1 00:00:04,559 --> 00:00:06,600 Speaker 1: Most people are down the road and there's sort of 2 00:00:06,800 --> 00:00:10,480 Speaker 1: maybe hundred houses, maybe a little bit less than that. 3 00:00:11,880 --> 00:00:13,880 Speaker 1: This summer, I spent some time in a remote town 4 00:00:13,920 --> 00:00:17,280 Speaker 1: along the coast of Canada, about three hundred miles northwest 5 00:00:17,320 --> 00:00:20,200 Speaker 1: of Vancouver. It's called Ocean Falls. He used to be 6 00:00:20,239 --> 00:00:23,560 Speaker 1: a paper mill town, and so these are this was 7 00:00:23,640 --> 00:00:25,840 Speaker 1: part of the paper facility. The blue building that you 8 00:00:25,840 --> 00:00:29,440 Speaker 1: guys are in that. Yeah, this was so this was 9 00:00:29,520 --> 00:00:32,160 Speaker 1: all buildings here and most of them were torn down 10 00:00:32,200 --> 00:00:34,720 Speaker 1: about ten years ago. The mills just downstream from a 11 00:00:34,800 --> 00:00:38,000 Speaker 1: dam that was built in the early nineteen hundreds. Ocean 12 00:00:38,000 --> 00:00:40,560 Speaker 1: Falls is surrounded by steep hills covered in thick forest, 13 00:00:40,760 --> 00:00:42,599 Speaker 1: and it sits on a deep bay that empties out 14 00:00:42,640 --> 00:00:45,440 Speaker 1: into the Pacific Ocean. Ocean Falls had been a town 15 00:00:45,479 --> 00:00:48,160 Speaker 1: of about five thousand people until the mill shut down. 16 00:00:48,840 --> 00:00:51,360 Speaker 1: Now it's less than a hundred. It's almost a ghost town. 17 00:00:51,479 --> 00:00:53,400 Speaker 1: That's where the wood would come down and then it 18 00:00:53,440 --> 00:00:55,440 Speaker 1: would be uh, they're the big grinders in there. They 19 00:00:55,480 --> 00:00:57,920 Speaker 1: would grind the wood up into With the mill gone, 20 00:00:58,360 --> 00:01:01,760 Speaker 1: Ocean Falls began looking for some new business, anything to 21 00:01:01,840 --> 00:01:05,679 Speaker 1: keep the community alive. It's latest hope comes from Kevin day. 22 00:01:06,600 --> 00:01:09,040 Speaker 1: Kevin's a tech guy from Vancouver, and he's the one 23 00:01:09,080 --> 00:01:14,920 Speaker 1: showing me around here, and do you need to use 24 00:01:14,920 --> 00:01:23,840 Speaker 1: you wear a hard hats. Borre Lex is the private 25 00:01:23,920 --> 00:01:27,480 Speaker 1: utility company that operates the damn in Ocean Falls, but 26 00:01:27,600 --> 00:01:30,759 Speaker 1: Kevin doesn't work there. He's actually bora Lex's new customer. 27 00:01:32,240 --> 00:01:42,120 Speaker 1: Is that sound you guys, Yes, that huney you here. 28 00:01:42,640 --> 00:01:45,520 Speaker 1: It's the sound of hundreds of fans blowing past hundreds 29 00:01:45,560 --> 00:01:48,120 Speaker 1: of little computers. They're on twenty four hours a day 30 00:01:48,560 --> 00:02:03,400 Speaker 1: cranking through complicated math problems making bitcoins. Hi, I'm Pegatari 31 00:02:03,920 --> 00:02:07,400 Speaker 1: and I'm Joshua Bursting. And this week on Decrypted, we're 32 00:02:07,440 --> 00:02:10,320 Speaker 1: bringing you the story of Ocean Falls, a town on 33 00:02:10,360 --> 00:02:13,400 Speaker 1: a multi decade search for a savior that thought it 34 00:02:13,520 --> 00:02:16,160 Speaker 1: might have found one when a bitcoin mine came to town. 35 00:02:16,960 --> 00:02:19,480 Speaker 1: This is the first episode of our new season, where 36 00:02:19,480 --> 00:02:22,639 Speaker 1: for the next four months will be exploring the unintended 37 00:02:22,680 --> 00:02:26,760 Speaker 1: consequences of technology. The biggest problem for Ocean Falls was 38 00:02:26,760 --> 00:02:29,639 Speaker 1: its isolation. It was just too much trouble to bring 39 00:02:29,680 --> 00:02:33,440 Speaker 1: workers there and too expensive to ship goods out. But 40 00:02:33,480 --> 00:02:36,519 Speaker 1: those things don't matter much for bitcoin miners. All they're 41 00:02:36,560 --> 00:02:38,880 Speaker 1: looking for is cold weather to keep their computers cool 42 00:02:39,480 --> 00:02:42,840 Speaker 1: and enough