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- Compass Mining is an online marketplace for Bitcoin mining hardware and hosting.
- Mining industry is facing headwinds amid rising hash rates and the crypto winter.
- Compass Mining’s new product is a welcome step in an industry affected by extreme volatility.
A product to protect retail BTC miners
Compass Mining announced the launch of “Compass Mining Protection Plan,” a first of its kind. It is designed to protect Application Specific Integrated Circuit (ASIC) Bitcoin miners.
In a press release, the firm announced that new the plan “is available for all customer-hosted equipment at Compass Mining’s partner facilities located in Texas, South Carolina, Nebraska and Oklahoma.”
ASIC Bitcoin mining enables individuals to participate in the Bitcoin mining industry which is dominated by wealthy corporations. However, these miners are not protected “against unforeseen events including natural disasters, hosting incidences or machine theft.”
The plan is offered “for a low opt-in cost.”
Compass Mining brokers deals between those who want to mine Bitcoin and existing mining facilities.
At the moment, the insurance industry does not offer insurance schemes suited for companies such as Compass Mining which deal with relatively new technology like Bitcoin.
Jameson Nunney, the Chief Strategy Officer of Compass Mining stated: Compass Mining is pleased to expand additional protections to our miners,”
“Bitcoin mining is a burgeoning, young industry. Simple protection products like this should be considered a financial primitive. Compass Mining is proud to have built the first ASIC-protection package to offer to retail Bitcoin miners,” he added.
Will Foxley, Director of Content at Compass Mining stated “Our protection plan is one step downstream of an over $75 million insurance policy we’ve created with our brokers.”
Bitcoin Mining: the industry that saw several come, few stay…
Bitcoin mining is the process of generating new coins and is nothing like mining real metals like Gold or Copper. Bitcoin is the most energy-guzzling asset in this industry. No other coin or token has similar energy needs. Ethereum, the second largest crypto in terms of market capitalization, switched to the Proof of Stake mechanism from the Proof of Work mechanism, cutting energy consumption by 99%.
Mining machines are specifically designed computing machines that can complete the highly complicated problems that must be solved to generate new currency. These do not come cheap and that several mining companies shut shop earlier this year is a telling sign of the risk involved in the crypto mining industry. Mining companies have sold expensive mining machines (in some cases unused and new) or have filed for bankruptcy.
Compass Mining was struggling earlier this year amidst a slew of ‘setbacks’– According to a crypto news agency, the brokerage firm’s CEO and co-founder Whitt Gibbs resigned in June this year when the company was struggling with technical issues including delays in machine deployment; and even forced to sell machines worth $30 million in Russia which could not be retrieved due to Western sanctions against Russia.
Steve Anderson is an Australian crypto enthusiast. He is a specialist in management and trading for over 5 years. Steve has worked as a crypto trader, he loves learning about decentralisation, understanding the true potential of the blockchain.
