Sazmining Podcast Episode 3: Sergii Gerasymovych on Bitcoin's Future and Mining Infrastructure

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Synopsis:

In Episode 3 of the Sazmining Podcast, Will speaks with Sergii Gerasymovych, CEO of EZ Blockchain. They discuss how EZ Blockchain uses digital mining and high-density computing as a physical tool to solve global waste energy and electrical load imbalance, as well as related topics.

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Will Szamosszegi (00:04):

Welcome to the SA mining podcast at SaaS mining, we are bringing you into conversations with today's industry leaders and blockchain and cryptocurrency. Our goal with this podcast is to improve the understanding and adoption of blockchain and cryptocurrency by giving you an insider's look at what's being built and informed predictions on what the future holds.

Sergii Gerasymovych (00:25):

William Simi is the CEO and founder of SA mining, Inc. All opinions expressed by William or his Gus on this podcast are solely their opinions and do not reflect the opinions of SA mining. You should not treat any opinion expressed by William as a specific recommendation to make a particular investment or follow a particular strategy, but only as an expression of his opinion, this podcast is for informational purposes. Only

Will Szamosszegi (00:53):

Today's episode is sponsored by block by and cogent law group. Our listeners can visit block by.com/sa mining for an exclusive offer for cryptocurrency management and check out cogent law group for all your legal needs.

Will Szamosszegi (01:13):

And my guest today started his first company when he was only 20 years old. He is the previous co-founder and chief operating officer of empire business translations. A few years ago, he jumped into blockchain and today he is the founder and CEO of easy blockchain, a Chicago based blockchain infrastructure company that designs builds, manages everything along the life cycle for physical infrastructure, for proof of work blockchains, easy blockchain uses digital asset mining and high density computing as a physical tool to solve global waste energy, such as flare gas, stranded energy, electrical load imbalance, and more so without further ado, I'd like to introduce you all to Sergi. Uh, thank you for being on the podcast with us today.

Speaker 3 (01:57):

Uh, thank you for having me.

Will Szamosszegi (01:59):

Yeah, definitely. So my initial question after going through that whole background is what led you to create easy blockchain?

Speaker 3 (02:09):

You know what, um, that happened actually by really a coincidence. Um, me and my partner at that time who we founded this company together, actually, uh, we were doing some important expert business and we had an opportunity to sell, um, computer hardware and there was a huge demand on GPUs. Uh, so we actually, uh, wanted to take a look deeper in what's going on in this market. And that's how I figure out that there is a huge, um, mining industry going on, uh, in the beginning of 2017 and two 16. Uh, so we wanted actually to try this out and that's when I actually learned more about what the future of blockchain gonna be and future of finance gonna be. And I could see how technology can actually be implemented technically in any industry. Uh, but mining was very hot at that time and we wanna try it out, you know, um, I always wanted to be in the industry with just starting off because usually I was late in every industry in my previous businesses and I wanted something new, something which has a lot of risk, but has a lot of potential in the future.

Speaker 3 (03:22):

So that's, uh, basically how we got to easy blockchain where we are.

Will Szamosszegi (03:26):

Yeah, well going in those early stages of growing a company, you're multiple time founder, uh, growing a company is one of the hardest things to do. So yeah, in those early stages of easy blockchain, how did you break into the industry and start seeing that initial traction?

Speaker 3 (03:43):

Yeah, well look, uh, I could say, uh, the same words everyone says, it's because of the hard work and, uh, it's actually true. It's because of hard work. We had to work very hard at that time. Everything was new and quick. Uh, so I think the big, uh, um, and main step that I took with my partner at that time was actually hiring the right people, the first employees. And that helped us a lot because when it's just me and him and we just doing everything, uh, that would not lead to any anywhere. So we had to hire a couple of people and those people actually helped a lot. Um, you know, they technically took off a chunk of our founding work. We had to partner doing some favors. They do us favors, you know, when you don't have, um, much money to spend. So you have to like do like Barker business a little bit. So you, you just don't live, uh, try as disservice. We pay you back at some time or you can, okay. You can push your mining equipment into our colocation services where you discover things like that. Yeah. So working hard and finding the ways out, being out your comfort zone was actually, um, most important part of that time.

