Cryptominers be minin’ – DMG Blockchain (DMGI.V) and Hashchain Technology (KASH.V) making moves

02/27/2018

Some news to report on both DMGI.V and KASH.V today. Both are cryptominers who we cover regularly. Both of these fine companies also have the far-sight and visionary leadership to engage us as clients. 

Unlike the broader market, we watch them closely and they get to watch us celebrate their successes and slap ‘em around when they fail.

Which one are we doing today? Read on my friends.

DMG Blockchain – From potential to production.

The big news for DMGI.V this week is the announcement their phase 1 facility is almost ready to go online. This is the starting bell for the next phase of their business. Like so many blockchain companies, DMG was talking a great game but was still all strategy. 

Now the rubber is meeting the road. Here’s how their new facility will look when ready in the next few months: (From yesterday’s release)

“Flagship facility will make it one of the largest crypto mining facilities in North America with expected power capacity of up to 85 megawatts;

40 megawatts of near-term power capacity planned to be on-line midyear;Mining facility to accommodate additional mining-as-a-service (MaaS) customers as well as DMG’s own mining and address substantial demand from Asia.”

Once the facility is up and running, DMG is going to be ready to throw the doors open in a big ‘Grand Opening’ for their Mining-as-a-service (MaaS) products. 

DMG will split its operation between this MaaS approach and traditional cryptomining. This will give them a more diversified business than other cryptominers. The MaaS side is also their unique hook. In time, as they optimize their system, I suspect this side of the business will dwarf the other stuff they do – much like Amazon’s cloud and server services have become a huge component of what started as an online bookseller business.

With the new facility enjoying the twin luxuries of cheap power and highly skilled technical talent, it’s great to see some real concrete developments on this new site.

The stock’s only been trading for a couple of weeks, and after a nice ride initially, it’s settled back down to about .10 a share. I think when DMG announces they’re cutting the ribbon on this new facility, the folks who buy in now will be very happy with the market reaction.

Verdict: Clap clap clap clap.

Hashchain Technology – Big Rig keep on growin’

Another relative public cryptominer newcomer is KASH.V – the stock only began trading in December as it raises money for its own monster mining facilities. With a big one in operation in Montana and another growing in Vancouver these guys are betting on being big as their path to success.

I’ve written about these guys and their rig madness before. (I mean that in the best way) In yesterday’s announcement they lay out their latest plans to build a mining cluster that can be used to push around smaller mining operations around on the schoolyard and take their lunch money.

I like a big baller PR move, and yesterday’s release is pretty much a ‘we-have-nothing-really-new-but-need-to-goose-things’ kind of press announcement. No judgement here, just observing.

The release tells us the following:

“Hashchain is operating 100 cryptocurrency mining rigs from its Vancouver data centre, with an additional 770 rigs currently being configured at the company’s 20-megawatt Montana, United States, facility. Upon expected deployment in early March, 2018, Hashchain will be mining Dash and bitcoin with a total of 870 rigs at 1.23 megawatts of computing power in ideal conditions to maximize return on investment. As previously disclosed, the company has also purchased 3,000 rigs, which will be received at the Montana facility in two shipments of 2,000 rigs and 1,000 rigs by the end of March and April, respectively. In May, 2018, Hashchain estimates 3,870 rigs will be deployed with approximately 5.8 megawatts dedicated to mining.”

You know those machines we said we bought? We bought ‘em. They are still bought.

“Hashchain purchased 1,000 Dash cryptocurrency in October, 2017, the amount required to be maintained in a wallet in order to become a masternode. As a masternode, Hashchain can vote on initiatives and important decision regarding the future of Dash, as well as facilitate anonymous and instant transactions on the blockchain that prevents double spending and eliminates bottlenecks often displayed in proof-of-work blockchains…. ….The company will not be receiving Canadian dollars (or any other fiat currency) as a result of the company’s plans not to convert the Dash from the masternodes into fiat currency and until the company’s plans change, at which time there can be no assurances that the price of Dash will not significantly decrease due to its price volatility or that the Dash could be converted into Canadian dollars (or any other fiat currency) at that time.”

We invested in DASH. We think it’s gonna be big. If it tanks, sorry. If it doesn’t we will rock this market.

“NODE40 Balance is a blockchain accounting and tax software that allows cryptocurrency coin holders to conduct accurate tax compliance by analyzing the blockchain to calculate exact net values from each transaction, the cost basis and days carried. Balance can then produce a worksheet with gains and losses that can be shared with a certified public accountant and easily reported to tax authorities around the world. 

On Feb. 7, 2018, Hashchain integrated the software with Coinbase, the largest global digital-currency exchange with over 13 million users (source: CoinDesk and Coinbase). This expansion enables Balance to help coin holders report gains and losses for five leading cryptocurrencies, bitcoin, bitcoin cash, Ethereum, Litecoin and Dash. 

While there is no formal agreement between NODE40 and Coinbase, the NODE40 Balance addition means Coinbase accountholders can request and import their own personal information and transaction history onto a compatible piece of software. Hashchain plans to expand its software solution to additional exchanges and digital currencies in the near future.”

Shit. This one is really cool. Ok, so we set up software to make everything faster and more transparent (They also implemented NODE40 in their DASH operation). I like anything that removes pain points and improves efficiency, especially in a digital market where trends can develop in microseconds.

So overall, KASH.V is just letting all of you out there in TV Land they are still doing the things they said they would do, and the things they have already done are smart. They also don’t shy away from telling you what’s risky in their plays.

That kind of communication, even cloaked in PR speak, is a rare enough event in this world.

Verdict: Grudging Clap on the PR move, Clap Clap Clap on the things you’re actually doing, but wait until you have something real to announce next time.

Full disclosure: Both of these cryptominer companies are clients, but I don’t own stock in either of them, I believe some of the team does. 

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