The Worm Farm Miner: Nick Jackson of Blokforge

His most interesting customer runs a worm farm. Bitcoin miners heat the worms, the worms make compost, and the compost grows vegetables. Nick Jackson, founder of Blokforge, told that story at Mining Disrupt Miami 2022, held July 26 to 28, 2022, when Bitcoin traded at $22,964. Today it trades at $80,900.

Blokforge is a miner distributor based in a 100,000-square-foot facility in downtown Mesa, Arizona. Its parent company started in 2003 making parts for automotive, defense and aerospace customers, and moved into Bitcoin hardware around 2016, after a friend who played World of Warcraft brought it up.

Jackson's pitch was about businesses that already exist. Many of his customers, he said, are mid-sized companies with one to five million dollars, from farms and ice cream shops to grow operations and retail stores. One ice cream shop had a big year. In Jackson's words, it "had a massive year a lot of profit a lot of revenue looking for ways to offset". It bought miners and depreciated them under Section 179, either fully or over five years. Jackson estimated that tax savings like these lower mining costs by up to 33 percent or more in some cases.

Then there is the power bill. A customer that makes large steel beams pays a peak demand charge on top of its energy rate. Jackson said that charge runs $2,500 to $3,000 whether the machines run for five minutes or all month. So the plant adds miners below that peak and does not run them during the four to eight hours a day its own machine is running. He said that lowers its cost to mine by at least forty percent.

Heat is the third reason. Grow operations plumb miner heat into buildings they were already paying to heat. Warehouses on the northern East Coast put miners just below the roof to keep staff warm all winter. And on the worm farm, he said, "it's like a whole cycle".

Jackson also talked about trust. Blokforge has been in business since 2016, and he estimated that about 80 percent of the people in the business were lost in the first crypto winter.

Asked about his ideal customer, he said he prefers people mining with their own money, because they are more careful with it. As he put it, "that's what keeps the decentralization is all these small guys scattered across the planet".

Asked about people who try to talk individuals out of small-scale mining, he said he did not know why anyone would. When capitulation comes, he said, the big operators feel it and the small ones keep going.

The full story is on Mining Disrupt at miningdisrupt dot com, and many more like it play around the clock on Bitcoin Radio.