At The Nexus Of Bitcoin And AI, This Vertically Integrated Miner Has Big News

Benzinga

Haris Basit, Chief Strategy Officer at Bitdeer, joined host, Zunaid Suleman on Benzinga's All Access.  Bitdeer is the industry’s only vertically integrated, technology-focused Bitcoin mining company. With the industry’s most experienced leadership team, Bitdeer has dedicated 25% of their workforce to research and development, underscoring a commitment to  unearthing strategic advantages through the creation of proprietary technologies and vertical integration.   The Company also offers advanced cloud computing capabilities to customers with high demand for machine learning and large language models. Bitdeer has unparalleled operational expertise in the field of bitcoin mining, with 895 MW of data center capacity strategically deployed across the United States, Norway, and Bhutan.

Transcript

00:00Harris, what is going on? How are you? It's good to be back.

00:07Hey, Zenaid. Things are great. How are you doing?

00:12I'm doing well. You know, every time I do this interview with you, I always remember

00:16the hair joke. I can't, you know, it's not the best clip for the interview, so I should

00:19keep it professional. But I want you to know I got a fresh cut just for this interview.

00:23All right, great. Glad to hear it. I got a fresh cut too.

00:27Steve, I wasn't going to say because I didn't want you to fire us, but you said it, not

00:30me. But look, you've got some exciting stuff to talk about, which I want to get to here

00:33with the Ohio land deal. But before that, for the folks at home that might not be familiar,

00:38tell us a little bit about your company.

00:41So Bitdeer is one of the largest Bitcoin mining companies in the world. We have a gigawatt

00:48of Bitcoin mining in place around the world. A lot of it is right now in the United States,

00:54Texas, Tennessee, Washington State, a bunch of new land that we have in Ohio with a power

01:01interconnect there. And we have large operations in Norway and Bhutan. And we have an AI data

01:07center in Singapore. But in addition to running Bitcoin mining operations, we have just started

01:16designing and building our own mining rigs. So we're designing the chips. We've just taped

01:22out the second set of chips. And so that's a big move for us, a big strategic move for

01:27us as well.

01:28Yeah. So let's talk about that Ohio land where you expanded your power capabilities as well.

01:34Give me insights on what that means or what it is rather and what that means for the company

01:39moving forward.

01:41So we have land in Ohio already that we announced several months ago. And that was about 200

01:47and I want to say, I mean, I get the exact number, 221 megawatts or something like that.

01:53And what we announced recently is that we have another close to 570 megawatts that we

02:00can turn on in two phases. First one is around 260. And then the second phase is the remainder

02:09of that. So, you know, Ohio is a great place to do Bitcoin mining. The power cost is low.

02:19You can, there's a lot of trading opportunities for energy to reduce power further. It's a

02:24very stable environment. It's also a great place for high performance computing and AI.

02:29And our sites have a tremendous amount of power, low cost, water, a lot of water available

02:37as well as fiber. And so we're actually in the process of doing, you know, sort of a

02:42worldwide analysis of all of our data centers to see how suitable any one of them are for

02:49use in high performance computing or AI data centers and how to prioritize that aspect

02:56versus what we're doing now. And just to repeat, we have a small AI data center that we're

03:01operating for the last nine, 10 months in Singapore.

03:08And you know, with AI obviously being the hot buzz word for like the past couple of

03:12years now, the AI chips, which have been in short supply for quite some time, and now

03:16you just need them not just for mining anymore, but for AI capability as well. So that seems

03:20to be a nice roadmap that you guys are building on the bullish sentiment of the land that

03:24you purchased there as well. Do you see any challenges ahead with, I mean, so much power

03:29being utilized, not just in the mining space, but also in the AI space, which is why you've

03:33obviously made this deal. But do you feel like you're going to need more?

03:38I mean, we're always looking for more power contracts, more land, but we're highly selective

03:44in how we choose that. You know, we want obviously the low cost power, dependable power, stable

03:50political climate, economic climate. And so, you know, there's a lot of places where you

03:55can get very cheap power, but the economy and the politics aren't very stable. So we

04:00just don't go there. And so we're very selective. I'm sure we'll add additional sites going

04:07forward. I'm sure we'll also grow our additional, our existing sites as well. But you know,

04:15it's sort of hard to predict exactly where that will be. I should point out that if you

04:18add up all our capacity today, it's two and a half gigawatts, which I think is probably

04:23the largest or the second largest among all Bitcoin mining companies. And that's worldwide,

04:29two and a half gigawatts.

04:30Now, that's definitely huge and gigantic. Now, 25% of your workforce, I believe is dedicated

04:35to R&D. What kind of improvements are you kind of hoping will come out of those efforts?

04:43Our targets are pretty extraordinary here. We are trying to revolutionize the design

04:49of chips, starting with Bitcoin chips. But there's this equation that has ruled over

04:56the power dissipation and the energy consumption of chips for the last 50 years, which is that

05:02the power is proportionate to the capacitance times the voltage squared times the frequency.

05:09And, you know, a lot of chip designers think of that as a law of physics. We are intending

05:14to make a chip that is way below that power so that what people think might be the theoretical

05:23minimum, we are planning on making something that's 75% less power hungry than that. And

05:29so we'll apply it to Bitcoin first, of course, because that's our bread and butter and that's

05:34what we know best. But it'll have applications outside of that. So we think that will be

05:39a big breakthrough. I'll be talking about that technology at the Nashville Bitcoin

05:45conference.

