The Canadian Bitcoiners Podcast - Bitcoin News With a Canadian Spin - The CBP - Taras Kulyk, Founder & CEO of SunnySide Digital

Episode Date: June 6, 2024

FRIENDS AND ENEMIES This week we welcome Taras Kulyk, the founder & CEO of SunnySide Digital (https://x.com/SunnySideAsics). Sunnyside Digital is a Toronto based company is a wholesale distributor of data center and digital mining hardware and infrastructure. As bitcoin mining continues to grow, so does the cost and complexity of the operations. Taras will help break down the process and hopefully give some insight into a different side of bitcoin mining. From a couple of Canucks who like to talk about how Bitcoin will impact Canada. As always, none of the info is financial advice. Website: ⁠www.CanadianBitcoiners.com⁠ Discord: https://discord.com/invite/YgPJVbGCZX⁠ #Bitcoin #bitcoinmining #ASICs A part of the CBP Media Network: ⁠www.twitter.com/CBPMediaNetwork This show is sponsored by: easyDNS - ⁠⁠⁠https://easydns.com/⁠⁠⁠ EasyDNS is the best spot for Anycast DNS, domain name registrations, web and email services. They are fast, reliable and privacy focused. You can even pay for your services with Bitcoin! Apply coupon code 'CBPMEDIA' for 50% off initial purchase Bull Bitcoin - ⁠⁠⁠https://mission.bullbitcoin.com/cbp The CBP recommends Bull Bitcoin for all your BTC needs. There's never been a quicker, simpler, way to acquire Bitcoin. Use the link above for $20 bones, and take advantage of all Bull Bitcoin has to offer.

The Canadian Bitcoiners podcast is just two guys and maybe a guest or two discussing Bitcoin, Bitcoin equities, and the related macroeconomic space. It's not meant to be financial advice, so please, if you're doing any investing, after listening to our program, do your own research, do your own due diligence, and understand that any money you invest can be lost. The show is meant for entertainment purposes only and we hope you enjoy the program. Friends and enemies, welcome to yet another edition of the Mighty Canadian Bitcoiners podcast. I'm Len the Legend. I'm flying this one solo today. Joey has the night off again and I think he's got it off again next week. Good for him, but either way, he's got to recharge his batteries because he's been doing a lot of the legwork recently. But that's enough about Joey.

Let's talk about this show because I have Paris coming on in just a few minutes. And there's going to be a lot of discussion about integration of mining and industrial sector. This is something that's becoming more prevalent these days, and it seems to be more of a heated discussion. And I want to talk to him about this and dive deep into this, and hopefully you'll enjoy this show. But before we go any further, there are a couple of ad reads I'm going to have to do. And you know the drill. Let's do it again. The first ad read is going to be EasyDNS. Now, EasyDNS, I've talked about it numerous times they are the gentlemen the group of

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satoshi wanted you to do open an account if you haven't already done so use our promo code below if you do that fund your account 21 bucks will be added to your account so with that being said let's bring in the man of the hour terrace i want to bring him in and we can discuss a lot about Bitcoin mining, because this is a topic which I rather enjoy talking about that. But before we go any further, how are you, buddy? I'm good, sir. Busy, busy days for sure. It is. Well, before we go any further, because we have a jam-packed discussion I want to just pile in tonight and the amount of time we have here. You have an interesting background because you've been an investment banker,

so you've been working neck deep in fiat. And so BMO, I see if you worked with them, you worked with TD Securities in the comms, media, and technology team. So there's a little bit of a lot of fiat you've dealt with in the past. But now you have this company that you founded, and you're a CEO, Sunnyside Digital. I want to hear the path it is that you took from the world of fiat to the world of Bitcoin mining. Well, that's a great question. Actually, during my MBA program prior to getting into investment banking was the

first time I got to hear about Bitcoin this was 2012 2013 2014 because I graduated in 2015 there was actually a buddy of mine in the in finance who I look back and guy was a freaking genius because he's like hey to, to us, you gotta, you gotta put your money in Bitcoin. Forget about your student loans. You gotta put all of your money into Bitcoin. I'm like, nah, I gotta make some money and pay down my student loan because that thing hangs over your head like a specter. What happens to you? You can't get rid of student loan debt.

