MGT Capital Investments, Inc. (OTCMKTS: MGTI) ranks as one of the largest U.S. based Bitcoin miners.

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Bitcoin prices reached their peak around the beginning of this month at just a shade under the $5000 mark, however, they continue to hover relatively near to those all-time highs. According to the company itself,  MGT Capital Investments, Inc. (OTCMKTS: MGTI) ranks as one of the largest U.S. based Bitcoin miners.

Where real miners use heavy equipment to extract valuable materials from the Earth, Bitcoin miners use computer hardware running special software which solves math equations, and in return is issued a certain amount of Bitcoin.

MGT Capital Investments, Inc. (OTCMKTS: MGTI) has just announced that it has moved to expand its Bitcoin mining capabilities by a significant margin. The company entered a purchase order with Bitmain Technologies for in excess of 1,000 mining ‘rigs’ which was revealed last month, and already the order has been increased.

MGTI increased its purchase order with Bitmain for an additional 500 S9 Antminer Mining rigs, with shipment expected in mid fourth quarter 2017.

Following shipment and setup, and in conjunction with the Company’s current rigs in operation, MGT’s Bitcoin mining operations are expected to generate approximate $1.4 million in monthly revenue, assuming current pricing and difficulty rates. Factoring in electricity, hosting and other direct operating costs, EBITDA from the Company’s Bitcoin mining operations is projected at $1.0 million per month, prior to amortization of notes payable.

Funds for the larger order were provided in part through the exercise of an option today by an existing institutional investor to purchase a $500,000 MGT Convertible Note. Stephen Schaeffer, President of MGT Crypto-Capital Strategies, stated, “We appreciate the confidence of a well-informed investor to provide us with capital to more quickly roll out our expansion. Furthermore, we look forward to updating the investment community and shareholders with further progress.” (Source: PR Newswire)

 

Each S9 Antminer machine supposedly generates roughly 0.36 Bitcoin (btc) every month, and retails for nearly $2000USD, although it’s a veritable certitude that MGTI received a considerable bulk discount for such a high number of rigs. The units are also among some of the more energy efficient machines on the market today.

For those who are still having trouble understanding the whole concept of BTC mining, a simplified overview: Bitcoin mining is essential a computational process, which yields bitcoin as a byproduct of computational power being devoted. These virtual transactions are verified and bundled into ‘blocks’ which are chained together (hence the term ‘blockchain’ that you’ve undoubtedly heard) and propagated throughout a decentralized network.  That grows when more miners join the network, which in turn leads to an increase in block creation rate. That causes the average mining time to decrease, which causes the mining difficulty to go up, reducing the number of blocks produced, normalizing the process, which then begins anew.

In essence miners are exchanging time, processing power, and electricity for bitcoin. Individual miners can’t make very much money, but when massive server farms are built, like the one MGTI is constructing, the rewards can be considerable. We’re interested to follow the progress on MGTI’s mining operation build, and perhaps be provided with more specific details on the potential Bitcoin yields involved.Stay locked to Street Register for updates, and we’ll deliver important developments on MGTI as they unfold. In the meantime, if you’ve yet to sign up for our 100% free newsletter, do so now! Just enter your active email address into the box below and submit!

Disclosure: No one at Street Register has been compensated in any way for the publishing of this article, nor do we hold any position in MGTI stock, short or long.

 

 

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