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Inside a $4 million Icelandic bitcoin-mining consortium

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Bryan Pocius / Flickr

In Dealbook, Nathaniel Popper takes a look at a bitcoin-mining business called Cloud Hashing, that's moved its computers to Iceland in search of easy cooling and cheap, renewable power. The current set up requires over 100 computers, designed specifically for cracking the obscure algorithms that unlock new packets of bitcoin, and all cooled by direct blasts of arctic air. Cloud Hashing currently serves mining contracts for 4,500 customers, keeping 20 percent of its capacity open for its own mining. According to the outfit's account, it's mined more than $4 million of the cryptocurrency.

The project was started by British HSBC programmer Emmanuel Abiodun, who set up the Icelandic rig in February with the help of some angel investors. He's already raised $4 million to expand to additional storage in Texas. Still, Abiodun is in a potentially tricky place as the currency's value plummets. Since his millions in machinery are only useful for mining bitcoin, a crash would render the entire setup useless.