UPDATE (12th June 18:45 BST): This article has been updated with comment from HashPlex investor and SecondMarket CEO Barry Silbert.
Bitcoin miner hosting company HashPlex has completed a $400,000 seed round led by Barry Silbert of SecondMarket and senior Facebook engineer Jason Prado.
Bernie Rihn, co-founder of HashPlex, said the funding would enable his company to complete its 1MW HashCenter in central Washington, east of Wenatchee, and continue developing custom hardware and software.
“HashPlex needs to move quickly while maintaining a level of great service, and this investment will help us continue to do so,” he said.
The investors
Silbert, who founded SecondMarket, a US-based online marketplace for buying and selling illiquid assets, is also behind the Bitcoin Opportunity Corp. This investment vehicle has previously funded a number of popular companies within the digital currency space, including BitPay, Circle, Coinbase and itBit.
Regarding his firm’s investment, Silbert told CoinDesk he sees the funding as helping to support smaller bitcoin miners, who he feels are being underserved by the investment community.
Silbert said:
“As digital currency mining has shifted to larger, well-funded ‘industrial’ mining companies, I was attracted to the idea of giving the little guy the opportunity to participate by hosting their mining equipment at professionally run, low energy cost facilities.”
Stanford University graduate Prado previously worked in software engineering roles at Microsoft and Google before joining Facebook in October 2012. He first met Rihn and HashPlex co-founder George Schnurle at university 10 years ago.
Rihn described having Silbert and Prado on board as investors as being like “having two seasoned guides”, adding:
“Both Barry and Jason know bitcoin well from a technical perspective and they know how to keep us well positioned as bitcoin continues to evolve.
Having them on board will be the difference between HashPlex as a flash in the pan and HashPlex as a lasting, trusted brand.”
Prado is also listed on the team section of HashPlex’s website as Advisor and Software Chief.
Hosted mining
Seattle-based HashPlex enables people to mine bitcoin without the disadvantages of keeping equipment at home. Customers send the company their digital currency miners and it does the rest, providing host computers, Internet, start/stop/control scripting and basic maintenance.
HashPlex currently offers three tiers of service, the first being ‘Alpha’, which costs $99/kw-month for a minimum of 1kw and a minimum service agreement of one year. It guarantees monthly up time of at least 95%, offering refunds for anything below this, but states its typical up time is 99.9%.
Armed with these capabilities, Silbert said that he believes the future is bright for HashPlex:
“By connecting its various facilities, the company has the opportunity to set up a vertically integrated mining pool that, as Mike Hearn recently recommended should be created, could set best practices for how a pool should be run, including such as things as documented block policies, audit-able inclusion and payouts, etc.”
The company currently employs eight people, although Rihn said the new funding will enable it to expand rapidly in order to meet customer demand.
Image via HashPlex