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What is AltMiner?
Features of AltMiner
- Cloud-based mining. AltMiner provided a cloud-based mining solution, eliminating the need for investors to set up and maintain physical mining hardware. This approach simplified the process and reduced operational complexities.
- Institutional focus. AltMiner was tailored specifically for international institutions and large investors, making it accessible to entities with substantial capital to invest in Bitcoin mining.
- Low relative cost. AltMiner aimed to offer high-quality miner exposure at a lower relative cost compared to retail-focused mining alternatives. This cost-effective approach made it appealing to institutional investors.
- Minimum buy-in. AltMiner products had a minimum buy-in requirement of $500,000, ensuring that participants were committed institutional investors.
- Two-year commitment. Each AltMiner product was sold as a two-year contractual commitment, providing investors with a longer-term exposure to Bitcoin mining.
- Daily Bitcoin payouts. Investors received daily payouts in Bitcoin, with the amount proportional to their hashrate and the hashrate of the entire Bitcoin Network. This provided a steady stream of Bitcoin income.
- Ownership of equipment. Altonomy owned the underlying mining equipment, relieving investors of the responsibility of equipment procurement, setup, and maintenance.
- Advanced technology. AltMiner was backed by sub-10 nanometer Bitcoin mining processors, leveraging advanced technology that was challenging to procure independently.
- Oversubscription. The first batch of AltMiner products quickly garnered substantial interest, with a hashrate capacity for $3 million. It was oversubscribed by more than 300%, highlighting the demand for such products.
- Additional capacity. In response to high demand, Altonomy announced a second batch of AltMiner with an estimated capacity for more than $10 million, demonstrating its scalability and potential to attract institutional investors.
AltMiner competitors
- Traditional mining operations. Institutional investors had the option to set up and operate their Bitcoin mining facilities or partner with established mining companies. However, this approach required significant capital investment, expertise in mining operations, and ongoing maintenance.
- Cloud mining services. Cloud mining providers, such as Genesis Mining and Hashflare, offered mining contracts to retail and institutional investors. These contracts allowed investors to purchase mining power from the provider's mining hardware. However, cloud mining contracts often faced scrutiny for their transparency and profitability.
- Bitcoin mining pools. Mining pools like F2Pool and Antpool allowed miners to combine their computing power and share rewards. Investors could join these pools or invest in shares of mining pool operations. However, this approach required active participation in pool management.
- Blockchain infrastructure providers. Companies like Bitmain and MicroBT manufactured mining hardware and sold it to both individual miners and institutional clients. Institutional investors could purchase mining equipment directly, but they would still need to handle setup and maintenance.
- Cryptocurrency investment funds. Institutional investors interested in exposure to Bitcoin and cryptocurrency assets could consider cryptocurrency investment funds and trusts, such as Grayscale's Bitcoin Trust (GBTC) or Galaxy Digital's Bitcoin Fund. These funds offered indirect exposure to Bitcoin's price movements without direct involvement in mining.
- Other mining projects. Various blockchain projects and startups aimed to improve the efficiency and sustainability of cryptocurrency mining. These projects introduced innovative mining technologies, renewable energy solutions, and decentralized mining protocols, potentially attracting institutional interest.
The bottom line
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