What if we could generate electricity from the ocean by using the temperature differences between the deep ocean and the surface? That’s what Nate Harmon from Blockchain Solutions Hawaii is working on. This conversation is pretty wild so stick around to find out what manganese nodules are.


Audio Version


Foxley: Welcome back to the Compass Podcast. Today we're joined by Nathaniel Harmon, CEO and founder of Blockchain Solutions Hawaii. Nate is working on oceans technology that energizes and monetizes ocean thermals with Bitcoin. This is one of the more bleeding edge conversations we've had on the podcast. So be sure to stick around. This podcast is presented ad-free by compass mining the largest marketplace for Bitcoin mining, check out compassmining.io today if you want to buy, sell, or host an ASIC, and now on to the show. Nate, thanks for coming on the podcast really appreciate your time. And when this came across my Twitter feed, I was pretty jazzed about it. We get some interesting Bitcoin miners on the podcast for sure, lots of different personalities. But we're mostly talking about your standard energy sources with the stranded gas or grid, or maybe even some nuclear guys here and there. But we don't have what you have, which is all this Oceaneering information, which I guess like we talked about, like last week on our phone call, it's pretty in depth. And I think a lot of people who are going to be listened to this podcast are going to learn at least a few new things today. So thanks again for joining us.

Harmon: It's my pleasure to be here.

Foxley: Cool, so we'll just start off from the top. And again, like please correct my misuse terms, whether that is gonna happen a few times during the podcast, so please just correct me right off the bat. I won't. I won't take it personally. But we'll start with your background, how you got into engineering, oceanography. And just like your general background within that space for turning to Bitcoin.

Harmon: Oh, yeah. So I guess in a different life, I was a scuba instructor. And I was working in the Florida Keys for a while. And, you know, I witnessed a bunch of coral bleaching events. And then I moved with my wife from the keys out here to Hawaii for again, scuba diving, and then started to see a lot of the same things that I had seen in the Keys. And around that time, I got into Bitcoin and I was able to quit my job as a scuba instructor and go do pursue an undergraduate education at the University of Hawaii Manoa and from there, it was in global environmental science, essentially, oceanography degree. And then from there, I went on, they, you know, they liked what I was doing my research, my undergrad research, I just continued on into my graduate education as a Marine geochemist and marine geologist

Foxley: I did not know you're into scuba, I should have assumed that since like, that's like, your whole background. But as one aspiring scuba enthusiast to another, that's, that's pretty awesome to hear. Tell me about your Bitcoin and academic background. Because we've seen a lot of this happening last two years, where academics are becoming much more interested in Bitcoin, they're realizing that there's much more nuance to the conversation than they were allowing themselves to believe at first. And so they're definitely starting to eke into Bitcoin, let alone also Bitcoin Twitter, it's been cool to see that happening, but get your background would be good.

