KnCMiner Raises $15M from Accel Partners to Complete a 16nm Chip

KnCMiner got $15 million from Accel Partners planning to build a 16-nanometer chip to improve its mining servers and boost efficiency.

Photo: KnCMiner

Photo: KnCMiner

KnCMiner, cloud bitcoin mining company, was launched in Stockholm in 2013. They started by building and selling bitcoin mining hardware to 3rd party miners. Since February 2014, the company has been mining bitcoins directly on an industrial scale.

The amount of more than $100M was generated by KnCMiner since their launch. Moreover, the company plans to invest millions in order to expand their services in the future. Sam Cole, co-founder and CEO of KnCMiner, says:

“We have invested more than $70M over the last 12 months into building a world-class bitcoin mining operation and plan to invest a further $150M over the next 18 months as we become one of the key transaction processors within Bitcoin. We are delighted to be partnering with Accel in this next chapter, as we continue building our brand and relationships within the Bitcoin and broader financial communities.”

In relation to that, a Series B fund raising round led by Accel Partners and other investors such as Creandum and GP Bullhound is announced by KnCMiner. The mining company is planning to use the invested money to increase its mining capacity and continue to build the bitcoin-processing infrastructure expanding its mining operation.

Taiwan Semiconductor Manufacturing Company collaborating with KnCMiner has already taped out the new 16-nanometer chip. For instance, Apple’s iPhone 6 and 6 Plus have only a 20-nanometer processor. KnCMiner believes to be the first firm to use the above-mentioned technology becoming a trusted, low-cost scale provider of bitcoin mining capacity.

Michiel Kotting, investor at Accel Partners, comments on KnCMiner’s willing to make profit on its functioning:

 “What we like about these guys is that they’re hyper-efficient and thus have a good cost base.”

In fact, today some miners are not able to profit off their businesses because of the excessive cost of energy associated with Bicoin mining and the price of Bicoin itself.  But adding the new 16nm cips, KnC will make the work of their Sweden-based efficient data center even more profitable.

Speaking about the costs of mining, Sam Cole says:  “We do not think the cost is prohibitively high, if we did we’d turn our farms off. We’re also developing our own hardware in-house, using several proprietary techniques to achieve higher efficiency.”

Cole said that  proprietary mining system would accelerate the hashing process and reduce power use. KNCMiner’s co-founder also noted that they managed to  succeed thanks to their focusing on the bitcoin algorithm:

“People tend to overestimate the impact of new technology in the short-term, but greatly underestimate the impact in the longer term. We’re in this for the long-term, believing that Bitcoin technology will make steady inroads and increase in usefulness as well as in value over many, many years to come.”

According to Cole,  bitcoin’s unstable character will not disappear “anytime soon” but the technology supporting it will surely become important.

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