electricity to keep them running. Ocean Falls has both. 43 00:02:43,520 --> 00:02:45,840 Speaker 1: But if a town is good for bitcoin mining, does 44 00:02:45,880 --> 00:02:49,240 Speaker 1: that mean bitcoin mining is good for the town. And 45 00:02:49,320 --> 00:02:52,040 Speaker 1: while it may have seemed promising when prices were soaring, 46 00:02:52,440 --> 00:03:03,640 Speaker 1: what happens now that they've crashed? Stay with us. I 47 00:03:03,720 --> 00:03:06,480 Speaker 1: first heard about Ocean Falls in January. I was talking 48 00:03:06,520 --> 00:03:09,960 Speaker 1: to a businessman in Toronto who invested in cryptocurrency businesses, 49 00:03:10,760 --> 00:03:12,880 Speaker 1: and he mentioned that bitcoin miners have been taken an 50 00:03:12,880 --> 00:03:15,880 Speaker 1: interest in old mill sites in British Columbia. That immediately 51 00:03:15,919 --> 00:03:19,399 Speaker 1: caught my attention. The bitcoin gold rush was all over 52 00:03:19,440 --> 00:03:23,359 Speaker 1: the news. Bitcoin stores past thou dollars for the first time. 53 00:03:23,560 --> 00:03:27,240 Speaker 1: It's up, and it's up big for this about since 54 00:03:27,320 --> 00:03:29,799 Speaker 1: nine thirty this morning, New York Times, six thirty R time. 55 00:03:30,000 --> 00:03:32,240 Speaker 1: I think that we're going to see fifty by the 56 00:03:32,400 --> 00:03:36,520 Speaker 1: end of two thousand eighteen for bitcoin. It's easy to 57 00:03:36,520 --> 00:03:40,680 Speaker 1: think of bitcoin is something that's happening just online. In fact, 58 00:03:40,760 --> 00:03:42,920 Speaker 1: the price runup had set off a global race to 59 00:03:42,960 --> 00:03:46,120 Speaker 1: find actual physical places that are well suited for the 60 00:03:46,200 --> 00:03:49,200 Speaker 1: data centers and needed to create new bitcoins through a 61 00:03:49,240 --> 00:03:52,520 Speaker 1: process known as mining. And here was a place where 62 00:03:52,520 --> 00:03:57,840 Speaker 1: the crypto rush felt like an actual gold rush, so 63 00:03:57,880 --> 00:04:00,560 Speaker 1: I asked for an introduction to Kevin. He agreed to 64 00:04:00,600 --> 00:04:02,840 Speaker 1: talk to me, and I began checking in with him 65 00:04:02,880 --> 00:04:05,640 Speaker 1: every once in a while as he traveled between Vancouver 66 00:04:05,760 --> 00:04:08,960 Speaker 1: and Ocean Falls over the course of this year. Finally, 67 00:04:09,040 --> 00:04:12,400 Speaker 1: in July, I headed up there myself with Jackie Dives, 68 00:04:12,400 --> 00:04:15,720 Speaker 1: a photographer based in Vancouver. And it's a trek because 69 00:04:15,880 --> 00:04:19,120 Speaker 1: there's no road to get there. Yeah. From Vancouver, I 70 00:04:19,160 --> 00:04:21,440 Speaker 1: took two little hops and a twenty person playing to 71 00:04:21,520 --> 00:04:24,200 Speaker 1: Bella Bella, which is the closest town with an airport. 72 00:04:24,920 --> 00:04:27,799 Speaker 1: Then I hitched a ride from people boating into work 73 00:04:27,880 --> 00:04:30,800 Speaker 1: at a local salmon hatchery that's the only other real 74 00:04:30,839 --> 00:04:36,919 Speaker 1: business in town. The boat moves through narrow channels between 75 00:04:36,920 --> 00:04:39,440 Speaker 1: the mountains and then opens up into this big bay 76 00:04:39,680 --> 00:04:44,640 Speaker 1: and there you are. It's unbelievably beautiful. When we got 77 00:04:44,680 --> 00:04:46,760 Speaker 1: to town, Kevin was walking up to pick us up 78 00:04:46,760 --> 00:04:49,800 Speaker 1: at the dock. I wonder if this is Kevin here. 79 00:04:51,120 --> 00:04:56,000 Speaker 1: Kevin is an athletic guys in his mid forties. Hey Kevin, good, 80 00:04:56,040 --> 00:04:58,760 Speaker 1: how are you? Kevin says he's most comfortable when sitting 81 00:04:58,760 --> 00:05:01,240 Speaker 1: in front of a computer, and he's run a handful 82 00:05:01,240 --> 00:05:04,080 Speaker 1: of start ups in and around Vancouver. He used to 83 00:05:04,160 --> 00:05:06,760 Speaker 1: run a business selling ringtones back when that was a thing, 