Harmon: Yeah. You know, like I said, early on, I got into Bitcoin. And then through my graduate education, I built for lack of a better term chemistry, robots and the ocean. And, you know, building those entailed a lot of programming. And I had been into Bitcoin for some time at that point, and, you know, decided to see what the there there was, right? So I, you know, taught myself, C++, so I could read the core repository and figure out, you know, whether it was a scam or not, and, um, turns out, it wasn't, and a lot of what I was seeing, kind of fit the bill for a lot of things that I had been, you know, hearing about the, you know, the climate change. And, you know, I saw that the proof of work provided this incentive for renewable energy that just simply hadn't been there. And that the, you know, the over the over over time, the hash rate would gravitate naturally to renewable energy as the marginal cost of that renewable energy can effectively go to zero, you know, it cost nothing for the sun to shine or the wind to blow or for the geode a therm. So, you know, versus, you know, say fossil fuels, which is going to be op X intensive, it doesn't cost much to build a coal plant. But over the lifetime of that coal infrastructure, you're going to spend more on fossil fuels than you are building it. Where, whereas you know, renewables are the opposite. They're really capex intensive, but their op X is really low. And so I ended up writing this paper and chopping it around to the southwest school in the economics department. In amongst my professors, including Maura Camilo, Dr. Camila Mora, who wrote the famous more at all paper that Greenpeace is touting. And what a lot of people don't know is that, in fact, Maura did not write that paper. And neither did Katie talmidei, who is a close friend of mine, was actually written by an undergraduate class, and it's two pages long. And that's not really known in the conversation. So, you know, Greenpeace and Brad garlin house are out there touting a paper written by undergraduates that doesn't even describe the Bitcoin network. And so you know, from there, essentially, people wrote me off. Nobody really wanted to talk about what I what I described as the the third industrial revolution, which is kind of a riff on Jeremy Rifkin, his third industrial revolution. An industrial revolution, according to Jeremy Rifkin requires the confluence of three separate Technologies, a, an energy source, a communication technology, and a transport technology, and they all kind of work together. So, you know, you can think of this like coal, steam power, and the steam engine and the telegraph for the first industrial revolution, or petroleum, the internal combustion engine and the telephone television radio in the second industrial revolution. And Rifkin describes the third industrial revolution as the confluence of obviously renewable energy as the energy source, the internet pretty obvious as the communication technology, and then he his transport technology is drones. And it relies on a couple of not, you know, not accurate facts. He says, you know, oh, full self driving is right around the corner. Well, you know, Elon has been promising that for how many years now, every year, oh, it's happening next year, and it's still not and it's nowhere close, full self driving is not going to happen. And to be honest, the savings from a drone powered ship are, it's, it's a rounding error, you know, the the crew, which you're still going to have to have the crew, even if it is self driving, which we have autopilot already. So you're not going to get a huge increase there. Most drone delivery programs are being shut down, because they're just not profitable. And there's very little that can't serve as my area. One too windy, too restrictive flying zone, because there's military bases everywhere in Hawaii.

Harmon: And so what I posited in this paper that I was shopping around is that Bitcoin is that transport technology. It takes the renewable energy from where it is converts it to monetary energy, and transports it via the Internet to wherever it needs to go at the speed of light. You know, it's, it's an order of magnitude more efficient than the current financial system. I know I'm probably preaching to the choir on that one. But it's, you know, it is that transport technology, that component, and you can't blame Rifkin for not seeing that it was a he published in 2013. So he was working on that book on that theory, way before anyone realistically was getting into the nitty gritty about Bitcoin. So, you know, I wrote the paper shafted around very little interest. In fact, I got a lot of pushback from it. I was told that I was a scammer and that I was should go work for the Winklevoss twins, I should drop out of school because I can't read I'm illiterate. And they would send me you know, the Digi economist and they would send me I'd be like, well, you know, I know this paper I may have influenced this paper by talking to the all of the authors about Bitcoin, who then floated as an idea to this undergrad class who over the course of a semester you know learns about a subject studies a subject right to paper learns about the publishing process. It's, it's more of an you know, an introduction for these undergrads into the publishing process. rather than producing actual scientific knowledge, and now it you know, it's two pages long. The network they describe even though bitcoin is in the title, the network they described doesn't reflect the Bitcoin network. And it's not to say that the math isn't wrong. Their math is absolutely correct. That, you know, they did a fair job with the statistics and modeling. But any model is only as good as its initial conditions. And the initial conditions that they described, just simply don't reflect the Bitcoin network.

Foxley: Tell me about Blockchain Solutions Hawaii, and what you guys are up to there. And then we'll dive into the energy conversation as well, which I think is probably what most of our listeners are really keen on hearing about.