05:47Any more insights on your cloud competing, which, by the way, that national conference

05:51is going to have a lot of notable speakers here. So I'm excited to watch that part of

05:56the conversation as well. The cloud competing arm that's going to take off here in the AI

06:01space and already kind of has any plans for expansion here? And what does that look like?

06:06Well, we have, you know, expert consultants looking at this. These people have done dozens

06:12and dozens of data centers for hyperscalers, for large, you know, multinational companies

06:19and and, you know, people with very high demands for data centers. And so we've enrolled that

06:28level of expertise to, again, look at all of our sites and figure out where we should

06:35prioritize that effort. So we're still in the process of examining that internally and

06:41with outside consultants. And we will have announcements in the coming weeks and months

06:46about what the results of that analysis are.

06:52You had so many ETFs that were or that either you had the Bitcoin ETF, then you have like

06:56the conversations of the Ethereum ETF and now ETF and now even Solana ETF as well. Do

07:02you see this as like a positive thing for the crypto space? Because now the average

07:07show that might not know how to buy Bitcoin, but knows the financial markets can now get

07:12a piece of the action? Or is there a different story that folks might not be paying attention

07:17to that you feel like might be bullish here for crypto in general?

07:21It's hard for me to comment on Solana. I don't know enough about it, really. And it's

07:26very general. Yeah. Yeah. Ethereum, you know, I really think among those three Bitcoin stands

07:33out. And, you know, friends often ask me, friends and family for advice on this. And,

07:40you know, I'm certainly not one anyone should be taking financial advice from. But the advice

07:44I give is to stick with Bitcoin and it's just safe and it has the upside. And which I think

07:51is quite significant. The others, I'm sure, are have potentially upside, too. But, you

07:56know, there's more risk, more counterparty issues and things like that. And, you know,

08:03so there is a really great option in Bitcoin and I'm not sure it's worth diversifying out

08:07of that if you're going to be in crypto. I think you just put your all your bets on that

08:12horse and let it ride. I think that's quite safe and has a lot of upside. So that's that's

08:19my personal view on that. I don't really have a you know, I'm not really a financial

08:24person in that sense. And I wouldn't listen to myself. But that's that's what I've been

08:29doing. And I think it's good. I think ETFs for Bitcoin have been good. I think it does

08:34expand the market. I think if you want Bitcoin to be more widely used, the methods of using

08:41it, say using it for savings and other things have to be simplified. And ETF is one way

08:46of doing that. You know, I know some people have worries that it might undermine the nature

08:52of Bitcoin, but but that's I don't think that's going to happen. And I think the nature of

08:57something that is widely used is that a lot of people, in fact, maybe most people will

09:01use it in a way that at least the purists don't like.

09:05So what I'm hearing is when friends and family reach out to you and they say, hey, should

09:09I invest in Bitcoin? What's your price target in a year, five years, 10 years? You're like,

09:14figure it out, bro. But Bitcoin is the way to go. You have to give a price target. I'm

09:17always afraid of that when it comes to financial advice. I don't want to tell you where it's

09:20going to end up being, but I know I believe in the underlying, which in this case is crypto,

09:25which in this case is Bitcoin. Is there anything else that you wanted to cover here today that

09:30I didn't get a chance to bring up with what's going on with the company, where you're kind

09:33of headed, where we can expect maybe some milestones happening in the next six months,

09:37a year or two years? Any other topics that you wanted to talk about today?

09:41No, I mean, I think that we've covered it. I think, you know, if you look at the three

09:44main thrusts, we are one of the largest Bitcoin miners on earth today, and we're going to

09:49grow. We're going to grow dramatically over this next nine to 12 months. We're expanding

09:55into Bhutan, into Norway, into Ohio. And those will be very large expansions. We'll have

10:03announcements about what our new AI strategy is. And then, you know, the part that I'm

10:08most closely related to is the ASIC business. And that I think is going to be really a fundamental

10:13sea change in the ASIC technology that Bitcoin folks use. And I think Bitcoin in this case

10:20will have an impact on the larger chip design space and the huge amount of energy that other

10:27applications like AI are using. I think we can have a positive effect on that in reducing

10:33the total energy requirements for those applications as well. And for the folks that might not

10:41be familiar, I want them to kind of understand the ASIC side of the business. Can you briefly

10:45just explain what that is and how that works? Yeah, so ASIC means Application Specific IC,

10:52so it's just the chips. But in the Bitcoin community, people have used that word also

10:57to refer to the machine, the entire system that it is in. So this is how Bitcoin is mined.

11:03You turn one of these things on and it starts running the SHA-256 algorithm. And, you know,

11:09I won't go into the details of that. But so how energy efficient you can make those chips

11:16is everything, because most of the cost of mining a Bitcoin is the electricity that's

11:22used to run these machines. And so there's been, you know, in the initial years of Bitcoin

11:29going from, say, 2009 to 2012-13, there was a 5,000 times reduction in the energy required

11:37to operate this algorithm because people went from running software on a CPU to Application

11:44Specific ICs. Application Specific ICs started off in, say, the 2013 timeframe. And over

11:51the last 10 or 11 years, they've improved energy efficiency by a factor of 1,000. And

11:56now we're talking about going much further still. So that energy efficiency is really

12:03everything. And, you know, if you want to buy an ASIC, you'll buy one that can do far

12:08more with less power, because that's how you're going to make more money on that.

12:13Which is one of the reasons you saw college kids mining Bitcoin from their dorm rooms

12:17because they didn't have to pay for electricity, right? So many folks got in trouble for that.

12:21But awesome. Always a great pleasure, man. Thank you so much for joining us here today.

12:24I appreciate you.

12:25Yeah. Nice to talk again, Dinesh.

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