Square isn’t just bullish on Bitcoin. The company wants a part of the mining industry too.

At the Bitcoin 2021 conference, Square CEO Jack Dorsey said, "Bitcoin changes absolutely everything. [...] I don't think there is anything more important in my lifetime to work on.” His company holds a notable amount of bitcoin too, after investing $50 million and $170 million into the leading cryptocurrency in Oct. 2020 and Feb. 2021.

Beyond just buying BTC, Square has taken several significant steps to participate in the mining industry.

  • Publishing mining research
  • Investing in “clean” energy for mining
  • Building mining farms
  • Designing mining hardware
  • Square’s CEO mines bitcoin

This article explores those moves and Square’s future plans.

Publishing mining research

The inner workings of the cryptocurrency mining industry are generally poorly understood, and Square wants to fix that. Specifically, they want to draw more attention to the revolutionary potential of Bitcoin mining for “clean” or alternative energy sources.

In April, the company published a five-page white paper called “Bitcoin is Key to an Abundant, Clean Energy Future.” The paper’s introduction clearly explained its purpose, namely “to explain how the Bitcoin network functions as a unique energy buyer that could enable society to deploy substantially more solar and wind generation capacity.”

Investing in “clean” energy for mining

In early December 2020, Square released its plan to be net carbon zero by the year 2030. As part of this announcement Square shared their Bitcoin Clean Energy Investment Initiative. This initiative commits $10 million to support companies working on green energy technologies within bitcoin mining.

All profits from this initiative will be reinvested into green bitcoin mining projects. Square’s mission and vision is to enable economic empowerment, their pivot towards Bitcoin highlights the important role Bitcoin has to play in enabling global economic empowerment.

Building mining farms

Further deepening the firm's Bitcoin infrastructure support, Square announced a partnership with Blockstream, investing $5 million to develop a solar-powered bitcoin mining facility. Bitcoin has faced a significant amount of mainstream media criticism around its energy consumption. Square's hopes to change that narrative with its “green” bitcoin mining investment.

Square will also create a public dashboard displaying the facility's ability to mine bitcoin via renewable energy profitably. The payments company hopes their transparency around the investment will act as a case study for other companies to use renewable energy for bitcoin mining.

Designing mining hardware

Currently, the biggest producers of ASIC miners are Asia-based firms, specifically MicroBT and Bitmain. Joining a growing effort to distribute and recognize global manufacturing and distribution lines for mining ASICs, Square CEO Jack Dorsey announced that Square has begun developing a bitcoin mining system.

The goal of Square’s project is to make Bitcoin mining easy, accessible and decentralized. But the project won’t be simple. ASICs are some of the most sophisticated technologies manufactured on earth. The complexity in their production, combined with a limited number of capable suppliers, results in a consistent backlog on ASIC orders.

Square’s CEO mines bitcoin

Square's CEO is no stranger to bitcoin mining. Dorsey has been personally mining bitcoin with none other than Compass Mining. Given Dorsey's complaints that Bitcoin mining is overwhelmingly complex, it makes sense that he chose to start mining with Compass given the holistic support for at-home or hosted mining for retail investors.  

Conclusion

Square and Jack Dorsey have contributed to the general Bitcoin industry in many ways outside of mining, including donations to Core developers and plans to build a new hardware wallet. But the company and its leadership understands the importance of mining as a means for network security and the role decentralization plays in bitcoin's resilience. Square's expansion into Bitcoin mining is transparent and open-source, underscoring Jack's commitment to securing Bitcoin’s future instead of Square’s bottom line.

But the company’s increasing activity in the mining industry is notable because most public companies interested in Bitcoin are content to invest and sometimes fund development. Participation in the mining sector isn’t common. Square seems intent on executing a holistic strategy for participating in the Bitcoin economy, and it’s mining research, investment, and products are exciting developments for the industry.