84 00:05:07,200 --> 00:05:08,600 Speaker 1: and then he had a business that had to do 85 00:05:08,680 --> 00:05:12,039 Speaker 1: with insurance. Kevin had first heard about Ocean Falls in 86 00:05:12,040 --> 00:05:14,480 Speaker 1: twenty ten when he saw a TV documentary about it. 87 00:05:15,080 --> 00:05:17,080 Speaker 1: He actually suggested to a friend of his and the 88 00:05:17,120 --> 00:05:19,080 Speaker 1: hotel business that it might be a cool place to 89 00:05:19,120 --> 00:05:21,359 Speaker 1: set up a resort, but nothing ever came of that. 90 00:05:22,279 --> 00:05:24,839 Speaker 1: Then Kevin started getting interested in bitcoin in about twenty 91 00:05:24,839 --> 00:05:28,800 Speaker 1: twelve and twenty thirteen. Over time, Kevin became fixated on 92 00:05:28,839 --> 00:05:32,360 Speaker 1: building his own bitcoin mine. That's when he remembered Ocean Falls. 93 00:05:33,000 --> 00:05:36,240 Speaker 1: Ocean Falls has this nostalgic vibe of a pioneer town 94 00:05:36,320 --> 00:05:38,960 Speaker 1: in decline. At least that's how it came off in 95 00:05:38,960 --> 00:05:41,200 Speaker 1: a news cost you showed me from nineteen eighty one. 96 00:05:45,680 --> 00:05:49,280 Speaker 1: The good old battle days in Ocean Falls. Today, they 97 00:05:49,360 --> 00:05:52,960 Speaker 1: were remembered with fond regret by the last survivors of 98 00:05:53,000 --> 00:06:02,640 Speaker 1: a very special kind of town. Today most of the 99 00:06:02,640 --> 00:06:06,080 Speaker 1: residents are older. They have a really romantic view of 100 00:06:06,120 --> 00:06:09,440 Speaker 1: the place. Like here's Tony Zignash, who runs the small 101 00:06:09,480 --> 00:06:11,840 Speaker 1: boarding house where I stayed when I was there. Every 102 00:06:11,839 --> 00:06:14,320 Speaker 1: time we come around the corner into some Falls, I 103 00:06:14,360 --> 00:06:18,600 Speaker 1: always think this is as close to paradise as as 104 00:06:18,640 --> 00:06:21,799 Speaker 1: it gets. Still, it takes a certain type of person 105 00:06:21,880 --> 00:06:25,120 Speaker 1: to live there. It may be beautiful, but it's so remote. 106 00:06:25,520 --> 00:06:28,320 Speaker 1: People in Ocean Falls put up with his challenges because 107 00:06:28,360 --> 00:06:30,320 Speaker 1: they seem to relish the sense of removal from the 108 00:06:30,320 --> 00:06:33,839 Speaker 1: outside world. But not Kevin. No, he immediately saw the 109 00:06:33,839 --> 00:06:37,279 Speaker 1: town's the setting for his own kind of secret, technological retreat, 110 00:06:37,600 --> 00:06:39,880 Speaker 1: like the ones he daydreamed about when watching television as 111 00:06:39,920 --> 00:06:43,360 Speaker 1: a kid. I always love this idea of like sort 112 00:06:43,360 --> 00:06:45,599 Speaker 1: of this high tech sort of layer, kind of in 113 00:06:45,600 --> 00:06:47,080 Speaker 1: the middle of sort of nowhere. Maybe it's sot of 114 00:06:47,120 --> 00:06:48,720 Speaker 1: because I was a big fan of like James Bond 115 00:06:48,760 --> 00:06:50,640 Speaker 1: movies or something like that, where they had sort of 116 00:06:50,640 --> 00:06:54,360 Speaker 1: these guys they were had these Kevin's not the first 117 00:06:54,400 --> 00:06:57,400 Speaker 1: businessman to fall in love with Ocean Falls. There's been 118 00:06:57,440 --> 00:07:00,640 Speaker 1: a steady stream of proposals. The first one happened soon 119 00:07:00,680 --> 00:07:03,560 Speaker 1: after the mill closed, when a businessman bought many of 120 00:07:03,600 --> 00:07:06,320 Speaker 1: the biggest buildings in town, hoping to convert them into 121 00:07:06,400 --> 00:07:09,400 Speaker 1: a resort and casino for people traveling up the coast 122 00:07:09,440 --> 00:07:12,440 Speaker 1: on cruise ships. There have also been plans to brew beer, 123 00:07:12,880 --> 00:07:16,600 Speaker 1: grow marijuana, and bottle water. At one point, it looked 124 00:07:16,600 --> 00:07:18,600 Speaker 1: like Ocean Falls would be the setting for an action 125 00:07:18,640 --> 00:07:22,720 Speaker 1: movie starting