Harmon: Yeah, so the ocean, our Blockchain Solutions Hawaii was a our is a small company that I founded a while ago, mostly we do side chain work, you know, there wasn't a lot of need for, you know, Bitcoin based industry in Hawaii at the time. So you know, a little bit of there, but I, you know, afforded me, you know, enough of a salary that I could continue, you know, not getting a job, I didn't have to get a job I didn't have to. And so I'd started developing this theory more and more and more, throughout the last years at undergrad, and then on through BSH. And now, one of the things that I had been working on was that theory, the third industrial revolution, and then tying that to Hawaii's energy transition. And what I found was that Hawaii, you know, Hawaii has this goal of 100%, renewable energy by 2045. So I looked around and said, you know, how are we actually going to get there? Realistically, how do we get there? And, you know, everybody says, Oh, you're in you're in sunny Hawaii, right? You just use solar? Oh, turns out that solar won't work. Solar is not a baseload. And, you know, there's a lot of interest in the different energy grids around the country, you know, ERCOT, to Texas. But Hawaii has its, not only is Hawaii separate, a separate grid from the rest of the mainland, each individual Island is its own self contained grid. And so there is no, you know, exporting energy to your neighbor, there is no buying energy from your neighbor, we have to do it internally, we pay 30 cents per kilowatt hour now. And I have I actually have PV on my roof, it saves me quite a bit of money on energy costs, I can run the AC all day. But you know, solar, essentially, if we wanted to replace a single one of our power plants, that provides a third of our energy, we would need a PV farm about four times the size of the International Airport, and there's no room to build extra housing, we have a housing crisis. So we're not going to find for, you know, for international airports on the island of Oahu, I looked at wind and to do the same, you know, replace that same power plant, you would need a offshore wind farm the size of a wahoo itself. And boring. Yeah. So just a nonstarters, you know, they're not. They're not basic, they're not firm base baseload. And so of course, you need, you know, billions of dollars of batteries, and you have to replace all the PV panels, all the batteries, you know, every now every so often. And then you have to redo the entire grid. It's just a non starter from a economic standpoint. And, you know, everybody knows why has volcanoes, right? You see it all the time. Oh, oh, the volcano in Hawaii is going off. So you say you, thank God, well, like I said, the The islands are disconnected from each other. And, you know, while the Big Island may have geothermal, a wahoo, which is the main population Center in Honolulu, which is the city of Honolulu is on the island of Oahu, where 1 million of the 1.4 million people in the state live has no Geo. So there's really no way to exploit that geo on the Big Island to help Hawaii help a Oahu and even if we could, there would be the political palatability of that is just it's just not going to happen.

Harmon: You know, they're mad enough about geo existing on the Big Island in the first place. Then when you start trying to power a wahoo from a neighbor island. That's a no go we there's a lot of animosity between Honolulu and the outer islands. And so I went down the list, you know, nuclear there's no sighting for Nuclear in the state of Hawaii. You know, nuclear is a great option for a lot of places. But the siting is a is a real issue. You know, you have to be at the coast, check, we have the coast, but you have to be away from major population centers, and we just simply don't have that land. There's no way there's no evacuation zones, where a million people on an island, you're not going to be able to evacuate in case of, you know, say, a tsunami, which is a thing that we get here. And hurricanes, you know, so if there was a Fukushima level disaster, we would be in big trouble if we had nuclear. So you know, nuclear works other places. But like most renewable energy, if you consider nuclear renewable, which in general, I do. It's, you know, not all renewable energy is available everywhere. And nuclear just isn't available here. So I'm going down the list. And it turns out that there is one renewable baseload that's available for the entire state of Hawaii and could reliably power the state of Hawaii, way more than 100%. And it's called ocean thermal energy conversion. And it works by just like geo thermal. It's essentially geo thermal from the ocean. But instead of, you know, having to mined down into, you know, dig, dig wells down deep, what you can do is, you take the temperature differential from the surface ocean, in the tropics, where it's nice and warm, I never have to wear a wetsuit here, you know, even on the coldest, windiest day, when I go surfing before the sun rises, I'm not wearing a I'm not wearing a wetsuit, you take the warm surface water, and then you pump up deep, cold water from about 1000 meters deep, which is around five degrees C, and you can run a heat engine. And it's, it turns out that this technology has been around for about 150 years. And yeah, that's so that's what we're doing now with our new company ocean bit energy.

Foxley: So describe to me that the engine process because I have a few questions just based on that itself. So I'm assuming you need some sort of fossil fuel engine to get the whole process started, maybe just for the pump, maybe you can turn it off after that. And then like the cold water itself, how does that provide enough locomotion for an engine? Or to provide enough energy to run something else? Like where's the, the thermal power going in a sense?

