Blockstream raising funds for mining at 70% lower company valuation

December 7, 2022 Coin Telegraph

Adam Back

CEO Adam Back said the fresh funding will be invested into expanding the firm’s mining capacity.

The depths of a bear market may not be the best time to raise funds but that is exactly what Blockstream is doing.

The crypto infrastructure firm is seeking fresh funding, but at a much lower valuation than previous rounds, according to a Dec. 7 Bloomberg report.

Blockstream was valued at $3.2 billion when it held its last Series B funding round raising $210 million in August 2021. Today that valuation may have fallen almost 70% to below $1 billion according to the report.

The company, founded in 2014, has raised a total of $299 million in funding over four rounds, according to CrunchBase.

Blockstream CEO and cryptographer Adam Back did not share details of the latest funding round but did reveal that the capital will be invested into expanding the firm’s mining capacity.

“We rapidly sold out all of the capacity and have a big backlog of existing and new customers with miners seeking large-scale hosting with us.”

The firm is working with Jack Dorsey’s Block (formerly Square) to develop a solar-powered Bitcoin mining facility. The mining farm will have 3.8 megawatts (MW) of electrical capacity using Tesla’s solar technology and its Lithium-ion 12 MWh ‘Megapack’, as reported by Cointelegraph in April.

Back acknowledged that BTC prices and mining profi tability were down but added “hosting rates have risen over the last quarters and our mining services are a rapidly expanding, high-margin enterprise business for us.”

Bitcoin miners are currently suffering a triple whammy of high hash rates and difficulty, high energy prices, and low BTC prices. This has caused profitability, or hash price, to fall to near-record lows of around $0.064 per TH/s per day, according to Hashrate Index.

In its monthly newsletter on Dec. 5, Blockstream revealed that its Blockstream Mining Note (BMN) token has earned around 5.37 BTC cumulatively in returns nearly halfway into its three-year term.

BMN is an EU-compliant security token that provides qualified investors access to Bitcoin hash rate at the firm’s U.S. enterprise-grade mining.

The firm has also been promoting a new limited edition ‘Jade Transparent’ hardware wallet claiming that it is “hodling our Bitcoin into the 2090s and beyond.”

Blockstream CEO Adam Back talks Bitcoin over a game of Jenga

November 16, 2022 Coin Telegraph

Adam Back

Back was one of the few people cited in the original Bitcoin whitepaper.

Ever since his childhood years, Adam Back, now CEO of Blockstream, would spend his time fidgeting with programming code to look for encryption keys embedded in the software. Born in 1970, the London native completed his A-levels in mathematics, physics, and economics before focusing on computing science and earning a Ph.D. from the University of Exeter. Having devoted his career to applied cryptography, Back invented HashCash in 1997, a proof-of-work system used to limit email spam and denial-of-service attacks that later became more renowned for its use in Bitcoin. In fact, Back was one of the few people to be cited in the original Bitcoin whitepaper.

Nowadays, Back manages his digital asset custody firm Blockstream based in Victoria, Canada, which raised $210 million in a Series B round last August. During an interview with Cointelegraph reporter Joe Hall, Back explained what fascinated him so much about Bitcoin at first was its fertile ground for a lot of applied research and development. "It covers lots of interlayer topics or people, like mathematics, computer science, and programming," he said.

When asked what advice he could give to the new generation of Gen Zs and Boomers approaching Bitcoin alike, Back suggested first getting to know the people in the industry. "I think the good way to get involved is to sort of try to contribute to something as a volunteer, as you learn things when you get to interact with people. You know there could be many different things to come across, like user interface, documentation, or educational materials."

The 52-year-old cryptographer is also exploring new physical boundaries for the use of Bitcoin, literally. For a few years now, Back has been operating the Blockstream Satellite Network, which broadcasts the entire Bitcoin blockchain around the world 24/7 through its leased satellites. "You could sync a node from scratch by the satellite; it will take a week or two," he said, continuing: "but it actually fetches all the history as well and reassembles it. And it's some pretty cool kind of tech in terms of error correction and redundancy." According to Blockstream, the setup can "protect against network interruptions" and "provide areas without reliable internet connections access to Bitcoin." Though, for the privilege of not needing internet to use Bitcoin, one would need a satellite kit in order to receive transmissions.