Al Pacino and Hillary Swank. My personal favorite 126 00:07:22,760 --> 00:07:24,920 Speaker 1: was a plan in the nineteen eighties to fill tankers 127 00:07:24,960 --> 00:07:27,920 Speaker 1: up with water and ship at wholesale to California or 128 00:07:27,960 --> 00:07:31,000 Speaker 1: even Saudi Arabia. Needless to say, all of those plans 129 00:07:31,000 --> 00:07:33,640 Speaker 1: have fallen flat, with the one exception of the fish 130 00:07:33,640 --> 00:07:39,560 Speaker 1: farming company whose employees gave you a ride. Any business 131 00:07:39,560 --> 00:07:42,080 Speaker 1: plan for Ocean Falls eventually ends up in front of 132 00:07:42,120 --> 00:07:45,520 Speaker 1: Brent Case. He's the operation manager for bor Alex in 133 00:07:45,520 --> 00:07:48,880 Speaker 1: British Columbia. I had talked to Brent before flying up 134 00:07:48,920 --> 00:07:51,840 Speaker 1: to Ocean Falls and he spotted me and Jackie when 135 00:07:51,840 --> 00:07:54,240 Speaker 1: we got off the plane. He walked over to introduce 136 00:07:54,320 --> 00:08:02,680 Speaker 1: himself once we landed in Bellabella Galls. Yeah, Brent's basically 137 00:08:02,760 --> 00:08:05,880 Speaker 1: Kevin's opposite. Can be hard sometimes to get Kevin to 138 00:08:05,960 --> 00:08:08,200 Speaker 1: talk much, but Brent would talk all day if you 139 00:08:08,240 --> 00:08:12,080 Speaker 1: didn't interrupt him. Kevin likes the city. Brent describes himself 140 00:08:12,080 --> 00:08:15,119 Speaker 1: as a bush person and he loves to regale people 141 00:08:15,120 --> 00:08:18,280 Speaker 1: with stories about ravens or mountain lions or bears that 142 00:08:18,320 --> 00:08:22,160 Speaker 1: he's interacted with over the years. Brent has spent decades 143 00:08:22,360 --> 00:08:24,600 Speaker 1: up and down this coast, in the small towns and 144 00:08:24,640 --> 00:08:27,240 Speaker 1: the woods in between them. He first came to Ocean 145 00:08:27,240 --> 00:08:30,040 Speaker 1: Falls in the mid eighties when he was helping string 146 00:08:30,040 --> 00:08:32,680 Speaker 1: a transmission line from the power plant at the dam 147 00:08:32,880 --> 00:08:36,040 Speaker 1: to a few of the neighboring towns. He's now something 148 00:08:36,080 --> 00:08:39,280 Speaker 1: of a local celebrity. He bought the biggest house Notion 149 00:08:39,320 --> 00:08:42,040 Speaker 1: Falls and has poured a lot of time and money 150 00:08:42,080 --> 00:08:45,520 Speaker 1: into fixing it up. His star rose even more after 151 00:08:45,559 --> 00:08:48,520 Speaker 1: he survived a grizzly bear attack. I was just finishing 152 00:08:48,600 --> 00:08:50,200 Speaker 1: up my engineering and I was heading back to the 153 00:08:50,200 --> 00:08:54,080 Speaker 1: truck and he uh jumped me on my arm and 154 00:08:55,920 --> 00:08:59,440 Speaker 1: ripped the elbow. He bitten the humbol's arms and then 155 00:08:59,559 --> 00:09:02,840 Speaker 1: ripped this out from here right over the head. If 156 00:09:02,840 --> 00:09:06,560 Speaker 1: it did you google? Did you google? And google? Yeah? Yeah, 157 00:09:06,600 --> 00:09:10,240 Speaker 1: so I did a show with the Animal Planet. That 158 00:09:10,320 --> 00:09:12,840 Speaker 1: incident with the bear inspired a wave of local and 159 00:09:12,880 --> 00:09:20,240 Speaker 1: even international media coverage. Then around, Brent's phone suddenly started 160 00:09:20,320 --> 00:09:23,000 Speaker 1: ringing off the hook in a way it never had before. 161 00:09:24,120 --> 00:09:26,280 Speaker 1: The people were calling in search of places to set 162 00:09:26,320 --> 00:09:31,199 Speaker 1: up bitcoin mines. Bitcoin mining was becoming increasingly lucrative as 163 00:09:31,240 --> 00:09:34,120 Speaker 1: the price sword, especially if you can find a place 164 00:09:34,160 --> 00:09:37,560 Speaker 1: like Ocean Falls where the cost of power is extremely cheap. 