German company Xolaris launches Bitcoin mining investment fund
German investment firm Xolaris has launched a European private equity fund focused on Bitcoin mining, CNN reports. Xolaris expects to raise $34 million to $57 million for the four-year project, the company announced in a press release.
“Professional investors are constantly asking us to create regulated products in the cryptocurrency sector,” said Stefan Klaile, CEO of Xolaris. The minimum investment amount for this fund is $285,000.
Klaile said the new fund is a joint venture with Marc Stehr, owner of an existing 2,000-unit supercomputer mining farm in Sweden. Part of the fund's funding will be used to expand data centers in Sweden, such as expanding the Swedish Bitcoin Mining Center
“We decided to collaborate with Marc Stehr on a product because Mr. Stehr already has the existing mining infrastructure in his project, which has proven to successfully produce Bitcoin,” Klaile said. “This means that some of the risks have been eliminated.”
Xolaris said that due to the country's cool climate and low electricity costs, the location of the Swedish Bitcoin mining farm is ideal. As CCN reports, Sweden's political environment may be more favorable to cryptocurrencies as the country is rapidly becoming a cashless society. In fact, some Bitcoin miners in Norway are considering relocating to Sweden after the Norwegian government removed tax subsidies on Bitcoin miners' electricity.
Xolaris Group is also planning to launch a $50 million Bitcoin mining fund for Asian investors in Hong Kong.
Following the launch of its flagship European fund, subscription for Asian funds will begin in December, according to Stefan Klaile. Klaile isn't worried about the current crypto bear market, saying it's actually an advantage for his company as it will eliminate competition.
“We think the current decline in the price of Bitcoin is quite positive,”KlaileSay it. “Bitcoin mining returns are affected by various drivers, including Bitcoin price level, hash value, mining difficulty, and the price of mining equipment such as servers. We are seeing recent developments providing mine operators with an opportunity to increase their market share. ”
Klaile said that while the success of his crypto investment fund depends on Bitcoin's performance, that doesn't mean everything has to stop due to a temporary market downturn.
“Just like the automotive industry, car manufacturers won't stop making cars because the used car market crashes,” he said.
Stefan Klaile echoed the views of Barry Silbert, founder of crypto investment fund Digital Currency Group.
Despite people's distress over the rising cost of mining,SilbertIt said that Bitcoin mining costs are not an appropriate benchmark for considering cryptocurrencies as an asset class, “I don't agree with the premise that Bitcoin mining costs should be used as a good entry point,”SilbertSay it. “You have to separate miners' investment decisions from their operating costs to mine Bitcoin.”
SilbertSaid that the cryptocurrency mining business has a long-term focus; they don't consider short-term gains or losses.
“Miners are long-term investors,” he explained. “The mining business created in the past five years has accumulated significant capital. They are capable of continuing to mine at a loss. ”
Crypto mining company Coinmint plans to invest $700 million to build the world's largest Bitcoin mining center in upstate New York, CCN reports.
So far, Coinmint has invested $50 million to convert a 1,300-acre Alcoa smelter in Massena, New York.
The new mining farm is expected to be fully operational in June 2019. Coinmint signed a 10-year lease for the property, marking its long-term confidence in Bitcoin.
Source: Ziran
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