Will Szamosszegi (04:56):

Yeah. And so diving into easy blockchain, the core of your business is you're working with these different proof of work systems. So just diving into the concept of proof of work. Could you explain what exactly that is and how it relates to your business?

Speaker 3 (05:11):

Yeah. Proof of work. Uh, that's well, traditional, it's an consensus algorithm on, uh, some of the blockchains such as B point and Ethereum, and what's different about this algorithm is that it requires actual physical equipment to do some type, uh, computational work in order to, uh, confirm the transaction, uh, to currency. That's actually the proof of work when a computer does some type of work.

Will Szamosszegi (05:37):

Yeah. And what you're doing with easy blockchain, how are you utilizing proof of work?

Speaker 3 (05:43):

So our, our whole, uh, business, uh, is very much, uh, um, uh, looking into B point blockchain. That's what our whole focus is. Blockchain B point blockchain requires a lot of, uh, mining infrastructure to be done. And, uh, meaning that you have to build motivate data centers, you have to install equipment, you have to provide power in order to keep those equipment actually doing that proof of work. So, uh, people, um, they believe that crypto RNC mining is something, you know, out of thin air, but actually requires a lot of infrastructure behind. So in order to make those machines, those computers run, we need to build the physical infrastructure behind it. So that's what we do. Actually, we build the physical infrastructure, we build mining farms, we build mobile mining farms, we install miners, we service miners. We do everything that has to be done with mins.

Will Szamosszegi (06:43):

Yeah, definitely. And so just to, to summarize your companies in the business of building the physical infrastructure, setting up, whether it be a data center or a custom type of shipping container design, where you put the computational resources inside and start processing data for proof of work systems like Bitcoin Ethereum,

Speaker 3 (07:05):

That is correct. Yes. And we do mine, uh, Bitcoin for our own proprietary mining that we do that too.

Will Szamosszegi (07:11):

Yeah. So diving into your actual mining operations, are you doing, uh, like traditional air based systems or are you doing air based in shipping containers or how do you guys go about building that infrastructure?

Speaker 3 (07:27):

Right. So in 2017, when we just started, we did use the shipping containers, but we found those structures, uh, not, uh, very versatile in the hot climates. Um, we actually, we had the HVAC system all there, but, you know, during, uh, the hot days in summer, the containers they get, uh, very hot because of the direct sun. Uh, it's not only because of the hot air insight. So that led us to actually building, um, mobile data center from scratch, using some different type of material that, uh, steel. So we were, we started using, um, the sandwich panel sandwich panel. That's like two thing, layers of aluminum with the foam inside of it. So that helped us actually to reduce the heat of the box itself because of the sun. And we do use the HVAC system, um, have HX system that sucks out the air.

Speaker 3 (08:26):

We have, uh, uh, great engineers that actually calculate how much air has to be, uh, taken out of the box. We use, um, we use a lot of Schneider electric equipment and we work with their, uh, calculation system. So it helps us actually to understand how much air has to be out. Cause this question is being asked every time when we talk to our customer who has no experience in cryptocurrency mining, they get to us is like, oh, what's how is it cold will be enough air, um, air circulation there, you know, they will, will there be a air conditioning. So things like that. And, um, because of our material, our mobile data center, we call it smart box, uh, is actually a totally different product on the market. Uh, we do have some lower end model, like easy tank. We call it, that's a container, uh, it's like on a cheaper site, but if you will building a larger infrastructure, uh, in some warmer climates and now, you know, it's everywhere here in Illinois, it's, it's also very warm during the summer. You'd better go with our smart box. Smart is much better, uh, in the hot airs as well as actually in cold because it's, uh, um, the material which we use in it, uh, is actually used to, to build, um, the refrigeration rooms. So that's where the air doesn't come out and doesn't come in. So it's like very stable temperature inside.