165 00:09:38,440 --> 00:09:41,480 Speaker 1: A large proportion of bitcoin mining was happening in China, 166 00:09:42,080 --> 00:09:45,200 Speaker 1: but for many prospective miners, the idea of doing business 167 00:09:45,240 --> 00:09:48,680 Speaker 1: in Canada was much more attractive. You know, I'm getting 168 00:09:49,000 --> 00:09:53,640 Speaker 1: companies from Texas, New Jersey, California, Washington, Steed. Of course, 169 00:09:53,760 --> 00:09:57,320 Speaker 1: Brenton no the first thing about bitcoin. One one company 170 00:09:57,320 --> 00:10:00,560 Speaker 1: from Australia, I mean, one from Argentina, I mean. And 171 00:10:00,600 --> 00:10:02,400 Speaker 1: it didn't take him long to realize that most of 172 00:10:02,400 --> 00:10:04,679 Speaker 1: the people calling him had no clue how to pull 173 00:10:04,720 --> 00:10:07,400 Speaker 1: off what they were proposing. A lot of the blotching 174 00:10:07,720 --> 00:10:11,160 Speaker 1: people and bitcoin people and you name it. They think 175 00:10:11,200 --> 00:10:14,319 Speaker 1: they can come in and do a project without you know, 176 00:10:14,440 --> 00:10:17,880 Speaker 1: doing their homework. A lot of speculation, but brent also 177 00:10:17,920 --> 00:10:21,400 Speaker 1: saw himself as Ocean Fall's main booster. He knew that 178 00:10:21,440 --> 00:10:24,040 Speaker 1: the longer the town went on in its semi dormant state, 179 00:10:24,640 --> 00:10:27,000 Speaker 1: the bigger the chance was that it would never recover. 180 00:10:28,280 --> 00:10:31,480 Speaker 1: And after seeing so many other business ideas full flat. 181 00:10:31,880 --> 00:10:34,760 Speaker 1: Brent thought these clueless people blowing up his phone to 182 00:10:34,840 --> 00:10:38,640 Speaker 1: talk about some esoteric technology trend might be worth taking 183 00:10:38,640 --> 00:10:45,560 Speaker 1: a flyer. On the first night we were in Ocean Falls, 184 00:10:45,720 --> 00:10:48,040 Speaker 1: Jack and I walked up to Kevin's home to meet 185 00:10:48,040 --> 00:10:50,959 Speaker 1: with Kevin, Brent, and one of Brent's colleagues, a guy 186 00:10:51,000 --> 00:10:55,840 Speaker 1: named Alistair Howard. This is the house you mentioned earlier, 187 00:10:56,000 --> 00:10:59,040 Speaker 1: the one that Brent had fixed up. Kevin recently bought 188 00:10:59,080 --> 00:11:01,760 Speaker 1: it from him. Yeah, it's a really odd place. Once 189 00:11:01,800 --> 00:11:04,160 Speaker 1: you get inside the house, it feels like a suburban home. 190 00:11:04,240 --> 00:11:07,520 Speaker 1: There's new floors, a nice kitchen, even a huge flat 191 00:11:07,559 --> 00:11:11,199 Speaker 1: screen TV. But to get there, Jack and I walked 192 00:11:11,200 --> 00:11:13,439 Speaker 1: down a street where most of the other buildings were 193 00:11:13,480 --> 00:11:16,200 Speaker 1: basically just rubble, and then we bush whacked our way 194 00:11:16,280 --> 00:11:18,480 Speaker 1: up a steep trail through some brush to get to 195 00:11:18,480 --> 00:11:23,760 Speaker 1: the door. Is that like little deer path? Really? The 196 00:11:23,760 --> 00:11:26,000 Speaker 1: way we're supposed to get here? Could be? I've never 197 00:11:26,040 --> 00:11:31,000 Speaker 1: had anyone actually comes through the front door before, even 198 00:11:31,040 --> 00:11:34,080 Speaker 1: with Kevin sitting there. Brennan Alistair were pretty open about 199 00:11:34,080 --> 00:11:36,040 Speaker 1: how skeptical they were of him at first. Here again, 200 00:11:36,080 --> 00:11:39,280 Speaker 1: he's one another one of these I thought, hair brained ideas. 201 00:11:42,000 --> 00:11:46,960 Speaker 1: So when we did we need in Vancouver first, Kevin 202 00:11:46,960 --> 00:11:49,560 Speaker 1: definitely didn't change Brent's mind by coming off like someone 203 00:11:49,679 --> 00:11:51,640 Speaker 1: who knew what he was talking about. When he first 204 00:11:51,640 --> 00:11:55,800 Speaker 1: called in late Kevin didn't know much about electricity, he 205 00:11:55,880 --> 00:11:59,000 Speaker 1: knew nothing about dams, and he had no experience navigating 206 00:11:59,000 --> 00:12:01,200 Speaker 1: the shipping channels that on up and down the sparsely 207 00:12:01,200 --> 00:12:05,280 Speaker 1: populated parts of Canada's West coast. But Kevin was asking 208 00:12:05,320 --> 00:12:09,080 Speaker 1: the right questions and Brent was looking for someone anyone 209 00:12:09,160 --> 00:12:20,719 Speaker 1: really to get excited about Kevin would do with this 210 00:12:20,800 --> 00:12:24,120 Speaker 1: foot Finally in the door, Kevin developed a pretty simple strategy. 