Canaan Enters into Partnership to Expand Cryptocurrency Mining
Canaan Inc. is a leading high-performance computing service provider with a large footprint in the cryptocurrency ecosystem. Canaan has announced that its wholly owned subsidiary, Beet Digital, has partnered with Luna Squares Texas LLC. It will be through a strategic joint mining agreement.
About the Collaboration
Canaan Inc. has entered into an agreement with Luna Squares Texas, which is a Bitcoin mining company in West Texas. The aim of the new partnership is to expand mining operations at Luna Squares’ mining site in West Texas. This agreement will help Canaan reach their goal of achieving 10 exahash per second (EH/s) capacity within the North American region by the middle of 2025.
The agreement allocates a certain percentage of the overall revenue to both the parties. The revenue which will be realized through Canaan’s Avalon A14 will be divided equally between the two parties. They will also use this revenue to meet costs associated with electricity usage, maintenance, and operating costs.
The two parties will share the revenue that Avalon 15 will generate with a 7:3 ratio. Canaan will get a higher share to help them recuperate their initial capital investments.
“The recent expansion of our self-mining activities across Texas and Pennsylvania underscores our commitment to strengthening our mining presence in North America. We believe that our collaborations with North American mining operators will foster mutually beneficial relationships and contribute to industry stability,” said Nangeng Zhang, CEO of Canaan.
“As part of our recent $50 million preferred shares financing, Canaan has committed to deploying the funds into digital mining sites and equipment across North America. In the two subsequent months, we have made great progress toward that commitment, securing significant orders from CleanSpark and HIVE, launching a 30 megawatt (MW) joint mining initiative with LS Texas in Texas, and upgrading our fleet operated by Stronghold in Pennsylvania. These efforts mark a promising beginning toward our expansion goal of 10 EH/s capacity in North America.“
Impact on the Crypto Industry
Growing Cryptocurrency Mining Operations
One of the bottleneck’s being faced by the cryptocurrency industry is the need to mine the cryptocurrency. Lots of resources are required to mine cryptocurrency which includes electricity, computing power, as well as technical expertise. This new partnership signals an increase in the total mining capacity in the world which will the industry move forward.
More Efficient Business Models for Cryptocurrency Mining
Most mining companies work independently. But, this new partnership shows that collaboration can be used to unlock synergies that can make the two companies achieve greater efficiencies than they could have on their own.
About Canaan Inc.
Canaan Inc. is a technology company. The company is primarily deal with software services, chip research and development, high-performance computer chip design, and more.
Summing Up
Overall, it’s heartening to see an increasing number of companies take part in the cryptocurrency mining industry. While the industry has been around for a few decades, it still is a nascent industry with lots of growth ahead of it.