Harmon: Yeah, so of course, you know, you're pumping deep water up, so you have to kickstart it right, and you're gonna need some fossil fuel, you need some energy source, whether that's solar, or wind, you know, it doesn't really matter. It's energy. You just have to get the pump started. And once you start pumping, that deep water up, you can run a ranking cycle with ammonia as the working fluid. So, you know, ammonia evaporates at room temperature, and it condenses at above freezing. So you just evaporate the ammonia with the warm surface water, and you run it through a turbine, and then you condense it with the cold water supply. And you're just generating you get net power from that. Just temperature differential, right. And that, yeah, that's, it's really, really not very complicated. It's not nuclear, you know, it's even simpler than the engine in your car. And, you know, if the temperature differential isn't that high, but you you make up for that with volume, right? The, the ocean is very, very large. So, you know, we're talking anywhere from a three meter pipe to a 12 meter pipe, depending on how much energy you want to get out. It's not very efficient, because the temperature differential isn't there. But you make up with that, for that with just sheer volume, you know, at the scale of 100 to 400 megawatts or one of these, you know, larger facilities you're talking about a Niagara amount of water you know, Niagara Falls which is if you've ever been there it's it's an incredible amount of water but yeah, so it's a lot of water.

Foxley: No, that's helpful for I'm trying to like picture this because it's like not I'm from Colorado landlocked state. We don't have that much water. So it's like weird to like, think about what this would would look like. I know previously, another conversation we had you talked about how designing these things specifically for Bitcoin mining and we can get to that Conversation is second. But designing these things takes in a few different considerations. So one thing you mentioned was, you're trying to pipe up this cold water from the depths of the ocean, the easiest way to do it is a straight line between point A and point B. But sometimes you need a landmass. So your line is all skewed. But other times you can float things, and then you just pop it right up to the surface of the ocean that way, like, traditionally, how do we see these sort of things deployed? Or are they necessarily deployed all around Hawaii or, or other places?

Harmon: Like I said, it's a technology that's been around for 150 years, there have been a number of plants that have been built in the past, there's one here on the Big Island of Hawaii, at Nell Ha, the Natural Energy Laboratory of Hawaii, and it was 100 Kw testing facility. And, you know, it's a land base. So there's two, like you said, there's two designs, there is land based. And then there is a offshore floating facility, moored, more floating facility that you you know, have a single cable running back to land a power cable. And, you know, there's design trade offs are both, you know, land based, you have land use issues, getting like you said, the pipe is going to be a lot longer, you have to get down to 1000 meters. So you have, you know, that slope, versus if you, you know, more offshore, here in Hawaii, it's about 10 kilometers offshore, you can more it and just run the pipe straight down. And you know, the piping obviously costs, the larger the longer it runs, the larger it is. And if it's on land, there's environmental impact, because you're gonna have to lay it over, you know, coral reefs protected, you know, marine areas. So there's considerations there. But yeah, the offshore one is, you know, once you start getting to scale, it makes a lot of sense to more than offshore. And there have been a number of plants built over the last 100 years, I think the first one was built in the early 1900s. One was built in 1935. And one of the problems with these things is that, well, they're in the, you know, the tropics. So you have hurricanes. And I think both of those were destroyed by hurricanes. They were land based, and they were destroyed by hurricanes. And then they're, you know, there was a push to rebuild the one in 1935. But then 1938 happened, and we discovered oil in the Middle East, the largest deposit on earth, and that it kind of killed all renewable energy experiments. Almost overnight, you know, when they found cheap, fossil fuels. And so now there's, there's talk about building one in Santo May, one a 1.5 megawatt plant in Santo May, there was a one megawatt demonstration facility built here on a wahoo back in the 90s. But, you know, for the most part, for the last, you know, since the 30s, all OTech has been experimental, just testing, because, like, most renewable energy is a economy of scale. So, the smaller you build, more expensive it is, and in order to build the large ones, which, you know, you're getting down to, you know, six cents, or below per kilowatt hour, you have to build in the middle. And this is what's called the innovation valley of death. And it's been the, you know, the economic problem that has always plagued OTech you know, we know it works at, you know, we know that the, in general, the ranking cycle scales scales up really well. And we know that we can do it, you know, at a small small range, but the problem has been, how do you build in the somewhere in the five to 20 megawatt range and have it generate capital? Cuz, you know, hooking it up to land, you're looking at costs of 50 cents per kilowatt hour or above, which is that's a non starter. No one's gonna buy that energy. So it has essentially been Oh, you know, you can spend a couple 100 million dollars build one of these things with off the shelf commercially available, you know, material and essentially just Take a bath on it. But just to prove out the technology, nobody's been willing to make that bet. And that's kind of where I came in. Yeah, I floated the idea that coin, Bitcoin solves a lot of these problems getting us through that innovation valley of death.