Will Szamosszegi (09:50):

Yeah. Well it definitely, there's definitely a lot of different, uh, considerations that you have to take into account when building these different types of systems. Yeah. It seems like you guys have your own type of design that you are going out and you're providing to the market. So when you're going in doing that whole process of trying to find new customers or trying and find people to, uh, purchase or utilize your services, uh, how does that conversation normally go? Because it really does, uh, get into a lot of, uh, very technical and, uh, you know, certain concepts that people outside the industry might not necessarily be familiar with.

Speaker 3 (10:31):

Yes. Look, we, uh, from the time we started, as I said, 2017, we have developed multiple questionnaires, like FAQ questions, uh, that we've sent to our, uh, customers or potential customers to actually answer them so we can understand, uh, what their needs are. And, uh, usually the questions are the same on their end. Like what's, uh, how, how is it good in the hot environ and how many minors you could fit in, how many kilowatts you could fit in? And we have all those answers, um, usually, uh, before we actually start any work. Um, so, uh, but usually our box is built to order. So the customer comes over, uh, he or she asked what they really need. What's the scale of the project. What's the timeline of the project. When we start building out, we do have an engineering team that works for us full time.

Speaker 3 (11:27):

Um, that designs everything from literally from scratch. So if you come over and say, I need, uh, smart box or any other type unit for this type of a budget, and I don't wanna use, um, copper, uh, in my box, I would use aluminum, uh, because it's cheaper and I'm happy to take it at risk. We'll do it for you. So our boxes are not really on, uh, on like off shelf product. Uh, it's actually built to order. We do have some specific design that we play with. Uh, but, uh, we can always like change something, but usually, uh, most of the customers are happy. Uh, and, uh, we have some concerns, uh, in the process of selling the product only when the customers are not experienced and they believe they won that they can mine Bitcoin for very small, uh, investment. And they, you know, when you tell them that the box costs, you know, a hundred thousand dollars, like, okay, I'm probably gonna this time.

Will Szamosszegi (12:29):

Yeah. Yeah. So are, are you seeing that your clients are, what sort of size are your traditional type of clients then for these, for these, uh, products?

Speaker 3 (12:39):

Yeah. Well, so the market has shifted, uh, obviously, I mean, with the price of Bitcoin, uh, going down in the last couple of years and then, you know, bouncing back, uh, the market has shifted from, uh, like retail customer who was just mining, uh, in his or her basement to actually more institutional clients. And, uh, now we, we mostly work with institution clients who would start from one to two megawatts to start with, uh, to, uh, build the farm. So, um, usually it's either, uh, some family offices or, uh, some type of accredited investors who want to diversify using cryptocurrency money. But a couple of years ago it were only retail, uh, people who just wanted to have a passive income right now, the passive income really is not possible if you don't have a cheap power or very low power, which requires a lot of research and investment, uh, at the end of the day.

Speaker 3 (13:41):

Um, so now it's more institutional and I believe it's gonna be like even more institutionalized, uh, uh, in the nearest future. Uh, so I believe it's gonna be bigger funds and there will be more like financial products built on this, cuz now it's still, um, buying equipment, buying mobile data center and putting somewhere with a cheap power. And that's a hard process, like average lead time. Let's say we have haul again in four years. So, uh, you know, if you get a close two clients, uh, I mean lead time's in six months, it's not gonna be so much time for us actually to fill out the pipeline. So that means that more companies have to be focused on building some financial products. Some, uh, right now there are some type of, um, it called, uh, hash rate products. They sell hash rate or that's, I believe it's a good, uh, good product to start with when you can actually redirect hash rate and just sell it or, uh, just share it with some other customers. Cause it makes things easier. Uh, the client comes and say, okay, I have a hundred thousand dollars, a new end dollars. And I want to mine for half a year or three months. Here you go. I wanna get started tomorrow. Right. That's the easiest part. So I believe that has more potential to grow. It's a huge market.

Will Szamosszegi (14:59):

Yeah, definitely. And you, I actually touched on a really interesting topic, uh, which is this, this hash rate, um, hash rate futures. And then there are other types of financial products that weren't previously available in terms of just traditional options and futures on Bitcoin. And I'm wondering from your perspective, is this something that you guys are actively doing today because with, with client sizes of maybe one to two megawatts, that that seems like it might be a little bit small to be able to move and start placing bets for hedging on options and futures. Yes. Or is that something that you are looking at and evaluating for later on down the road?