So I did the reasonable thing as a finance guy. And I basically worked to pay down my debt instead of buying Bitcoin. He was buying Bitcoin at $200, $300 a pop. And let's just say that guy's retired at this point. So good for him. But that was the first exposure I had to Bitcoin in a formal basis. Uh, but after school went into investment banking, um, and really enjoyed it for a while. And then. I got to the point where I kind of got bored doing the wanker banker thing, which is, you know, going hustling, trying to build a good deck, build a good M and

a model, building the financial statements and having a good presentation and pitch to get like the decision makers that are your actual clients to pull the trigger on deals. I thought it was a great learning experience being able to build up a financial model, but I thought real value creation was an actual building company. So I left, got into a company called Decentral,

which was based in downtown Toronto, founded by a guy named anthony diorio one of the co-founders of ethereum yes and i was there for about five months and then i got a call from a headhunter who was working for a family office that was looking to build a data center company uh in antigua. So this was a Canadian online gaming billionaire who, when I first started with that role, they had 6,000 servers in operation. And after I was there for about two and a half years, we ended up having 330,000 servers in seven countries. We had a team of 21 people.

I ended up becoming CEO of a public company. We decided to do a run at with the change of control of the board of directors. A company called was called Squire Mining. So our pitch was initially to roll up a bunch of data center and digital mining companies. But it pivoted because someone had the great idea, not so great, to basically develop their own ASIC chip and ASIC system. So that's one way of burning through quite a bit of money. And that's basically what happened. A lot of work, a lot of effort was put in and eventually we burned through, I think

it was 20 million bucks. Our tape with Samsung did not work. I went to South Korea, got a bunch of engineers kicked in the shins and came back and was like, honestly, the design wasn't what we thought it was. And there's, you know, disagreement of opinions. And I was given a nice offer package and resigned and came back to Canada. So I spent about a year advising like early stage tech companies in the digital asset space, exchange space. And then one of our partners who I was working with when I was in Antigua called me, Core Scientific.

And they're like, hey, we're looking for a biz dev guy to kind of run and bring in our, bring in our business. And because we had done a ton of deals together, I was one of their largest clients, knew the entire team, the shareholders. And that's how I became a head of a gravity generation for, for core scientific back in the day. So I was there for about two years and four months. Did 2.3 billion in total contract value and like initially hustling hardware,

but then primarily like setting up hosting agreements, partnership agreements. We worked with the guys in ADQ, set up one of the first pilots in the UAE region and generally just tried to help build up the ecosystem. Worked with guys like Michael Saylor and Darren Feinstein to create the Bitcoin Mining Council. So I did a ton of work on that. And then there came a time where I'm like, listen, some of the decisions that were being

made didn't necessarily agree with. And I thought it was a good time to basically transition. And so I took an offer from a company, as we were chatting about earlier, called Validus Power. didn't necessarily agree with and i thought it was a good time to basically transition and so i took an offer from a company as we were chatting with earlier called validus power yeah because i still think the thesis of bitcoin mining or digital mining as well as the general data center ecosystem converging with power generation uh is gonna happen i mean uh there's all sorts of discussions occurring right now about energy and the energy demands of data centers generally. I think it's a no-brainer for the data center

ecosystem to be the off-taker first resort for power generation globally. Anyways, I was there for a while. There was a ton of stuff that happened before I joined that I wasn't aware of. I put in a solid nine months and when the writing was on the wall, I decided to take what was originally a side hustle where I was helping place ASIC hardware data center infrastructure with clients and I turned it into my own company. So I left Validus and started Sunnyside Digital. It's been about two years, two and a bit years, and we've been growing. We've got a ton of business. We work with most of the pubcos out there. We've got a team of 17. We're looking at some M&A activity, and we're actually developing

a real focus on HPC, helping move GPU hardware, racking, transformers for that space. And eventually, over the next few months, we'll actually be starting to build our own HPC data center capacity. Because my commitment and promise to the digital mining space is I will not compete on the Bitcoin network for hash rate because I continue to sell to everybody. It's not an asshole. There's a few but I work with most of the ecosystem, but some of the folks I just won't work with anymore.