211 00:12:24,559 --> 00:12:26,760 Speaker 1: Who just asked Brent for help with everything. A lot 212 00:12:26,760 --> 00:12:28,880 Speaker 1: of the challenges that you you face here or not 213 00:12:29,480 --> 00:12:31,880 Speaker 1: things that you can just sort of solve look on 214 00:12:31,920 --> 00:12:34,040 Speaker 1: your own by you know, just doing a Google search 215 00:12:34,080 --> 00:12:35,680 Speaker 1: and like, well how do I get this in here 216 00:12:35,760 --> 00:12:38,360 Speaker 1: or do that? It's all sort of like, oh, you know, 217 00:12:38,520 --> 00:12:41,319 Speaker 1: like Brent knows a guy for everything, right, so if 218 00:12:41,320 --> 00:12:42,839 Speaker 1: there's a problem, it's like I know a guy who 219 00:12:42,840 --> 00:12:44,400 Speaker 1: could do that. I know someone who could get this 220 00:12:44,440 --> 00:12:45,920 Speaker 1: in here. I know who you could do this. So 221 00:12:46,559 --> 00:12:48,640 Speaker 1: this was really clever on Kevin's part. I think he 222 00:12:48,720 --> 00:12:51,520 Speaker 1: took Brent's enthusiasm about the town and used it to 223 00:12:51,559 --> 00:12:54,080 Speaker 1: turn him into a kind of spokesperson within Bora Lax 224 00:12:54,160 --> 00:12:58,520 Speaker 1: for Kevin's company, which he named Ocean Falls Blockchain. It 225 00:12:58,520 --> 00:13:01,880 Speaker 1: didn't hurt that Bitcoin just kept getting more and more exciting. 226 00:13:02,160 --> 00:13:04,960 Speaker 1: The price rose from about four hundred dollars in late 227 00:13:05,720 --> 00:13:08,840 Speaker 1: when Kevin started making his first inquiries with Ocean Falls. 228 00:13:09,480 --> 00:13:11,920 Speaker 1: A year later, the price would be closing in on 229 00:13:12,000 --> 00:13:16,160 Speaker 1: a thousand dollars. Kevin wasn't the only person calling Brent, 230 00:13:16,400 --> 00:13:19,200 Speaker 1: but most people would call him once realize how hard 231 00:13:19,240 --> 00:13:22,320 Speaker 1: this would be and disappear. Some I call a few 232 00:13:22,320 --> 00:13:25,960 Speaker 1: times before fading away, But Alistair remembers how Kevin just 233 00:13:26,080 --> 00:13:29,520 Speaker 1: never stopped dialing the phone. I just remember so many 234 00:13:29,520 --> 00:13:33,160 Speaker 1: times you would tell me Kevin's calling again. I'm like again. 235 00:13:34,520 --> 00:13:37,679 Speaker 1: In fact, Kevin became so persistent that he turned into 236 00:13:37,800 --> 00:13:41,160 Speaker 1: something of a myth inside the company. At a certain point, 237 00:13:41,200 --> 00:13:44,480 Speaker 1: Kevin went to Toronto and cold called Patrick Lamaire, the 238 00:13:44,520 --> 00:13:47,720 Speaker 1: president of Bolax, to ask for a meeting. And Patrick 239 00:13:47,760 --> 00:13:50,680 Speaker 1: already knew who he was when I sat down with them, 240 00:13:50,720 --> 00:13:52,640 Speaker 1: and he said, like I said, well, I think we're 241 00:13:52,640 --> 00:13:54,880 Speaker 1: really gonna move ahead on this project, and he said, okay, 242 00:13:54,880 --> 00:13:56,360 Speaker 1: well that's why I want to meet with you, because 243 00:13:56,360 --> 00:13:57,560 Speaker 1: I want to see if you were like a real 244 00:13:57,600 --> 00:14:01,480 Speaker 1: person being here hearing about your name while this time. 245 00:14:01,520 --> 00:14:03,560 Speaker 1: But that's nothing's ever happened. It's been two years, so 246 00:14:03,640 --> 00:14:05,920 Speaker 1: are are you real? Is it's really going to happen. 