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Why One State Isn't Enough: Precision Miners' Geographic Bet
Krunal Joshi applies oil-and-gas risk tactics to hosting, betting that spreading sites across Missouri and Kansas ensures survival.
A single tornado can end a Bitcoin mining business, if every machine sits in one place. That is the risk Krunal Joshi, managing partner at Precision Miners, built his company around. He spoke at Mining Disrupt Miami 2024, June 24 to 26, 2024. Bitcoin traded at $61,272 then. Today it is $83,316.
Precision Miners is a hosting site provider. It builds sites and runs around 20 megawatts of hosting across about 12 locations in Missouri and Kansas. Joshi's background is in oil and gas, and he brought one rule with him. In his words, "we try not to put all our eggs in one basket."
Before the company picks a site, it looks at three things. Energy cost comes first; Joshi called it probably the most important, because everyone wants the lowest power rate. Second is regulation: with governments clamping down on mining, the company tries to stay in areas with low regulation. Third is infrastructure, such as a substation already in place and materials that are easy to get. One recent purchase is a 20-megawatt greenfield site in Missouri, right next to a substation and just off a freeway.
Why spread out? Weather, for one. In Joshi's words, "we are in Tornado Alley so if you had all your sites in one location and a tornado came by I mean that would pretty much mean the end." Spreading out also opens up stranded energy such as natural gas, which the company is big in.
Then there is the power company. Joshi's line was simple: you can't let the electricity provider dictate terms to you. Precision Miners has tested it. When one site raised its prices by 20 percent, the team packed up and was running at a new site within a week.
The company moves fast in the other direction too. It built a 5-megawatt hosting site for a client in 30 days. It usually starts a new site at five megawatts and, when it is happy with the site and the landowner, has expanded from five to 20 megawatts within a year.
Joshi was open about the costs. Many sites need logistics planning, so the company placed warehouses strategically, wrote a risk management plan for each site, monitors everything from a central location, and keeps one or two technicians at every site.
The full story is on Mining Disrupt at miningdisrupt dot com, and many more like it play around the clock on Bitcoin Radio.