And I won't compete with them on the Bitcoin network. So I don't mine as a business. If I have to, because we're buying some liquidation or we're helping somebody out, or we just need to park units with someone as they sell through the inventory, we'll do that. But our business is in hardware, we're pickaxes and shovels, providing services and solutions in a reliable way,

you know, based out of Canada, but with some M&A, we'll likely be based in the U.S. over the next few months, actually. So there's a lot to chew on. I have one question. I actually got a few questions. So I'm going to double back quite a bit. Now, you were talking about one particular moment in time. You were involved with a team that was going to be developing your own ASIC

chip and system. Yeah. I find to be rather interesting. I would imagine that was at a time when the S nine probably was the king of the world. I think it was like S 15. This was 2017 2018 2019 yeah so the amount of capital required to to get something off the ground must have been tremendous

so realistically how close were you to actually having something i know you said you went to Samsung and things didn't work out. But if you had access to significantly more capital, were you almost there? I mean, if the focus was there, we could have developed an ASIC chip. But the principles that we had worked with that funded that were basically like one and done after we had burned through um i came back with a report that was not very favorable towards our partners

overseas um and after that i resigned and you know i think they basically put their tail between their legs and tried to pivot the company to do other things proprietary mining and other things but honestly once i left i think that a lot of the initiative uh was was lost um but i was there to help try to clean up and sometimes you can get it to be clean sometimes you can't you're going to take your losses once in a while learn that's what you've tried don't repeat them exactly you know move on with your life exactly that core scientific that you have you had a very strong correlation or association with them given that you were um with them for some time what are your thoughts on what happened with them because they for people are unaware they were at one time the largest or one

of the largest publicly traded bitcoin miners and um aggressively took on debt and the cost of that went up and they had to declare bankruptcy so that's just the gist of it but i want to hear your thoughts um of what happened over there what like what's uh what's your story of that that well i think uh core scientific is still right now one of the largest by operations data center operator in the Bitcoin mining space and now increasingly so on the HPC side. But it was a classic case of treasury management or lack thereof. You know, there was a lot of enthusiasm towards how Bitcoin had been spiking, had been running up. We had a treasury of over 6,000 BTC. Like we had oodles of assets, but we also took on debt aggressively.

And, you know, one of the things that will never leave my mind is being an ex-wanker banker and trying to be a little bit more conservative. But sometimes success needs risk. Sometimes it needs risk controls. And that's really what happened. I mean, I, you know, lost a bit of faith in what the decisions were being done. And so that's why I stepped away because I was just like, you know, you put your hand up and say, Hey, guys, you know, there's a fire, there's a fire, there's smoke, like, let's deal with it. And it's like, hey, stop, stop talking about this is not your deal. Eventually, I'm just like, okay, well, if you're not going to even take my opinion, or take any advice I have, I'm, you know, I'll go do something else. And

that's basically what I did. I got an offer that came out of the blue and that kind of accelerated the thinking of, okay, maybe I need to go do something else and learn about the power sector, which is extremely interesting to me to this day. And we'll touch on that in just a moment. Before I change, sorry. Core Scientific now, Adam Sullivan and team Russell Kan, crushing it. They are extremely undervalued given the size and scale and efficiency and performance of what they're doing the market's still not reasonable in their valuation they should be like a 2x right now and it's i'll be honest it's a big component of my personal portfolio not as big as bitcoin but i am very bullish on core like those guys are doing the

right things and uh nothing but good things to say about Adam Sullivan's leadership and what he's been able to do with that ship. So I think it'd be a really good story. So then you're familiar then, oh, it looks like you're a Ryerson alumni. Oh yeah, hey, Ronnie, nice. So CoreWeave, I'm not sure if you,

I mean, you must have heard this. They made an offer to purchase some or a lot. I don't think that's real. Actually, when I was at Core for the two and a bit years, I was the account manager for CoreWeave. They were our largest GPU client as we were hosting and managing GPUs as part of Core Scientific's hosting business. Right? So Mike, Brandon and the guys, they know their shit when it comes to GPUs and managing fleets at scale.