247 00:14:08,440 --> 00:14:11,199 Speaker 1: Patrick had a decision to make. Should he agree to 248 00:14:11,240 --> 00:14:15,120 Speaker 1: sell cheap electricity to Kevin? The bitcoin mine might work 249 00:14:15,160 --> 00:14:17,520 Speaker 1: out well as a business, but it was unlikely to 250 00:14:17,559 --> 00:14:20,400 Speaker 1: make much of a difference to Bora ax Kevin's plans 251 00:14:20,400 --> 00:14:23,520 Speaker 1: were to make just under six million dollars in revenue. 252 00:14:24,400 --> 00:14:28,200 Speaker 1: Bora axes annual revenue is about three fifty million, but 253 00:14:28,240 --> 00:14:30,600 Speaker 1: the utility didn't have a lot of other options for 254 00:14:30,640 --> 00:14:33,400 Speaker 1: ocean falls. Bora lex Is only using two of the 255 00:14:33,480 --> 00:14:36,640 Speaker 1: dam's four turbines because there would be nowhere else to 256 00:14:36,720 --> 00:14:40,440 Speaker 1: send the electricity they'd produce. So Kevin secured his deal 257 00:14:40,560 --> 00:14:43,120 Speaker 1: to buy hydro electric power from Bora Lax at a 258 00:14:43,160 --> 00:14:47,240 Speaker 1: heavily discounted rate. This was basically an incentive to get 259 00:14:47,320 --> 00:14:49,160 Speaker 1: him to set up his business in a place that 260 00:14:49,200 --> 00:14:53,080 Speaker 1: would otherwise not make much sense. Neither Kevin nor Brent 261 00:14:53,160 --> 00:14:56,920 Speaker 1: wanted to discuss the specific price. That's probably because it's 262 00:14:57,000 --> 00:15:01,479 Speaker 1: so low. According to a presentation and showed investors in February, 263 00:15:02,000 --> 00:15:04,200 Speaker 1: it was less than four cents per kill a lot hour. 264 00:15:05,080 --> 00:15:07,160 Speaker 1: That's less than half the rate boro Lex charged to 265 00:15:07,200 --> 00:15:11,480 Speaker 1: ship power to Bella Bella even back in the rates 266 00:15:11,560 --> 00:15:14,400 Speaker 1: solo that the head of another bitcoin mining operation in 267 00:15:14,440 --> 00:15:18,680 Speaker 1: the area described it as almost free. The power from 268 00:15:18,680 --> 00:15:22,680 Speaker 1: the Ocean Falls Damn had another advantage. Bitcoin miners are 269 00:15:22,680 --> 00:15:26,320 Speaker 1: coming up for increasing criticism for burning through massive amounts 270 00:15:26,320 --> 00:15:28,560 Speaker 1: of energy just as the world is trying to fight 271 00:15:28,600 --> 00:15:33,720 Speaker 1: climate change. But hydro electricity doesn't create carbon emissions, and 272 00:15:33,800 --> 00:15:38,760 Speaker 1: this power literally had no other use. Now, all Kevin 273 00:15:38,760 --> 00:15:41,000 Speaker 1: had to do was figure out how to get hundreds 274 00:15:41,040 --> 00:15:44,880 Speaker 1: and eventually thousands of computers from China, along with heavy 275 00:15:44,880 --> 00:15:47,720 Speaker 1: equipment to power them all the way to Ocean Falls. 276 00:15:48,840 --> 00:15:50,600 Speaker 1: We brought them in Vancouver and then we trucked them 277 00:15:50,640 --> 00:15:53,040 Speaker 1: up from there. There's a truck road somewhere if you 278 00:15:53,080 --> 00:15:56,280 Speaker 1: need it. No, there's no road into Ocean Falls. Uh um, 279 00:15:56,560 --> 00:15:58,840 Speaker 1: you can come in on the on the ferry, which 280 00:15:58,880 --> 00:16:01,680 Speaker 1: is what we did. It's kind of a full day things. 281 00:16:01,800 --> 00:16:04,080 Speaker 1: As I mentioned, before you know. We loaded them on 282 00:16:04,400 --> 00:16:07,280 Speaker 1: the truck at the airport and then set the operation 283 00:16:07,400 --> 00:16:09,600 Speaker 1: up in an old paper mill that had been falling 284 00:16:09,640 --> 00:16:14,360 Speaker 1: apart for decades. But he did it. Finally, this July, 285 00:16:14,960 --> 00:16:20,720 Speaker 1: Kevin flipped on the first few servers. Kevin's bitcoin mine 286 00:16:20,720 --> 00:16:23,960 Speaker 1: has been reverberating through Ocean Falls ever since Kevin first 287 00:16:24,000 --> 00:16:26,200 Speaker 1: came to town, and not just because you can hear 288 00:16:26,240 --> 00:16:28,520 Speaker 1: the humming of the fans far away from the building. 