Speaker 3 (15:41):

Look, uh, honestly we are not big, uh, um, clients of hash rate selling companies yet, uh, because of those reasons that are smaller. We, we are not huge mining, uh, company. First of all, we are focused a lot on infrastructure and we do have some own mining. Um, but you know, we are not the guys who are gonna tell you, we have a hundred megawatts or hundred 50 megawatts. Like there are a bunch of people like that, but, uh, even with the small volumes, there are a bunch of different services specifically in lending area where you can hedge against the price of Bitcoin going down. So meaning the hash rate swaps are still, um, in my opinion, too early. Uh, but in terms of actually, uh, hatching against the prices and not liquidating or Bitcoin would help lending products, I think it's, it's actually the market is there.

Speaker 3 (16:33):

Like we work for example, with a local company in Chicago, Drawbridge lending, they are doing great job. And, um, they have, uh, played with, uh, different models, how they can help you with that. So basically with the help of guys like that, you don't really need, uh, to worry about rate. If you buy minors for your own needs, you can actual hedge with them. Uh, but for the future in order to sell it, uh, to a larger audiences, uh, um, that's probably the only way is, uh, the contracts on hash rate. And, uh, look, there is no such a huge demand yet because, uh, that's, that has to be used only by any institutions who, who own Bitcoin. So they own Bitcoin and they buy hash rate contract to hedge against that. Then they buy options in future. So it's a bunch of different products in one basket.

Speaker 3 (17:29):

Like if you take a look at different outta commodity, like you, you might oil, for example, there are so many different ways to hedge against that, uh, or for that. Right? So, uh, I think in Bitcoin, the volumes are not there yet. Like once I was at the event where there was, uh, a, a Tom OV, he's a well known guy in Chicago who built the tasted tray. That's an option trading firm as well as educational firm. And that was like two years ago, three years ago. And a lot of people were hyped about the viewpoint at that time. And they asked someone asking question out of the audience, uh, do you do best speed point? Do you Tradepoint? And he was like, uh, you know, there's no liquidity for us. And I was like, okay, there's 30 billion of trading a day. There's no liquidity for these guys, what hell is going on? Right. Yeah. So, you know, we are not there yet. I believe in options market. There is no liquidity for the big guys yet at all.

Will Szamosszegi (18:27):

Yeah. So where do you see the industry moving these next four years? Because obviously we just had the, the previous having, you brought up that roughly every four years, there's another having that's going to occur, which changes the supply demand, economics of cryptocurrency mining for Bitcoin. So with all that said, where do you think Bitcoin is going to be? By the time we reach that next having, and what do you think is going to happen within the mining landscape in that time?

Speaker 3 (18:58):

So you mean industry Bitcoin in general or Bitcoin mining?

Will Szamosszegi (19:02):

Uh, both. Both. Yeah. I guess we can tackle one at a time. Whichever one you want to, whichever one you want to touch on first.

Speaker 3 (19:09):

Right. Look, uh, Bitcoin just popped a little bit, a couple of days ago and that's because of some news that they're gonna get custody. And then they're because some, um, some governing institution just said that Bitcoin is actually money. Uh, I think that we are lacking the, um, governing organization in the United States that actually can tell what Bitcoin is. Cause right now we have IRS that, uh, you know, considers Bitcoin, uh, a property. We have a fin send that considers uh, Bitcoin, uh, virtual currency. And then we have sec that considers everything, uh, a stock, a security, right? And we have CFTC that considers quite commodity. So too many, many people, too many minds. Right. So, and then someone else says it's the money. So I believe it's neither of those, or it's a combination of all of it. And that means that we need some separate, uh, governing institution, like cell governing institution, like C they're gonna be actually regulating cryptocurrencies because that's a huge market.