So the fact that they've gone from a $50 million valuation to 20 plus billion, man, those guys are crushing it. I have nothing but good things to say about CoreWeave. I can only hope that we can get into their ecosystem and work with them again because I have nothing but good things to do and say with those guys. They're really an inspirational story for folks that are geeking out on hardware like I am on a daily basis because, man, you do things right and eventually the market recognizes it. So really the question, I mean, I'm not sure if you could answer this, but I'll ask you anyways. I'm wondering how could they leverage that position if indeed this offer is legitimate and it's not false,

this CoreWeave offer of buying some of Core Scientific? Because CoreWeave is an AI company. It's in HPC. So I'm trying to connect dots here. How does a company that has a crap load of ASICs pair up with an HPC-type company? What am I missing here? Well, ASICs need managed services,

and they need large-scale data centers. The new generation of GPUs, like the H100s, H200s, their power density is getting closer and closer to existing digital mining power densities, meaning that traditional data centers, they aren't really suited or prepared to handle the amount of power requirements that new generation GPUs need. So NVIDIA has actually put out even newer hardware that's going to be even more power dense,

like the Blackwell series of GPUs coming out. And so what we're seeing is this convergence of traditional HPC, AI generative compute getting closer and closer to Bitcoin mining power densities. And again, Core Scientific's original pitch to the street before Kevin Turner left was that it was going to be a dual phase business where it's going to have an AI compute traditional data center business in addition to Bitcoin mining. When BTC ran like crazy, the AI side was actually sold off and more focus was put on Bitcoin mining. In hindsight, it may have been better to actually stick on a dual phase business model. But, man, you can't you can't look back on history like that. Right. But to answer your question directly, Core has existing data centers that can be converted to manage HPC workloads not easily but very rapidly right so one of the things that they announced with core we've this week on the other believe on Monday was a 200 megawatt HPC

partnership that's going to convert some of the higher quality existing data center capacity into HPC racks, which requires power redundancy, a lot more higher throughput, lower latency fiber, much more stringent HVAC requirements. Because when you have a ASIC that goes down 5%, no one cares. I mean, 95% uptime on a Bitcoin mine, you're like, that's fricking golden. On HPC, you want like 99.9999% uptime. That's what you're paying for with traditional HPC and AI compute requirements. Right? And Core, with the experience that they've had, because they've managed GPUs for, you know, almost a decade now,

they have the internal technical expertise to actually do this in a high enough caliber way that Core, which is now a leader in AI compute, looks at Core, knows the team, knows the business, knows the technical chops, and is like, this is a no-brainer. So they're vertically integrated. They own their own power generating stations. So they're able to... Yeah. Or did it power generation station, but core was one of the first in the space getting access to power grid connected with redundancies. So they actually have some of the most stable power in the US right now. Got it. In terms of being profitable or enticing enough to get into that it's something to get into hpc more advantageous

than say bitcoin mining because you can almost plot out uh bitcoin mining in terms of the profitability within the next few months because you know we don't know what's going to happen a few months after that but with respect to in uh the amount of money you can make in HPC is discomparable. Is it better in HPC in terms of ROI? I don't know. I think the way I look at it is I like to have a dual business where my target is to have a 50-50 business between

HPC, hardware, compute, managed services, and 50% Bitcoin mining. I mean, Cathie Woods, 2 million minimum BTC price in the next years, you know, Galaxy, Novogratz, like a million within the next year and a half. I mean, my guess is we're at least 100k by the end of the year, if not 150. But if that changes, and we hit, we see the same type of percentage increases, as we've seen the last few having epochs, we could be much higher.

And at that point, all bets are off when you're talking about an internal rate of return, right? So to be able to speculate on which is a better investment proposition, I can't do that. Got it. It's really, I'd like to hedge my bets and say they're both fantastic lines of business. Both require patience and capital. But at the end of the day, I think they're both exciting hardware-based businesses that honestly I geek out on every day. Something else you were involved with was the creation of the Bitcoin Mining Council. What are the goals of this? What are you trying to achieve and what has been achieved to date? Well, the Bitcoin Mining Council was originally

formed as a response to some of the stuff that Elon Musk was saying about carbon-based generation that feeds the Bitcoin mining ecosystem. Elizabeth Warren, the crazy person, DeVries, who basically makes up facts and makes up, like just lies straight up about what Bitcoin mining is doing because of his own political agenda. So our goal and what we did, and I think we were successful at it, was essentially aggregate information

