Northern Bitcoin AG merges with Whinstone US, plans mining facility in Texas

Frankfurt, Germany-based Northern Bitcoin AG announced yesterday in a press release that it is partnering with its US-based competitor Whinstone US, Inc to build a a new Bitcoin mining facility in Texas. The companies say that this facility will be “by far the largest Bitcoin Mining Facility worldwide”…

The company says (full press release embedded below) that it plans to build the massive facility over the course of three phases. The first phase has apparently already commenced as of a few weeks ago:

A few weeks ago, the company started building its latest site in Texas. On an area of 100 acres (equivalent to around 57 soccer fields), the largest data center in North America and the largest Bitcoin mining facility in the world are built in three phases with local construction partners.

The company’s schedule for the rollout of the facility is insanely fast, with the first phase set to bring 300 megawatts of power online within a few short months from now:

With the completion of the first construction phase planned for the first quarter of 2020, the company will already have over 300 megawatts of capacity and will rank number one worldwide. The total capacity of one gigawatt is expected to be available in the fourth quarter of 2020.

Why is Whinstone building a Bitcoin mining facility in Texas?

The US-based Whinstone already has a facility in Louisiana, which is a mystery enough to me, but my big question is this: What about Texas makes it an attractive destination for Bitcoin mining? These two newly-merged companies are not the first mining organizations with sights set on Texas.

As Decrypt notes, Bitmain, a much more established name in the Bitcoin mining space, recently announced a huge Texas mining farm in Texas as well. Just weeks ago, actually…

And if all that sounds vaguely familiar, it’s likely because the world’s leading Bitcoin mining firm—the China-based Bitmain—just weeks ago announced it was finally ready to open up its very own Texas mining farm in Rockdale.

Which begs the question above. Aren’t dry, year-round cool climates the best for Bitcoin (or any cryptocurrency) mining operation? One of the most challenging aspects of running mining systems profitably is cooling, and Texas’ year-round heat likely won’t do either of these companies any favors in that regard.

The only reasons I can think that Texas would be attractive for mining operations such as these would be a good mix of affordable (but not cheap) land and green, renewable energy. West Texas is known for its wind farms, so perhaps there is a connection there. I’m lost on Bitmain’s decision to go with Rockdale… it’s very southern, hot climate, not-so-flat land that probably wan’t cheap.

Where will the Northern/Whinstone Bitcoin facility be in Texas?

And so the second question I have regarding this particular Northern Bitcoin AG and Whinstone deal is where exactly in Texas this new facility will be. Apparently, ground has already been broken. Wherever it is, the company is clearly fast-tracking its development and already has major customers on board…

The total capacity of one gigawatt is expected to be available in the fourth quarter of 2020. The first customers of the new site are two stock-listed corporations that will use a significant portion of the capacity for Bitcoin mining.

Let us know in the comments what you think about these developments, particularly the new Northern Bitcoin AG and Whinstone facility that is to be located in who-knows-where, Texas…