Harmon: Because, one, a lot of the, you know, a lot of that capex, for one of these five, say, five to 20 megawatt power plants comes from connecting it to land, you have the power cable itself, 10 kilometers of, of, you know, cabling is gonna run you anywhere from 40 to $100 million dollars. If you don't connect it to land, save that, right? If it's not connected to land, well, now you don't need to mourn it. If there's no mooring, you don't have the, you know, and it's just floating, you know, moorings cost 10s of millions of dollars to install. There's all sorts of permitting involved, because you're, you know, mooring something outside your mooring something to the bottom of the ocean. And if it's not moored, there's no reason to necessarily have it in Hawaii, Hawaii is at 21 degrees north, and OTech works from 23 degrees south to 23 degrees north. So we're at the, you know, the outer limits of where OTech works. And because this is a heat engine, it works based on the temperature differential. So you know, here in Hawaii, we have about a 20 degrees C temperature differential all year round. And but you can find higher, there are blobs of the ocean that are around 32 degrees Celsius. So five degree you know, that's a 27 degree, you know, temperature differential, so you're increasing the efficiency of the energy generation if you go to the blog, but that blob happens to be in the middle of the ocean at the equator. One of the good things is that if you build at the equator, you don't have to worry about hurricane. So, you know, whereas a lot of the cost of these facilities in the past was Hurricane proofing. And they kept getting destroyed by hurricanes. Well, you don't have that problem at the equator. But the problem has been who buys your energy in the middle of the ocean? Why there's never been a energy consumer in the middle of the ocean, you know, fishermen need energy, but not that much. They're not going to come get it. So who who buys that energy? And the answer is, of course, Bitcoin.

Foxley: The Bitcoin network is the buyer there, which is, which is pretty cool. So I'm trying to picture what this would look like. To me, it's just a barge, they float out somewhere. And it have a bunch of containers on it. ASICs, just like we see with stranded gas or other facilities that are in remote areas, you have satellite beaming up and down blocks. And then you have the thermal engine on there, too. So how would that picked, like, give me an engineering perspective, or a schematic of what this would look like and how you would deploy it.

Harmon: I mean, that's exactly right. It's a bunch of containers see fastened to, to a barge, and you tug tow it out to the middle of the ocean. And then once you're out there, you drop a you drop a giant pipe, essentially a straw over the, over the side of the barge, just and then you start running the pumps. Once you start running the pumps, you can start generating energy. And what you can do is you can you can actually use the you know, there's a lot of water so there's a lot of wastewater, what you can do is you can use that wastewater, which is five degrees Celsius for cooling the miners. So you've cool the ASICs included with the energy you know, there's no extra cost for cooling the miner So obviously we're looking at immersion mining, we can, you know, we can get the PU e the power use efficiency of one of these systems down to one so 100% of the energy that's being generated is just going straight to Bitcoin mining, there's no other considerations and then even more so you can use the outflow of that cold water supply for dynamic positioning. So you're not burning fossil fuels to move the vessel because you know as the Sun as the Earth goat travels around the Sun, that heat blob moves north and south out, depending on, you know where we are during the year, right is the northern hemisphere tilted to the sun, or is the Southern Hemisphere tilted to the sun. And you can just track that heat blob year around because you're not tethered to anything. And you can use the outflow of the cold water to do that. And then even further use for that cold water is that the way that the global ocean currents work, there's the thermo halen circulation, which transports heat around the world. If you're on the East Coast, you know it as the Gulf Stream. It's why it's warm, at the it's warm on the East Coast. And, you know, it's cold on the West Coast, right? You know, even in the summer, it's really cold water on the West Coast of the US. And so as that water travels around, it also sinks down deep. And as it's traveling underneath, you know, not at the surface, right, the oceans pretty deep, and there's multiple bodies of water and they all travel around the world. It accumulates detritus from the rains down from above. So nutrients, essentially, nutrients rain down, and they accumulate in these undersea currents. And so as we pull that cold, nutrient dense water up, if we release it at the surface, you can generate primary production. So you know, little tiny, microscopic plants, you know, phytoplankton, you can stimulate them to do what plants do best, suck carbon out of the atmosphere, and then when they die, they rain back down into those deep ocean currents. So you can tie the cold water supply into three things, cooling the miners, moving the ship, and then carbon capture and storage. And this has been the, you know, the missing piece, right? For OTech. For the longest time, people have been trying to pair you know, multiple processes in to OTech, to make it to make it financially viable. So they've explored hydrogen production, ammonia production, desalination. But those all have efficiency losses, right? Doing all of those have efficiency losses, versus while we're doing it is as efficient as possible. And so, by this, we felt, we figured out that we can actually make this financially viable, you know, even at the 10 to 20 megawatt five to 20 megawatts scale, we're looking at, you know, somewhere in the range of 10 cents per kilowatt hour, which is expensive, in general, for mining, you know, if you're used to hydro at four cents, but with a PU e of zero of one, this makes it you know, you're looking at an ROI where traditionally you've had a complete financial loss. So it's not the you know, at that, that middle scale, it's not the most efficient yet. But then once you if we build this 10 megawatt containerized grazing platform