that had never existed before, voluntarily from large scale and small scale as well, miners on a global basis. Like we had at the peak 55 different miners submitting data on a quarterly basis that we were aggregating just to make sure that the data is out there. It was fully anonymized and obfuscated to make sure that miners who historically been extremely sensitive to sharing information i knew that it was like folks on the inside of the ecosystem not going to expose

their private information we had pubco submitting info but the most important was just getting the data out there like most of the power that bitcoin miners are using is renewable because it's cheaper although it's intermittent it's cheaper it Although it's intermittent, it's cheaper. It's in places where people don't really have big population centers like Toronto. So it's a ridiculous conclusion to think that Bitcoin mining was powered primarily by carbon where the cheapest power on the planet is renewable

because generally where you build renewable, there's no offtaker. So Bitcoin mining moves in and supports renewable power. Like that's really the crux of what we were doing with the data collection and the surveys. Luckily, we've actually been able to hand over to Cambridge, Alexander and his team at the CEBSCI. They're actually releasing the first survey

to start collecting the data and we're handing over the reins so that people are like no it's just a bunch of bitcoin miners putting their data no this is cambridge university that's going to actually be doing the surveys collection and disseminating the data once they actually put it out with their academic record stamp i'll be helping them because i think it's the right thing to do for the ecosystem but the bitcoin mining council is essentially wound down its survey so that it's handed over to an appropriate academic center for, you know, general population to say, okay, we may not trust Bitcoin miners to put out data about themselves, but we will trust, you know, a very renowned academic institution to

do so. Now, do you think that enough was done because i'm looking at for example in the past few years elizabeth warren you mentioned as one name and she's still going out there with her anti-crypto army number one and the second one we had just i think last year earlier this year i can't remember but it was greenpeace teaming up with ripple and they're talking about changing the code transfer a bitcoin's proof of work to something else probably proof of stake which would be far less energy intensive but good thing that hasn't been picking up much steam but so with respect to that you think that the bitcoin mining council was successful in achieving their goals given the fact we had these episodes in the past few years

a hundred percent we i know for, we changed the channel with many international institutional investors. They were, we actually had emails come back to us saying, thank you. Like this information statistically verifies what we thought was the case, but you've actually provided us a data set that we can actually review and work on now to know that you aren't boiling the oceans and killing us. It's actually done exactly what we wanted it to do, which is put the information on data and get people thinking about what the reality is versus what the zealots like Warren and Greenpeace, when it comes to energy consumption put out there because everybody's got an agenda. Greenpeace wants donations.

Elizabeth Warren wants to stir up the woke to get reelected. And, you know, the data is actually a lot more boring than you think. You know, green power powers Bitcoin. Like, that's the whole thing. What people are starting to realize now is that Bitcoin mining, in comparison to traditional data centers like Google, Microsoft, AWS, it's immaterial. People are like, oh, Google's building another five gigawatts of data center plants in the next two years. It's like, that's all of Bitcoin mining. That's just one company. Once you

actually start seeing the real data, you start understanding that a lot of the stuff of the fun about Bitcoin mining is very much that. It's about politics. Ripple has nothing but incentive to push show or try to prove that proof of work is bad because you know, they're pre-mint and completely centralized technology is good. It's like, come on, man, man brad just chill like you've made your

billions you've won it kind of won against the sec like leave bitcoin alone because if you don't it's going to blow up in your face which i still hopefully it does but we'll see you know they i think they did win again i don't care if the appeal is going on they won i don't i can't see sec coming out of this as a as a victor but that's a topic for another time that's a very different topic yes and i don't think i have enough information to truly talk about it with uh confidence but validus power i know this is something that is for some of our listeners is a very interesting topic and validus power they were or still are a power generating state or power generating company they generate energy they were or still are a power generating state or power generating company, they generate

energy, they were selling it, I believe, some of that energy to HUD eight, I think this was one of the stories out there and HUD eight took Validus to court with respect to not meeting their terms of the agreement. So there was a whole bunch of thing. And didn't Validus in the end, they declared bankruptcy or something along those lines? Am I correct with this? Technically insolvency, actually. Okay. Yeah. And actually, HUD-8 acquired the assets of Validus Power with the participation of Macquarie Global Markets or Capital Markets.