Speaker 3 (20:16):

So till, uh, I mean, till that that's gonna be a very hard journey, it's gonna be, again, a overall cluster, the price gonna go up. Then we will still see this articles that someone scams someone because of Bitcoin and they receive a end Suming Bitcoin. Cause right now it's still has a little bit of that bad taste, um, till we have that good taste and someone gonna say, okay, we're governing this thing. This thing is a digital asset, and this is how it's being governed till that, I don't think we're still gonna be, be like a, a settled industry, which is good because there is more, uh, room for new players. And as we can see, more and more players are getting in, in terms of mining in general, uh, that's a hard one because mining depends heavily on prices of electricity and heavily depends on the availability of the hardware.

Speaker 3 (21:10):

So, and you just mentioned about the second haul. So this is what's happening. We have seven nano chips right now just being introduced to the market. There's a huge demand on those chips, Intel even hasn't, uh, uh, made seven nano chips yet. And they have been, you know, one of the biggest chip makers in the world. So, uh, new apple products that we use use, uh, seven nano chips, then AMD cards use seven nano chips and then ASIC mins use seven nano chips. So it means that demand on those seven nanometer chips gonna be so high in the next couple of years, that they're gonna be no, not so, so much of an inventory of minors in general, which will, uh, create a huge demand, um, on minors. And, uh, the prices are then gonna be actually high as we can see right now, the S 17.

Speaker 3 (22:03):

So S nineteens, they don't go down in price, even though, you know what, they're not really profitable if you buy them, right. You know, you buy them and you have five, 7 cents electricity. Yeah. You could make some money, but that then cost $3,000. Like it's not what we've seen when there was, uh, 16 nano chips. If I'm not mistaken for S nine S those things could cost $1,000 one day. And then another day it could cost like $200 because the, um, cost to build S nine was very low right now to the cost to build S 17 or S 19 on 700 chips is very high. So we have that problem right now, going on, uh, till the next haul. Second one, the electricity, uh, costs is, uh, you know, there, there some capacity of cheap electricity. And that capacity I think is already filled.

Speaker 3 (22:52):

Like there are not that many hydropower power plants. There are not that many, uh, other sources that provide you very cheap power, probably like in Canada and the United States, there are still some left, but it requires a lot of investment into the infrastructure to, to get that cheap electricity. So I believe we're also at, uh, going close to the capacity over there. So what it tells me right now that the market cryptocurrency market, uh, the curve actually gonna flatter here, we're not gonna be growing anymore. Like this it's actually gonna be already more like flattered because we had capacity everywhere

Will Szamosszegi (23:26):

For the difficulty. You think it's gonna go more flat?

Speaker 3 (23:29):

I believe so. I believe so. I think they're gonna be couple of spikes this fall, uh, because of the deliveries of S nineteens and, uh, most of the deliveries in October, November, and after that, I don't believe we're gonna have huge spikes anymore because huge spikes can happen only with availability of hardware. And what I just mentioned, I don't think they're gonna be huge availability and look another risk. We have all this, uh, uh, situations with suppliers, uh, from China who cannot ship minors over here for, uh, what they could before, because of the tariffs. So we have another risk over here, and I mean, believe it or not, I I'm sure that United States gonna be in place for crypto mining because I I'm more than 75% sure, uh, that, that self governing institution than gonna govern the cryptocurrency gonna be created here first, uh, because United States has been always the center of, uh, financial markets.

Speaker 3 (24:31):

And I don't think that, uh, those plays out there, players out there who in financial markets are gonna miss this opportunity. I think they're gonna regulate it as soon as they could. And the reason we don't have it yet, because it's still a small market. And when the lobby is gonna get into the game, I'm sure we're gonna have something going. So this four years is gonna be very interesting. And I think after the next Halloween, what we're gonna see, uh, would be the same as we can see with gold right now, the margins are very thin. There are not many players in the gold market. And, uh, the gold is almost like supply of gold is almost, uh, finished. So that's, that's why it's just, you know, it's very flat. Uh, I mean, it's not flattering right now. The gold went up, but because not, not of the demand reasons because they, uh, well, there are demand reasons for that, but because of the market, but in general, gold was, you know, very, um, on a same level for quite some time plus, or minus couple percent, but Bitcoin is just going crazy. You can go like 40% one day, oh, we went, it's 40% one day. So I doubt that they're gonna be huge developments because the infrastructure costs to get into cryptocurrency mining right now is insane. It's in millions of dollars and not that many people want to risk it. And those who actually can risk that money are already, and not the newbies. They actually know how to measure their risks.