Harmon: And run it for a certain amount of time, you know, say to 2.5 years, you prove it, prove it out, prove the technology out at sufficient scale. And then you can start building 100 megawatt 100 to 400 megawatt platforms. And these can then of course, power, large, large metropolises around the world. There's about a billion people on planet earth that can use this energy source. And you know, at that scale, you're not really worried about hurricanes as much, you know, the oil platforms do just fine, right? It's the small stuff, you know, the smaller you are, the more vulnerable you are to the hurricanes, and, but the larger you are, stops mattering as much, you know, their shell, they do a pretty good job. And that's, you know, that's the end goal is 100 megawatt OTech. It's, there's an entire ocean of energy that nobody is talking about. You know, it's anywhere from two to four terawatts of energy are available through OTech alone. And I mean, if you build 100 megawatt can take a floating grazing platform, just like the 10 megawatt you're looking at sub four cents for energy costs, you know, per kilowatt, and again, the cooling is still included. And as is the carbon capture and storage so there's you know, car you can sell carbon credits or some bullshit I mean, it's a If, and if you start pushing it past four terawatts of, you know total supply, you start actually cooling the ocean, which may be, you know, necessary in the future, you know, cooling the surface as temperatures start to hit ramp up, cooling the surface ocean may be something, I'm not a huge fan of geoengineering. But it may end up being something we actually have to do. And this could theoretically, cool the ocean. And then they're even more there are trillions of dollars of rare earth minerals contained in these manganese nodules. They're essentially these balls of metal that are just sitting on the the ocean floor exposed, they're not buried their balls of metal, you know, the size of the head of lettuce.

Foxley: Wait, back up a second...

Harmon: Yeah, it's, it's so ridiculous. manganese nodules, they're all are millions of square kilometers, that are littered with big balls of metal, they're manganese, cobalt, copper, nickel, iron, rare earths lithium, and there's trillions of dollars worth of these minerals, there's more. There are more reserves of these minerals in these these regions, these balls of metal sitting on the bottom of the ocean, than there are available terrestrially. And one of the big problems of going to get them is energy source, you know that you have to essentially build the fancy version of a vacuum. And you have to suck these balls of metal from 4500 meters below the surface. And it sounds it sounds so ridiculous, but

Foxley: It sounds like a looney tune or something. It's crazy.

Harmon: But of course, you know, mining Bitcoin in the middle of the ocean is totally rational, right?

Foxley: The ocean is cool.

Harmon: The ocean is this incredible source. I mean, it's the you know, the source of all life. And the reason why these, you know, you ask yourself, why are there these big balls of metal on the bottom of the ocean? Well, there's no inputs from above. So they're in, they're in essentially a giant ocean desert, right? The, you know, the Sahara equivalent of the ocean, so there's no, and the bottom, you know, the sea floor. There's different types of compositions, but the composition of the seafloor is dependent on the inputs from above. And because these are in essentially the, the ocean desert, there, there's no inputs from above. So the only thing that's happening is you get this accumulation over time of the metals that are just floating around the ocean. So it takes, I think it takes about 10 million years for each centimeter for these balls to grow a single centimeter. So they've been around for, you know, sitting on the bottom of the ocean floor for 100 million years with no inputs, because normally these, you know, these, these metals are still present, you know, when you you know, when you're looking at mud, or you know, silty or, you know, coral based substrates, they're just buried underneath everything else, but because there's nothing to bury them, they just accumulate slowly. I mean, I don't know if you have your if you're able to look it up, but if you look up manganese nodules and pull them up, you're gonna see these big balls of American metal right now, it's so ridiculous. But um, no, it's one of the many wonders of the ocean and, you know, they're the mining rights have already been sold off. You know, this has been something we've known about since the 60s actually work from the University of Hawaii help discover these things. We got a we got a building built because of the discovery of all of this.

