Until a few years ago you could extract Bitcoin with a laptop. Today, the process is more like factory management: it requires specialized chips, hot and noisy mining rigs and enough electricity to power a small town.
That's why the arrival of a device called Coinmine One is intriguing. The creators of the device (pictured above), which sell for $ 799, offer it as an easy-to-use home extraction system that you can control with an app.
The device uses normal GPU chips and is not powerful enough to extract Bitcoins. At the moment, however, it can count on four other cryptocurrencies: Ethereum, Ethereum Classic, Monero and Z-Cash and has its own operating system that will allow owners to add other currencies in the future.
Coinmine was born from an idea of Farb Nivi, an entrepreneur who claims to have built computers since he was a child, and of the industrial designer Justin Lambert, who has helped a line of smart watches called Pebble. The company raised $ 2 million from leading names in the realm of cryptocurrencies, including Coinbase Ventures, Arrington Ventures and Coinbase CTO Balaji Srinivasan.
I wanted to see the mining device in action, so Nivi came from the Fortune office to provide a demo. He pulled a Coinmine One out of a big backpack, connected it to a wall and showed an app that shows how much cryptocurrency is extracting.
The most important features of Coinmine is that it is quiet and does not consume more electricity than a vacuum cleaner, according to Nivi. It also has an appealing design with an Apple-style aesthetic, which is a stark contrast to the clumsy devices normally used for extraction.
For aspiring miners, the device also requires a certain degree of trust: an owner must rely on Coinmine to collect the currency of the device. The company stores the output in its portfolios on its corporate servers, with a cut of five percent.
According to Nivi, the appeal of the device is twofold. First, it provides an easy way to earn cryptocurrency. Secondly, it provides that people will use it to enter the ground floor of new currencies that will arrive on the market as they will be able to extract them directly rather than buy them.
"With automatic updates, MineOS also allows access to new cryptographic networks like Bitcoin Lightning, Grin, Dfinity and Filecoin, which ensures that users do not lose control of the next major cryptographic network," said company in a version.
Nivi also thinks that other cryptocurrencies will follow the path of Monero, which now updates its protocol in order to hinder those who try to extract it with specialized ASIC chips. These chips, which today are essential for the extraction of Bitcoin, have a single purpose and are able to extract them much more efficiently than generic GPU chips.
So who will buy the device? Nivi says it will appeal to cryptocurrency enthusiasts who want to participate in new projects. Meanwhile, Srinivasan states that they also represent an opportunity to make money.
"It's an interesting idea to connect a device to the wall to make money while you sleep.As a purely economic proposition, you should balance the cost of the power and the hardware device itself with the cost of the coin or token that you should extract. There are so many resources now that it's probably always an arbitrage somewhere, "he said.