Blockchain Business – LeoNovus (LTV.C) gets PO’d from Government of Canada, Hashchain (KASH.C) rigs up a monster mining setup

01/24/2018

As everyone continues to scream about cryptocurrency meltdowns, bubbles, gottendammerung, ragnarok, or what have you, the operators in the space continue to make moves. Blockchain technology and cryptocurrency aren’t going anywhere, and the smart investor knows to look at the players, not the game.

Two sides of the same cryptocoin – Hashchain gears up.

Hashchain (KASH.C) announced today they received 770 new chinese mining rigs for deployment at their Montana site. The move will goose their overall capacity to 1.23 megawatts of computing power.

The company has a site in Vancouver and is bringing the Montana site up to full operation. According to the CEO, they expect to grow to 8.3 megawatts of power by mid-2018. If one BTC transaction takes approximately 215 Kilowatts the capacity of the new site means they can hypothetically process up to 40 transactions an hour.

If they are mining other cryptocurrencies, the rate is even faster. This means more coins mined, more transactions completed and more cash in KASH’s pocket. Finally, having a nice scalable mining site can also be repurposed in the future for other computing services.

Also remember, the virtual vaule of crypto is all about perceived utility and future growth. Mining companies like Hashchain are building facilities that could survive a burst bubble through re-deploying resources.

Or to put it another way, they are building greenhouses to grow tulips, and if and when the tulip bubble bursts, they can move to growing carrots or potatoes. Much smaller profit margin, but enough to keep the lights on.

To sum up – companies that are investing in gear, infrastructure and long-term viability are a good option to look at, because they aren’t going to live and die by the BTC.

Finally, on a semi related note, I appreciate that KASH bought Chinese machines. I am trying to upgrade my PC, and I can’t find a decent Nvidia GPU for a non-crazy price for love or money. The blockchain craziness is now affecting consumer grade electronics.

(Of course who knows if Chinese rigs have state-mandated backdoors, etc.)

Two sides of the same crypto coin – LeoNovus now ready to supply government.

Ooh this one is really cool. LeoNovus announced today they have received a $500K purchase order to install their blockchain storage technology in federal government departments. They will providing a secure storage solution for government data based on their blockchain technology.

This is essentially a pilot project to see how the technology meets the needs of government. There are options for three more systems, bringing the total potential value up to $2 million.

LeoNovus made their blockchain pitch through the Build in Canada program. it’s the usual thing of subsidizing local industry by providing seed capital and ‘first customer’ presence.

I used to work in government, in the ‘Technology’ ministry. I met with a lot of startups and I would hear again and again: “We can’t sell in Canada, we have to sell to the US or Europe and then we can talk to Canadian companies.”

It’s true – we can be a pretty risk-averse bunch.

One of the suggestions I had made (with my colleagues from procurement) was to institute a program in B.C. which would fast-track innovative technologies in government procurement. If the B.C. Government was a client, it was a very reassuring sign to Canadian investors and customers.

If we did this, we could innovate, and support local tech start-ups.

The suggestion was promptly ignored. (my manager was dumb as a bag of hammers, and mean as sack of cats)  It would seem the Feds have bit more sense.

Getting the nod from the Federal government to deploy its tech is a big shiny gold star on LeoNovus’ worksheet. It will be very reassuring to squirelly purchasing managers and IT departments.

Even better is if they become a standard supplier to government for this tech. They can ride that gravy train for a long, long time.

Now’s a really good time to look at LeoNovus. That government contract money is pretty sweet.

FULL DISCLOSURE: LeoNovus and Hashchain are both EG clients, but I do not own stock in either company.

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