securing strategic partnerships with two of the world’s largest and most experienced Ethereum companies. That’s where Sparkpool comes in.
SparkPool operates public chain networks through its global Ethereum mining pool. According to the company, it’s dedicated to optimizing technology, while providing safe and stable services for thousands of users every day. This leads to stable mining pool services and the fair allocation of rewards.
The investor presentation also showed that Applied Blockchain wants to leverage high-performing equipment and existing facilities to be energy-efficient with low-cost hydroelectricity and operationally efficient with the best mining software. The goal is to ensure 99 percent or more uptime and the highest mining rewards, along with supply chain and deployment expertise.
The mining assets, expected to be operational by mid-month, will be powered entirely by renewable energy. Mining will commence at an initial hash power that exceeds 200,000 MH/s, according to Applied Blockchain. The operation will also be located in North America.
The company wants to streamline the process from procurement with special vendor relationships.
“While initial operations will come online a few weeks later than originally planned, we felt it was essential to pivot our deployment in light of current market conditions,” Cummins said in a release. “Importantly, we are still scaling our operations with computing power that leverages low cost, clean power. After working out initial supply chain and deployment bottlenecks, the company will be in a position to rapidly scale hash power in the coming months.”
Applied Blockchain’s backing was led by institutional investors with gross proceeds of $16.5 million, before expenses. The company closed its PIPE financing transaction in April 2021.
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