Will Szamosszegi (25:58):

Yeah. Well, that's interesting. You touched on a lot of things there, uh, going back to the regulation side, which all of everything ties back into, uh, the piece of news, I think you were referring to which huge piece of news is that the person who was appointed the head of the OCC within America, uh, he, he was previously at Coinbase. So many people are looking at this piece of news and seeing, wow, we have a bit coiner, uh, as heading the OCC, which is almost giving in a sense, the green light to all of these financial institutions to really dive in and, uh, really just adds that extra level of legitimacy to the space. So with that, uh, there are a lot of things that could play out. As you mentioned, within mining and you compared it to the gold industry and how gold has continued, uh, to progress and how the margins have become more thin. So with that said, uh, moving into the future with crypto, you mentioned that there are only a handful of players in gold mining today, and there are thinner margins. Do you think that the same thing is going to happen within crypto? Or if it's not, if you'd think it's gonna be different, how do you think that it's going to look and progress to that?

Speaker 3 (27:17):

I think there will be, um, not that many players that's yeah. That's my opinion for now, at least, uh, because again, of infrastructure cost, because some people are much, uh, uh, longer in this business than others. And as I said, the reason I was so happy to start this business was because I was actually at the beginning and now it's not the beginning anymore. It's already like, you know, couple yards forward. So

Will Szamosszegi (27:47):

<laugh> still chapter two, like very early, very early. Yeah,

Speaker 3 (27:50):

I agree. I agree. It's still early, but the, uh, entry point is already, uh, the, the scale, uh, that you have to entry is high. It's not something that you can start with couple miners at home because literally right now you cannot, before you could, but right now at 10, 12 cents at home, you cannot start this, even if you have S 19, uh, because that wouldn't make sense. So I believe they're gonna be like from infrastructure perspective, there will be more big players, but in terms of, uh, actually adoption of the industry, uh, I mean, they're gonna be not more, uh, more big players. They're gonna be a, a handful of players, big players who will have infrastructure ready, but, uh, they're gonna be more people, uh, who would want to have a piss of it. So will have either a like, like some mutual funds or ETF.

Speaker 3 (28:45):

I don't wanna speculate on ETF, but there're gonna be some other type of products where I, you, anyone else out from the street would be able to participate in mining. Like you would just have, you know, that passive income, but not investing in their equipment. So you would just put some money on their, uh, on the website and it will give you some returns depends on depending on the market. So infrastructure wise people will be, uh, uh, I mean, building bigger guides will become bigger. Uh, smaller guys will not get there, but there will be more, uh, exposure mining exposure to the, to the general hub.

Will Szamosszegi (29:22):

I'm sure. Very interesting. And so you touched on another interesting aspect there in regards to, uh, the understanding of the technology and, uh, how it particularly is applied to in this case, what we've been talking a lot about Bitcoin, but let's say that you're talking with someone who's outside the industry doesn't necessarily have a deep understanding of Bitcoin or blockchain if they come to you and they say, Bitcoin is a scam, and you have to convince them, uh, on the spot that it isn't a scam. What are you telling them?

Speaker 3 (29:58):

I'm telling that Bitcoin has been around for 10 years. Uh, the trading volume in Bitcoin is around 30 to 50 billion a day that there are Bitcoin futures, which are traded on CME group, which is one of the, um, most prestigious, uh, trading, um, platforms out there in the United States. Uh, then that IRS has added, uh, a question, do you own Bitcoin, or do you own cryptocurrency? And you have to report that. Uh, and I would tell them, um, that, uh, also that also, you know, it's worth, worth looking into this probably that's what I would tell them. Yeah. Because of those reasons

Will Szamosszegi (30:43):

<laugh>, well, hopefully they'd listen to you. <laugh>, it'd be a good decision on their part.

Speaker 3 (30:48):

Yeah.