Essentially, Macquarie that backstopped the Validus asset purchase in the first place uh supported hud 8's acquisition of those assets so hud 8 actually owns the former assets of valis at this point um and yeah there was a it was a very messy and complicated situation um i was not aware of how messy it was before i joined the company but oh did i learn how messy it was when i started with the company um and i'll be honest i mean i think jamie leverton you know was given a tough uh tough hand i think she did the best she could at the time and i've got nothing for more respect for her um i know she's on her own at this point uh doing good things in the ecosystem still asher's doing uh what he can as a ceo of hot eight but i do think those assets are actually extremely valuable.

If you get those power generation plants pumping power back into Ontario's grid and putting behind-the-meter data centers on that land, I think those assets could be extremely valuable. Let's talk about Sunnyside now. It's 30 minutes in. We should have done this earlier, but you have a very interesting story and I wanted to talk about Sunnyside now. It's 30 minutes in. We should have done this earlier, but you have a very interesting story, and I wanted to talk about it.

But, okay, you guys provide hardware solutions for people out there. You're right now operating within Canada. Those are primarily your clients, and you're going to be stretching out to the U.S. Is that from what I understand, or is it even – I mean, I've watched another interview of you. You got your hands in seven different countries. Am I right with that, or am I wrong? what I understand or is it even from what I mean I've watched another interview of you you got your hands in seven different countries am I right with that or am I wrong uh well that was the uh data center company I was managing back when I lived in Antigua um yeah we were in seven countries with 330,000 servers now Sunnyside is a Canadian federal corporation, but we do business globally.

Last year, our revenue mix by geography was 80% U.S., 3% Canada, 17% rest of world. But one cool deal, for example, was I got pinged by a Swiss-based asset manager on behalf of a client, which is a Kuwaiti family office who owned hardware in Hong Kong, which I sold to a company, a public company with assets in Latin America. So we basically work like the UN. We've got folks all around the world, 40 different referral agents that bring us deals. Yeah, we work on ASIC hardware, so Bitmain, MicroBT, but mostly Bitmain. We did 95% of our hardware last year at Bitmain. Infrastructure, containers, transformers, switch

gear, parts. We do parts distribution, so fans, PSUs, cables, PDUs, chips even. I've sold bags of chips, literally, so that people can actually do soldering of their own hash boards and now we're doing site operations so folks need help racking hardware or de-racking hardware we've

got a team that we work with that will actually go to a site and be like you know a flash mob of folks to go in and DRACK or RACK ASIC hardware. We'll also do site optimization. So if there's issues with your site, we'll, again, send some of our engineers and techs to figure out, do some configuration on your network and optimize what you've been doing. And then we also partner with fantastic repair centers so that we can do what we offer as a fleet refresh program where if you've got older gen hardware will not only source you the new gen but will take down your older gen clean it diagnose it you know scrap the stuff

that doesn't work and then resell at the secondary market the older gen so you get working capital back to buy down your costs of newer generation of hardware. On the HPC side, primarily GPU sales, but we're actually helping folks with co-location capacity, so connecting folks that need Rackspace with Rackspace. We're also looking to start building up some of our own managed services data centers so that if you have GPUs and you want to park them with a reliable partner, we'll be able to actually be that partner for you for your gpu compute need so a little a little bit but pretty much focused on the data center ecosystem so the hs it's an hpc side of things because i am not familiar at all with this so i'm going to just ask you a very someone say

ignorant question because i just don't know so with respect to the hardware that is being used in that industry, is it primarily NVIDIA? Or is there any other competitors in there? Well, it's primarily NVIDIA, but AMD, Intel, you know, they all have their own hardware, but it's primarily NVIDIA. They're by far the leader, starting out with their video cards, 3090s, 3070s, 3060s, and now newest gen AI chips, sorry, GPUs, full systems now as well, H100s, H200s as well. So yeah, they're certainly the leader of the pack, but AMD has got some pretty interesting offerings.

The issue with the AMD technology is that it doesn't have that middleware, firmware, software connectivity that allows software engineers to do the processing they need in a seamless manner that Nvidia has spent a lot of money on. That being said, AMD is investing a lot of cash into making sure that its hardware, which is actually very competitive, has the middleware and software layer to allow the software engineers and AI engineers to actually use their hardware in a larger scale manner.

