Bitcoin mining has undergone a massive transformation in the last year as a crackdown in China has led much of the industry to relocate to North America. That's one reason Foundry, a fast-growing U.S. mining company, is launching a new market to match buyers and sellers of used Bitcoin mining rigs.
Called FoundryX, the new service promises to act as an eBay of sorts for the mining industry, tapping into its relationships with hundreds of buyers and sellers and serving as a reliable middleman for a business once known for secretive or dodgy practices.
"People want transparency," said Jeff Burkey, Foundry's VP of Business Development, who told Decrypt that buying Bitcoin mining rigs has historically required an act-of-faith revolving around wire transfers to China.
Foundry, which also operates a mining pool and runs machines of its own, says it has facilitated over $125 million in equipment sales in 2021, and that it has secured over 40,000 machines for delivery through 2022.
In the early days of Bitcoin, people would mine it using home laptops or even cell phones. By 2015, however, Bitcoin's growing popularity required would-be miners to obtain additional computing power in the form of specialized machines built with custom chips.
Today, those machines typically cost thousands or tens of thousands of dollars and are produced by two China-based manufacturers, Bitmain and MicroBT. According to Foundry CEO Mike Colyer, China's crackdown on crypto has targeted domestic activities but not the manufacture of machines for expert.
But Colyer added that the crackdown has led to a scramble as Chinese miners have sought to move their machines out of the country or sell them to buyers in other countries, including in the U.S. This has led to an opportunity for Foundry as it helps both buyers and sellers navigate the tricky process of shipping mining rigs halfway across the world.
While Foundry is less than two years old, it has grown rapidly. The company initially focused on its own mining Bitcoin operations but soon expanded to help other North American firms obtain and finance equipment, and in February launched a pool that has emerged as one of the world's biggest.
A subsidiary of the giant crypto conglomerate Digital Currency Group, Foundry is also serving a strategic role for its parent company by cross-selling financial and administrative services offered by Genesis, another DCG company, to its mining clients.