Will Szamosszegi (30:49):

Interesting. So I know we just addressed, uh, if there's someone who doesn't believe in Bitcoin, what are you telling them? But there are many people who understand Bitcoin understand blockchain, but aren't necessarily in the weeds of the mining industry. Like we are, what would you say is the most common myth among those group of that group of people that understands blockchain understands Bitcoin. Uh, but they're not within the mining industry. What is the biggest myth that they traditionally have about mining that, uh, that you see today? And if you were speaking to someone, how would you debunk that myth right in front of them?

Speaker 3 (31:31):

Oh, that's a tough one again. Well, uh, <laugh>, I, I think, I think they're a couple, uh, first one, I probably touched a little bit that it's money of the thing, air that's, number one, the minor is printing money and just driving Lobos that's number one. <laugh> and, uh, that's that's for sure. And then another myth is that, uh, Bitcoin, uh, is, uh, is using more power than Ireland and it's bringing CO2 into the air and it's a huge disaster for the environment. It's the last nail into the coffin of our climate change problem. That's, that's what I've heard multiple times. I think those two things are, uh, a myths. Um, so the first one that Bitcoin is not a thing air that because you have invest to invest a lot of money to get one and to get one efficiently, uh, that requires a lot of infrastructure, a cost, uh, like data centers, equipment, uh, electricity cost, you know, contracts, much of those, uh, risks that you bear with that as well.

Speaker 3 (32:44):

Uh, so you are sometimes when you actually do the math, you're like, ah, you know, maybe I just better buy Bitcoin <laugh> or buy something else. Right. So that's one of the myths, um, probably that I believe, uh, I would, yeah. Would talk about the second one about CO2 is that Bitcoin is not using power. No, Bitcoin wouldn't be using power if it was not available. So that power is being generated anyway, um, that power is available out there. And, uh, most the general public doesn't realize that, uh, uh, power plant is on 24 7, but electricity is not used 24 7. It's used most from four to 7:00 PM. When people come back, uh, from work and actually turn on TV or do whatever some homework there. Right. Uh, so they don't realize this. So Bitcoin actually here is a, um, helps the environment because it actually balances the grid.

Speaker 3 (33:53):

So it helps power plants, uh, keep them running more efficiently, which means they have more money to invest into other type of technologies and other efficient technologies to make that power. So Bitcoin is a huge helper per se, uh, for this industry. And, uh, I can talk a lot about that because, uh, I mean, power generation in general is a very interesting thing and it doesn't consist of like one type of power, like coal or gas or, or something like that. It has multiple aspects of it. There are multiple intermediaries in, um, in the process to transport power from generation source to actually the user and Bitcoin sometimes, well in most cases actually helps to, uh, to reduce the fees. For example, uh, we, um, we, our company built the first location for our own needs in Indiana. And, um, that was a small, uh, co-op that we work with and we use 5% of their power.

Speaker 3 (35:04):

So because of what we use 5% of their power that they generate, uh, the prices, um, for general public, for people who have just small homes over there, uh, the prices on the electricity would not go up because this company, this car could buy more power is like in a wholesale manner, uh, which would bring the price down, wouldn't bring the prices up. So that was actually a good thing, even though, for example, it can play around in Washington state when it was actually vice versa, that Bitcoin is Bitcoiners were using too much power there. So they raised the price. So they actually, uh, they, they raised the price as a, as a regulation technique. That was, that was what it was. But in general, if it balanced well, it's totally a totally great thing. And specifically, for example, what we do as well, uh, besides the selling mobile data centers and building infrastructure, we are, uh, using Bitcoin, uh, mining equipment and mobile data center, actually to use a wasted energy like wasted gas and clear gas. And so,

Will Szamosszegi (36:15):

Yeah, and I'm actually, I'm really happy that you, you touched on this because that is definitely a big misconception outside the industry. And just to get at the heart of what you, you said at the end, uh, of, of that answer, you were actually going in and helping out that co-op because they're, they weren't utilizing their assets in the most efficient way possible that excess power you guys went in, took up that excess power, paying them additional money. And now that co-op has a better financial picture where they can pass some of that savings along to the people in that surrounding area, as well as you bringing and investing capital within that local, uh, that local area as well. So