So they're still definitely a competitor to NVIDIA, but I mean, it's like Bitmain to MicroBT at this point. Yeah. To bring it to like the bit the bitcoin mining side so you were mentioning that latin america are some of the destinations for your services ronnie's asking when el salvador is is that something that you are already providing services to or is it on the radar for you uh we've worked with a bunch of folks that have operations in el salvador for sure i mean i think uh what bukele is doing down there is fantastic uh a bunch of my that have operations in El Salvador for sure. I mean, I think what Bukele is doing down there is fantastic. A bunch of my buddies have been down there quite often. You know, like Tobias Coindad, he's down there all the time. Gerald from HM Tech's down there

all the time. McCormick has been down, like Magdalena, she's been down a bunch. I mean, yeah, I think it's an interesting hub for sure. Have you been down? Pardon? Have you been down there? I have not been down El Salvador yet. That's probably going to change in the next year. But there's, yeah, I mean, I'm pretty sure I'll be shaking hands with those guys pretty soon down there as well.

It's a fantastic spot. Bitcoin City is great. I think what they've done with the Bitcoin bonds and the support of Bitcoin mining as well has been fantastic. I mean, this is exactly what we need. And it's the exact opposite of what's happened as a reality again to what like the IMF and the World Bank said it was going to happen. It's like, oh, you're going to Bitcoin. You're going to go to hell. You know, it's going to be terrible. And all of a sudden, Buke you know like it's gonna be terrible and all of a sudden bukele's like yeah no i'm we're gonna be just fine and sure

enough like they're laughing yeah it's incredible what he's been able to do in a very short period of time like to scare the central bankers globally yeah now he's thumbing his nose at the imf and indirectly to the united States as well. But I want to just ask you about the hardware, the ASICs hardware particularly, and the potential that there may be centralization in this respect. And the reason why I ask is because Bitmain seems to be the biggest player in this field, and they provide the most ASICs globally. There's MicroBT, there's Canon, there's a few

others out there, but really it's Bitmain. With that being said then, them being a Chinese company, them controlling most of the hardware out there, is that problematic? Is this something that is something that should be addressed moving forward or is this okay in your eyes? I mean, I think free market competition is the thing that Satoshi Nakamoto was all about. I think the market and the technology itself should speak for what should happen. I think Bitmain has been ahead of the market for a while because of the amount of investment they've put into Bitcoin mining. I think MicroBT has got a great product. I think they're definitely taking market share.

I think there's a ton of new entrants. I mean mean i could speak to probably five new entrants of the market uh bitdeer just announced that they acquired desiway which was uh an interesting uh manufacturer with some very strong hardware um so i think that right now bitmain is by far the number one i mean we've got nothing but respect and they're a huge part of our business and so i think competition's already here and i think it's going to increase over time as the institutional folks come in the fact that they're chinese i think mattered before but i think a lot of what they've been doing is moving a lot of their operations and manufacturing out of china their Their chips are based out of Taiwan.

They're manufacturing a ton of Malaysia, Indonesia, Thailand. I've heard rumors that they might even be looking at the US for some manufacturing assembly, just like my BT has. So I think the leadership there is very astute as to what the market needs or is looking for. So I wouldn't be surprised if they come out with some new innovation that people say, okay, they're not the dark Sith that everybody thought they were. But yeah, I mean, when you're the leader of the pack,

there's a lot of mud that gets thrown at you, so to speak. Ronnie's saying that CoinDad and Gerald were very cool guys. You need to come down there. So we'll leave it at that. Oil and gas companies. Oil and gas companies, it seems to me like they are the next

generation, if not they are the current generation of the people that, or companies that are going to be adopting data centers, Bitcoin mining, because they have a lot, quite a bit of stranded energy out there. Do you think that they are going to play a major role moving forward, given the fact that they have all this potentially stranded energy? I want to hear your thoughts on this. Yes, that is my answer. Yes, that is exactly what my thesis is as to what's going to be happening on a global basis with power generation as well as data centers.

If you look at Bitcoin 2024, 2023, some of the biggest sponsors were like Shell and Exxon. There's a reason. And it's not because of shit coins. It's really because they see the writing on the wall and they're looking for off takers of first resort for stranded power assets and so I think it's just a natural progression a natural evolution of what's gonna happen with Bitcoin mining as well as the traditional data center ecosystem I think Starlink once it gets to the point where it can handle you know higher throughput bandwidth closer to fiber, which it can happen.

