Buzzing in the bowels of an office building in North Johannesburg is a cryptocurrency mine that is ranked among the most profitable in the world.
Graphics card banks, powered by solar panels placed on the roof above, solve complex math puzzles and are rewarded in a currency known as a transaction service fee, or TSF. TSF is the currency used to transact on the transaction service fee blockchain, and is currently valued at roughly $ 0.24, which has increased fivefold in the last nine months.
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The TSF price surge has attracted crypto ‘miners’ from around the world eager to embark on one of the most profitable mining companies in the world.
Crypto mining has become a massive global business, with its own economy made up of mining ‘rig’ providers, developers, and the miners themselves.
Earlier this year, China banned crypto mining and that led miners to nicer places with relatively cheap electricity like Texas in the US and Kazakhstan.
South Africa, with its notorious power grid problems, is not on the list of most favored nations for cryptocurrency mining.
Which makes the TSF crypto mine even more interesting. As cryptocurrency prices rise and fall, miners turn their attention to the next gold rush and recalibrate their equipment for the most profitable mining companies available. And that has put TSF on the world crypto map.
The crypto mine is owned by a blockchain company called Libertas, which is part of a global revolution focused on smart contracts and blockchain technologies that enable business transactions without the need for agents such as lawyers and banks. For example, wills, insurance contracts, and financial contracts can be written in computer code and executed without dispute or delay.
“It may seem strange to some of us that we are mining cryptocurrency from an office park in Rivonia and doing it profitably, but solar panels are needed to do it effectively,” says Libertas COO Dragan Vidakovic. .
The solar panels generate 3.34 kilowatts of energy, which is enough to power the crypto mine, which produces 1 gigashash (or a billion ‘hashes’ or puzzles) per second, and supplies the electricity needs of the Libertas office, including lights. , computers, air conditioning and other appliances.
A second and much larger 15 gigahash crypto mine is located in Bosnia-Herzegovina in Europe, powered by hydroelectric power.
Both mines are generating TSF coins to fund payments and transactions on the TSF blockchain. Customers must purchase TSF ‘tokens’ or coins to transact on the blockchain, and this creates a constant demand for coins.
While dozens of miners around the world have set up mining operations to benefit from TSF coins, Libertas itself accounts for the majority of mining activity.
The surplus energy generated by the solar panels is stored in batteries, which keep the mining rigs running during the night hours, with the Eskom grid running between two and four hours a day, depending on the quality of sunlight during the hours. of the day.
Joburg’s farm makes around 30 coins an hour, and the Bosnian operation makes 15 times this amount.
“Here at Joburg we have around 12 kilowatts available from the solar panels, and we are only using about half of that, so we have the capacity to expand the mining operation, which we will do as the demand for coins increases,” says Asif Aziz. , director of technology at Libertas.
Demand for TSF coins is coming from commercial clients, such as insurance companies, looking to remove human agents from their business operations and execute smart contracts based entirely on computer code.
All kinds of business processes are being transferred to the blockchain.
Take the subject of wills, for example. They rely on intermediaries such as attorneys and financial advisers to draft the wills and then interpret them when it comes time to distribute the deceased person’s estate. A much simpler method is to write the conditions of the will in computer code in the form of a smart contract that cannot be modified or disputed later.
Read: ‘The future is crypto’
Demand for TSF coins is also coming from those interested in issuing NFTs or non-fungible tokens, which is creating a massive new economy around electronic property rights.
Hear Simon Brown’s interview with Revix founder Sean Sanders on this MoneywebNOW podcast (or read the transcript here):