Speaker 3 (36:57):

I, I don't even touch that. That's a huge aspect that <laugh> so much, so much addition to the economy in terms of spending for infrastructure costs, buying transformers, you know, investing cables, electrical contracts as local people. Yeah. It's, it's totally different topic. Of course. <laugh>

Will Szamosszegi (37:15):

Yeah. And that's, that's really great. Eight

Will Szamosszegi (37:20):

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Speaker 3 (38:55):

Oh, I think I should have prepared for that. Yeah. <laugh> so there, there are multiple books, but one of one book that I actually read and liked a lot that helped me actually just get into this business, uh, or to evaluate, uh, that I have to get into this business was the book called the quant. That's a book. Um, I think it's written by, um, one of the journals from wall street and it was about actually financial crisis in 2008, how a few hedge funds actually, uh, crashed the whole system, uh, building algorithms and trading and how they were packaging different financial products. It was a great book and actually talked a lot about, uh, um, the thinking of people who are behind those crazy trading, uh, strategies.

Will Szamosszegi (39:48):

Yeah, that sounds very interesting. What was the craziest thing that you learned when reading that book?

Speaker 3 (39:56):

Uh, well, the crazy, <laugh> the craziest thing where they, well, the craziest one of the, well, it's not the craziest, there's multiple things over there, but for example, one of the things that I learned there that one of the largest hedge fund is being, uh, run by like hundred people, but all of them haves and they, and they have like billions dollars under management, something like that. And then the craziest thing that, um, from my opinion that I got from this book, hedge fund managers, uh, looking into money a little bit differently than people from startup industries, uh, startup, I mean, tech industries, those people who are entrepreneurial, uh, usually think they wanna build something valuable and sell them, provide a service. And these guys, they just think about numbers for them. Of course, they do service for customers as well, managing money, but they have numbers. So numbers is the most important part. So, uh, their attitude to money is totally different and attitude to value is totally different. So it's not actually about value it's about them, those margins they can take on the trade. So

Will Szamosszegi (41:12):

<laugh>, yeah, again,

Speaker 3 (41:13):

That's my opinion from the book. Uh, it could be different. Another thing I learned, I think that's worth to say that one of the guys who set up a very, very big hedge fund, he was, um, uh, he was, uh, he was, uh, um, I think he was a, um, professor from MIT and he, uh, he went to Vegas and he played blackjack there. So he was winning blackjack all the time. Actually he is, uh, his character was depicted in the, uh, movie 21

Will Szamosszegi (41:49):

Great movie. Uh,

Speaker 3 (41:50):

Yeah, so that character, that's a real guy and he was depicted in 21, um, uh, movie. So he was playing in casino and it was not fun for him because he already calculated on the numbers. So what he said, I'm gonna go and set up a hedge fund and actually play in the biggest casino over the world. <laugh> so the, the great thing is that so trading and all this assets is actually a lot, looks like, uh, casino a lot.

Will Szamosszegi (42:19):

Yeah. Very interesting. Well, uh, the last question is where can everyone who's listening right now, connect with you online?

Speaker 3 (42:27):

Uh, I just started to, to support post some things on Twitter. Uh, so it's Serge, Guerra, uh, and, uh, LinkedIn, Serge Garris. Simovich, uh, you can find me there. Uh, I think if you Google easy blockchain, my, my name pops out there. <laugh> uh, and, uh, yeah, follow the company as well, easy blockchain, uh, on Twitter as well as in LinkedIn.

Will Szamosszegi (42:50):

Perfect. Well, thanks again for coming on.

Speaker 3 (42:53):

Thank you very much for having me. Yep. A pleasure.

Will Szamosszegi (42:57):

Thank you for listening to this episode of the SA mining podcast. Be sure to follow us on social media and YouTube for the latest updates and previews of upcoming episodes, full episodes and transcripts can be found on SaaS mining.com every Thursday. If you want to hear us interview a particular guest on a future episode, please reach out to us@podcastsamining.com.

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