Foxley: Okay, well, I have to get an image up from the for the YouTube channel, because this is it's weird looking. It's not exactly how I imagined it. It makes more sense now, but yeah. What I was imagining was like, very different from this.

Harmon: Balls of metal. Yeah. And one of the major problems was getting them is that is the power supply in the middle of the ocean. And it turns out there in the four major regions for these manganese nodules all happen to be in the OTech region. And if we want to, you know, if we Want to lean on solar? If we want to lean on intermittent sources of energy, which we're going to have to the question is whether, you know, do we continue to do business with the Democratic Republic of Congo? Where, you know, cobalt, their major cobalt region? Do we continue to destroy the Congolese desert? Right? Do we are not desert rainforest? Do we continue to strip mine the rainforest? And, you know, use slave labor? Or do we go pick up these balls of metal that are just sitting on the bottom of the floor? And we're going to, it's not a matter of if we go get them, it's a matter of when and you know, they have variable power needs out in the middle of the ocean, when they're mining these nodules. And Bitcoin provides that demand response. So you have the OTech system powering, you know, once they're out there powering using it for dynamic positioning, and then you have Bitcoin mining sucking it up. So there is another energy consumer out there. But we have to get to that scale first. Yeah. And that's and so we have to do 100% Bitcoin mining operation, about 10 to 10 megawatts is what we're looking at.

Foxley: Yeah, how we put a bow on this part of the conversation. So Bitcoin mining operates as a monetization tool for for getting this off the ground random stranded energy. That's right. And then it also operates as a user of this energy when you're not vacuuming up all this all these nodules off this, the seafloor - is that right?

Harmon: Yeah, it's, you know, because the PUE is one, a lot of the regions that can use OTech also have access to solar and wind. And so what you do is, you know, in order to do the, you know, the the calculus on whether you should build a new solar farm or wind farm, you know, you have to, it becomes much easier if you can essentially sell 100% of that energy, you don't know when it's going to come. But if you know that you can sell it so you centralize that curtailment, you know, the waste energy to the OTech plant. You know, if it's connected to shore, you know, like a large one connected to shore, you centralize that curtailment to the OTech plant, so that everybody is guaranteeing 100% of their energy being used. And, of course, OTech is the most efficient way to produce Bitcoin.

Foxley: This is wild, this whole conversation, I'm going to be like, deep on Wikipedia tonight, looking at manganese nodules, which might be my favorite new phrase that I've come across.

Harmon: It's the ocean and the ocean. And just not theirs. You know, where everybody's talking about space. They're like, oh, let's go mine. Let's go mine asteroids, we are 100 years away from that. We have to go to the ocean, we have to go to the ocean before we even start thinking about space. And, you know, these nodules, and there's of course environmental, you know, issues with, with OTech. But it's, you know, net net negative carbon. There's some there's some there's a question about the noise and noise at sound attenuation. There's some issues with you know, obviously, if you if you have a moored facility and you're releasing a bunch of nutrients, you can get eutrophication. So you if it's more, you really don't want to release all those nutrients at the surface. But if you're moving around, that's not really an issue. And a lot of these, you know, environmental issues get cleared up when we start building it, you know, the 10 megawatt 10 megawatt size, do a lot of research.

Foxley: Yeah, okay, that kind of cleared up. The last question I had for you is the downsides of this, the hidden costs that we might not know about, maybe there's some more we can get into for a second. And then what scaling looks like for Bitcoin mining, especially because I haven't heard of anybody else doing this. And I'm wondering from your personal experience, if you're raising funds for this, how you're like pitching it to people, or how you're expressing those because you'd like you said, it's a it's an older technology, it's over 100 years old, bringing the Bitcoin component to it, and you can monetize it and get through that death zone as you as you say it so what does it look like to address those downsides is probably a better way of framing my question.