Bitcoin in space is good for user privacy, says Adam Back

October 17, 2022 Coin Telegraph

Adam Back

In an exclusive interview with Adam Back at Bitcoin Amsterdam, the co-founder of Blockstream shared his vision for the Bitcoin space.

Adam Back, the co-founder of Blockstream, took a timeout from the mainstage of Bitcoin Amsterdam, a three-day Bitcoin conference in the Netherlands, to talk with Cointelegraph.

Perched at a park table amidst tulips and bicycles, the man behind the Proof-of-Work algorithm challenged Cointelegraph to a game of Jenga and made a case for beaming Bitcoin into space. One of the few people to be cited in the Bitcoin whitepaper, (BTC) Back also discussed his childhood and his first interactions with computers. The video will soon be published on Cointelegraph's Youtube channel.

But why do we need the Bitcoin blockchain–a decentralized peer-to-peer network already secured by nodes on earth–in space? Do aliens need Bitcoin the way humans do? Back joked with Cointelegraph nonchalantly:

“Well, I mean, there are a few reasons [to having Bitcoin in space]. One because it’s cool, and you can.”

However, it also brings benefits such as privacy: “You can receive the data anonymously because it's broadcast, and basically nobody can tell you're receiving it. So that's good for privacy,” Back continued, moments before winning the game of Jenga.

*Adam Back with Cointelegraph reporter Joe Hall.*

Furthermore, having Bitcoin in space is also “Good for companies because they really need to make sure they're on the right blockchain. If there's a local network issue or if a router is hacked,” then the satellite Bitcoin connection ensures that companies can continue to transact and use the Bitcoin blockchain without hindrance.

Indeed, the news is awash with governments and groups intent on inhibiting access to Bitcoin or cryptocurrency-related activities; so having a connection to a satellite Bitcoin protocol is invaluable and enables greater censorship resistance.

For the global south, the argument for connecting and downloading the backlog of Bitcoin data in order to synchronize a node is the price. Whereas in the developed world, the cost of downloading and synching Bitcoin core could be negligible:

“For emerging markets, the cost of an Internet connection fast enough to keep up with Bitcoin is actually expensive compared to salaries.”

Back explained that you can sync a node at no cost in the developing world using Blockstream satellites. While the process is undoubtedly slower–taking a week or two to update–it means that the barrier to entry for participating in the Bitcoin protocol trends lower and lower.

Finally, Back is still very bullish on Bitcoin. In a tweet on Monday morning, the mathematician shared that Bitcoin will “conservatively” do a 10x in the next five years. That means the Bitcoin price would reach over $200,000 before 2027.

Bitfinex CTO Paolo Ardoino States Salvadoran Bitcoin Bonds to Be Further Delayed

September 1, 2022 Bitcoin.com

Central Bank Digital Currencies Worse Than Bank Accounts and Cash, Says Blocksteam CEO Adam Back – Here’s Why

July 24, 2022 The Daily Hodl

Blockstream dreams up a whole new type of multisig called ROAST

May 25, 2022 Coin Telegraph

Blockstream

In particular, ROAST has been posited as a signature standard that could work with, and improve, threshold signature schemes such as FROST (Flexible Round-Optimized Schnorr Threshold Signatures).

The research unit of Bitcoin (BTC)-focused blockchain tech firm Blockstream has published a proposal for a new type of multisig standard called Robust Asynchronous Schnorr Threshold Signatures (ROAST).

It hopes to avoid the problem of transaction failures due to absent or even malicious signers and can work at scale.

The term multisig or multisignature, refers to a method of transaction in which two or more signatures are required to sign off before it can be executed. The standard is widely adopted in crypto.

According to a May 25 blog post from Blockstream research, the basic idea of ROAST is to make transactions between the Bitcoin network and Blockstream’s sidechain Liquid more efficient, automated, secure and private.