I mean, we've seen massive leaps in Wi-Fi technology and satellite transmission technology occur. I think within the next five years, we could essentially have the ability to build a high throughput data center anywhere on the planet using satellite connectivity. So once that happens, then you're unlocking major areas of renewable power generation that can then be used for any type of compute load. I think that people differentiating compute load

and ascribing moral values to compute load is just absurd. If it's a data center on the outside, if it's generating compute on the inside, why is it any different if it's generating SHA-256 versus FOPs for a natural language processing model? Why? There is. the inside why is it any different if it's generating SHA-256 versus flops for for like a natural language processing model why there is and it's it's again it's political ideology people confusing themselves what they think is morally appropriate and morally reprehensible and again that turns into a political question that i think shouldn't be involved in the hardware and data

center ecosystem that we're building bitcoin is becoming more political in the united states it seems to be a topic of discussion with donald trump now talking about it and even biden to a degree it seems like he's going one direction he's kind of happy with another direction he's not but whatever that's a topic for another time i guess i mean we're kind of getting up to the end of this i just have one more question because i want to respect your time um hash rate the bitcoin hash rate overall it's's going up. It's always going up. Well, not always. There's a brief period of time right now, but it's for the most part, it's going up. It's a number go up type technology. Who's plugging in? In your particular point of view,

who do you think is plugging in equipment? Because I don't think it's all or the majority is coming from these publicly traded miners. It's somebody else, some country, something like I want to hear your thoughts, who you think is providing a lot of this new added hash rate. Well, I mean, major hash rate generation coming online is occurring out of Africa. Ethiopia is becoming a real player. Marathon just announced a major deal with the government of Kenya, utilizing a lot of their stranded hydropower. You look at areas in like Bhutan. A lot of these countries that have underutilized power generation are now

light bulbs turning on in their freaking head. And they're like, holy shit, we've got this resource that we've never been able to use because we don't have heavy manufacturing in the mountains of bhutan we don't have heavy manufacturing in like the area around the hydro dams in ethiopia but we can work with folks to bring in foreign direct investment to build these facilities to create local jobs and utilize this resource that we've never been able to utilize. So I think a lot of the hash regeneration is going to be coming outside of North America. And one thing that really bugs me the most, most topical with the CBP, the Canadian Bitcoin podcast,

is that Canada has so much underutilized renewable power that we literally sent to the states at a loss because of political bullshit that we need to change that because like Canada should be a leader in Bitcoin mining and we're not we're giving up a huge economic nut because of political ideology and candidly old-school thinking of what power should be used for what it shouldn't be used for so I think anybody listen this podcast should reach out to their MP, MPP and say, hey, why isn't Canada using their power locally versus sending it at a loss south of the border? We aren't, you know, northern Cuba, even though we act like it, we should be a free enterprise type country that

supports creating jobs, supports creating economic prosperity. You're right. I mean, the Ontario sells their energy, their excess energy, at a loss to the state of New York. It is what it is. But, you know, coming up against 45 minutes, I know you have something else to go to. I want to appreciate you coming on. Before we do sign off, I'm going to hand over the baton to you

where people can find you, what's going on next with you. Just, you know, the floor is yours, and then we'll just finalize it from there. I appreciate that, yeah yeah so you can find our team on sunny setting.ca or on linkedin i know it's a boomer social platform but it's a great place where you can actually see that we're a real team all of our profiles are there we're not like some shady folks that want to disappear if you send us cash to actually close a deal, we're on LinkedIn, Twitter,

uh, Telegram, or a lot of the Bitcoin mining hardware deals actually occur, but you can find us at, uh, most Bitcoin focused, uh, conferences,

uh, look out for the logo, sunny side digital, and, we'd love to get good deals done with good people. Awesome. Thank you for coming on. And with that, we'll be back on this again on Monday. So take care with good people. Awesome. Thank you for coming on. And with that,

we'll be back on this again on Monday. So take care until next time. Great chat. Thank you. That's. Are you a fan of the old school NHL 94 game on the Genesis or SNES? Why not check out my show, the NHL 94 podcast,

from tournaments and tactics to the people who make up this community. Check it out wherever you listen to podcasts or find it on YouTube.