Harmon: So yeah, we're we are raising, we're going through a seed round, starting in June one. And our first thing we want to do is we want to the the 100 Kw plant here on the Big Island in Hawaii. It's actually been mothballed for about three years Um, they it was mostly built for testing heat exchanger. So our partner Mackay, ocean engineering, who built the plant, they, you know, OTech development hadn't been really something anyone was pursuing. So they migrated into the peripheral industry. So heat exchange and sea water, AC. So this, you know, it was the first grid connected OTech plant, ever, it's the only one in the world that's grid connected. And so they were testing their heat exchangers for use in the F 35. You know, the new fancy new awesome planes. Once that testing was done, a ranking, there's nothing to test with the OTech it's there's not the tech, unlike other, you know, technology, there's not the technological risk, I think you were alluding to that there's not the same technological risks that you have with say, you know, rockets, rocket, rocket science. But, so what we want to do is we want to raise an initial seed round to restart that renewable energy plant, and do a full scale integration with 100 kW, you know, you're essentially show that we can get down to a PUE of one, which would be a huge feat. And then, of course, you know, you generate a PDF press release, saying, oh, Bitcoin mining is restarting push for renewable energy, blah, blah, blah. And on the back of that we can raise, do a Series A, to build a containerized version, it's about 250 kW and a single container coupled with 250, kW of ASICs that, you know, we can use to test that we can use for, you know, essentially a prototype to scale it up to the the 10 megawatt, you know, tested at 250 kW. And then we can scale that up to 10 megawatts, so that a 10 megawatt would be our series B. And then from there, you know, once we, you know, there's proof points along the way, you know, you show the show that it works at each point, you do a raise to build the next point, and then you get, you know, containerized, 10 megawatt OTech product that you can then deploy on islands around the world you can deploy on, you know, for, for manganese nodule mining or just for mining in the middle of the ocean, you know, that's a viable use case. And you're proving out the technology all along the way. And, you know, taking this thing, it's been around forever, finally, getting it to scale to where we can, you know, provide renewable energy, zero carbon source of energy to around a billion people. But that's a long, long way off. And you, you know, you do all the research along the way I have connections here at UNH, where Sea Grant University, I've done research myself, with you, ah, and so they're interested in if we can get to 10 megawatts and go out there in the middle of the ocean. There are half a dozen research projects, you know, PhDs are coming out of this. And you know, show it at scale, you just prove out the technology. Figure out the kinks along the way.

Foxley: Yeah, I don't really know how to close this podcast, because it's not what I expected. Did not expect to learn the word maintenance manuals. So she was gonna say one more time, is that really enjoying it? But I want to thank you so much, Nate, for coming on the podcast. And we'll have to have you back on again soon to talk about progress as you get through the seed round and, and hopefully later to deploying this will also have to get some videos from you. Yeah, maybe I can come out to Hawaii sometime. The go scuba diving together, you can show me a few tricks.

Harmon: I guess one thing we didn't even mention was jurisdictional arbitrage for the middle of the ocean. Oh, yeah.

Foxley: I tweeted about that the other day, international waters. There you go.

Harmon: You know, you can pick and choose what jurisdiction you know, whatever flag you're flying. Um, yeah. So you don't have to worry about, you know, what you guys are what's happening with you guys. Like I mean, it's a terrible situation. But you don't have that same concerns. And, of course, there's the the opportunity for seasteading. Right. Yeah. You know, the seasteading movement is large and the community and again, they don't have a viable power source to go live in the middle of the ocean. So this can provide a viable power source for that. So you could you know, the Citadel right?

Foxley: The Bitcoin Citadel, yeah, biotech. Nate, where can we find you on Twitter? Do you have website or blog or anything?

Harmon: Sure. Yeah, so Twitter, we are @BlockchainHI1 I won the number one. And yeah, the BSh website is for other things. So and we're working on. Yeah, just Twitter. Twitter's the best way.

Foxley: Twitter, like everybody else. Okay, cool.

Hosted by Will Foxley