In particular, ROAST has been posited as a signature standard that could work with, and improve, threshold signature schemes such as FROST (Flexible Round-Optimized Schnorr Threshold Signatures):

“ROAST is a simple wrapper around threshold signature schemes like FROST. It guarantees that a quorum of honest signers, e.g., the Liquid functionaries, can always obtain a valid signature even in the presence of disruptive signers when network connections have arbitrarily high latency.”

The researchers highlighted that while FROST can be an effective method for signing off on BTC transactions, its structure of coordinators and signers is designed to abort transactions in the presence of absent signers, making it secure but suboptimal for “automated signing software.”

To solve this problem, the researchers say that ROAST can guarantee enough reliable signers on each transaction to avoid any failures,and it can be done at a scale much larger than the 11-of-15 multisig standard that Blockstream primarily utilizes.

“Our empirical performance evaluation shows that ROAST scales well to large signer groups, e.g., a 67-of-100 setup with the coordinator and signers on different continents,” the post reads, adding that:

“Even with 33 malicious signers that try to block signing attempts (e.g. by sending invalid responses or by not responding at all), the 67 honest signers can successfully produce a signature within a few seconds.”

To provide a simple explanation of how ROAST works, the team used an analogy of democratic council responsible for legislation of “Frostland.”

Essentially, the argument is given that it can be complicated to get legislation (transactions) signed off in Frostland as there are a myriad of factors at any given time which can result in the majority of council members suddenly being unavailable or absent.

A procedure (ROAST) to counteract this, is for a council secretary to compile and maintain a large enough list of supporting council members (signers) at any given time, so that there is always enough members to get legislation through.

“If at least seven council members actually support the bill and behave honestly, then at any point in time, he knows that these seven members will eventually sign their currently assigned copy and be re-added to the secretary’s list.”

“Thus the secretary can always be sure that seven members will be on his list again at some point in the future, and so the signing procedure will not get stuck,” the post adds.

ROAST is part of a collaboration between Blockstream researchers Tim Ruffing and Elliott Jin, Viktoria Ronge and Dominique Schröder from the University of Erlangen-Nuremberg and Jonas Schneider-Bensch from the CISPA Helmholtz Center for Information Security.

Accompanying the blog post, the researchers also linked to a 13 page research paper which gives a run down of ROAST in greater detail.

El Salvador’s Bitcoin Volcano Bonds Launch Still on Hold, According to Treasury Minister

May 4, 2022 Bitcoin.com

Finance Redefined: Samson Mow’s DeFi question, Fireblocks expands to institutional and more

April 30, 2022 Coin Telegraph

Blockstream

In this week's DeFi newsletter we bring you an exclusive research report on Terra, Samson Mow's shocking comment on DeFi and Fireblock's latest DeFi institutional offering.

The week was filled with several new project developments and key updates from leading decentralized applications (DApps) and decentralized finance (DeFi) protocols. Fireblocks has expanded its institutional access to Terra’s DeFi ecosystem and Solana partnered with the Notifi network to improve the abysmal participation rates in governance votes.

We will also look into the Cointelegraph research into the Terra ecosystem’s future and see if it can sustain the current growth. Samson Mow, the former executive at Blockstream, questions the decentralized aspect of the DeFi ecosystem.

Top DeFi tokens saw another week of bearish price action despite several new developments and barring a few, the majority of the tokens in the top-100 registered double-digit losses over the past week.

Fireblocks expands institutional access to Terra’s DeFi ecosystem

Fireblocks, a digital asset custody platform, announced that it has enabled institutional decentralized finance access to Terra, the second-largest DeFi protocol by total value locked (TVL). As per the announcement, Fireblocks users can now securely access all the decentralized applications built on the Terra blockchain.

The launch is in response to Fireblocks’ early access program users, who invested over $250 million into the Terra DeFi ecosystem within the first 72 hours of its integration going live.

Continue reading

‘DeFi is not decentralized at all,’ says former Blockstream executive

Samson Mow, former chief strategy officer at Blockstream and founder of JAN3, is convinced that most decentralized finance protocols can’t compete with Bitcoin (BTC) when it comes to providing an effective monetary network because of their lack of decentralization.

As Mow pointed out, DeFi projects are governed by entities that can modify the protocol at will.

“Bitcoin, at the fundamental level, is money, and it should be immutable,” explained Mow. “If you can change it at will, then you’re no better than a fiat currency governed by the Fed.”

Continue reading

Solana DAOs can now bug you to vote with phone calls and texts

The Notifi Network is banking on this concept to help improve the abysmal participation rates in governance votes. Launching with Solana decentralized autonomous organizations, or DAOs, it combines popular centralized methods used by the Web3 community such as Telegram and Discord pings with more traditional and harder to ignore notifications like phone calls, text messages or emails.

Backed by crypto venture capital firms Race Capital and Hashed, on April 24, Notifi applied its notification service to all DAOs that launched on the Solana Realms DAO platform.

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Can Terra blockchain sustain its growth? Research report digs deeper

Cointelegraph Research fundamentally evaluates Terra in its 50-page report to provide an in-depth analysis of its recent updates, including Columbus-5, the Bitcoin acquisition and others.

Decentralized algorithmic stablecoins, blockchain integration in real-world payments and 20% annual percentage yields (APYs) on DeFi protocols — what is all of this, and is it really doing this? The team of experienced cryptoanalysts from the Big Four and the best universities worldwide dives deep into the blockchain’s ecosystem, community and underlying technology, assessing the potential regulatory, market and technological risks.

Continue reading

DeFi market overview

Analytical data reveals that DeFi’s total value locked dipped by one billion dollars, falling to $123.08 billion. Data from Cointelegraph Markets Pro and TradingView reveals that DeFi’s top 100 tokens by market capitalization registered a week filled with volatile price action and constant bearish pressure.

Majority of the DeFi tokens in the top-100 ranking by market cap traded in red, barring a few. Kyber Network Crystal v2 (KNC) was the biggest gainer with a 25% rise over the past week, followed by Kava (KAVA) at 17% and Curve DAO Token (CRV) at 8%.

Thanks for reading our summary of this week’s most impactful DeFi developments. Join us again next Friday for more stories, insights and education in this dynamically advancing space.

Tesla Ventures Into 100% Solar-Powered Bitcoin (BTC) Mining With Jack Dorsey’s Block: Report

April 10, 2022 The Daily Hodl

Blockstream and Block Inc to build solar Bitcoin mining facility powered by Tesla technology

April 8, 2022 Coin Telegraph

Bitcoin mining

The site will use a combination of solar panels and battery storage from excess daylight to power Bitcoin mining.

On Friday, cryptocurrency storage company Blockstream and Block Inc. (formerly Square) announced the construction of a solar-powered Bitcoin (BTC) mining facility in Texas. As told by Blockstream, the mining site will be outfitted with 3.8 megawatts (MW) of electrical capacity using Tesla's Solar photovoltaic cell array and a 12 MWh Megapack.

Manufactured by Tesla Energy, Megapack is a powerful lithium-ion battery that provides energy storage and support. In context, one of the leading publicly-listed Bitcoin mining companies, Hut 8 Mining, has about 209 MW in total contracted mining capacity. The purpose of the venture is to investigate the feasibility of operating a zero-emission energy Bitcoin mine. Blockstream and Block began collaborating on the project last June, with Block promising to invest $5 million for its construction.

In addition to its physical construction, the teams at Blockstream and Block will build a publicly accessible dashboard to report on the project's economics. Key metrics will include power output, the number of Bitcoin mined, storage performance, total uptime, expenses and return on investment, etc. It will be accessible 24/7 from any browser.

While solar Bitcoin mining is theoretically carbon-neutral, there is a great deal of controversy within the crypto community about its practicality. In June 2021, Braiins, the world's oldest Bitcoin mining pool, published a feasibility analysis on using solar energy to mine Bitcoin and concluded that it was not profitable, even when considering near-free electricity costs and recycling surplus energy during peak sunny hours. Braiins' chief marketing officer Kristian Csepcsar is also an outspoken critic of solar Bitcoin mining, pointing out that using traditional metrics to evaluate its "environmental friendliness" doesn't account for variables such as the production of "brutally" harmful chemicals during the manufacturing of solar panels.

Blockstream

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