289 00:16:29,000 --> 00:16:31,640 Speaker 1: I kind of assumed the cryptocurrency boom would have passed 290 00:16:31,640 --> 00:16:36,120 Speaker 1: Ocean Falls by completely, but that wasn't really true. One day, 291 00:16:36,200 --> 00:16:38,760 Speaker 1: Kevin and I visited one of the only public businesses 292 00:16:38,880 --> 00:16:42,880 Speaker 1: in town. It's a local bar. It's open every Monday, Wednesday, 293 00:16:42,920 --> 00:16:46,480 Speaker 1: and Friday from four pm. The seven pm gets packed, 294 00:16:46,960 --> 00:16:48,400 Speaker 1: and the guy sitting next to me said he had 295 00:16:48,440 --> 00:16:51,760 Speaker 1: a friend who was mining cryptocurrencies in Asia. Still, a 296 00:16:51,800 --> 00:16:55,520 Speaker 1: lot of people didn't really seem to know what it was. Yeah, 297 00:16:56,160 --> 00:17:00,120 Speaker 1: even like my granddaughters understand it. Yeah, not me. Know. 298 00:17:00,360 --> 00:17:04,520 Speaker 1: It's a new technology. Yeah, and as you get older, 299 00:17:04,560 --> 00:17:06,879 Speaker 1: you don't at least I don't pick up on it 300 00:17:06,960 --> 00:17:09,000 Speaker 1: very fast. Well, I mean you gotta, it's gonna be 301 00:17:09,040 --> 00:17:11,560 Speaker 1: something you're interested into yeah, like right now, especially now, 302 00:17:11,560 --> 00:17:13,199 Speaker 1: because it's very techy right now. It's just like the 303 00:17:13,240 --> 00:17:15,679 Speaker 1: Internet was in the early nineties. It was there, but 304 00:17:15,720 --> 00:17:19,000 Speaker 1: it was really techy, you know it six I took 305 00:17:19,080 --> 00:17:21,879 Speaker 1: computer programming, yeah, all right on, so I was like, 306 00:17:22,240 --> 00:17:26,359 Speaker 1: uh like fortran kind of stuff for right for now, 307 00:17:26,520 --> 00:17:29,320 Speaker 1: many residents are hopeful that the bitcoin mine will help 308 00:17:29,400 --> 00:17:33,240 Speaker 1: turn things around. Kevin's construction work did provide a handful 309 00:17:33,280 --> 00:17:35,639 Speaker 1: of jobs, but those went to crews that came in 310 00:17:35,680 --> 00:17:38,600 Speaker 1: on boats from the Vancouver area. That's been good for Tony, 311 00:17:38,760 --> 00:17:41,399 Speaker 1: the woman who runs the boarding house, but she framed 312 00:17:41,480 --> 00:17:45,639 Speaker 1: the main impact as more psychological than economic. It always 313 00:17:45,680 --> 00:17:50,280 Speaker 1: puts that air of positivity in in into the mix, 314 00:17:50,760 --> 00:17:53,200 Speaker 1: and that makes a big difference. We have a very 315 00:17:53,240 --> 00:17:57,600 Speaker 1: aging population here, and when I say aging, I mean 316 00:17:57,760 --> 00:18:01,639 Speaker 1: seventy and and up. So there's not a lot of energy, 317 00:18:02,280 --> 00:18:07,000 Speaker 1: not a lot of enthusiasm for anything new, to tell 318 00:18:07,000 --> 00:18:10,720 Speaker 1: you the truth, So I just would like to attract 319 00:18:10,720 --> 00:18:13,879 Speaker 1: some younger people to come in. There is a post 320 00:18:13,880 --> 00:18:16,960 Speaker 1: office and a government run ferry stop in town, but 321 00:18:17,080 --> 00:18:20,040 Speaker 1: Ocean Falls doesn't have enough people to support any private 322 00:18:20,040 --> 00:18:23,360 Speaker 1: businesses except for the bar. Really if you can believe it. 323 00:18:23,480 --> 00:18:26,760 Speaker 1: There isn't even a grocery store in Ocean Falls right now. 324 00:18:26,760 --> 00:18:30,680 Speaker 1: We're barging in all of our groceries from Port Hardy. 325 00:18:30,800 --> 00:18:35,000 Speaker 1: It's a two week process to get from time you 326 00:18:35,080 --> 00:18:37,040 Speaker 1: order your groceries to the time you get them here. 327 00:18:37,880 --> 00:18:41,440 Speaker 1: Kevin's business isn't changing that for now. It's too small. 328 00:18:42,080 --> 00:18:44,320 Speaker 1: He's currently using under a mega watt of power at 329 00:18:44,320 --> 00:18:47,760 Speaker 1: Ocean Falls. Big bitcoin mining operations are measured in the 330 00:18:47,800 --> 00:18:51,280 Speaker 1: dozens or hundreds of mega watts. But even if Kevin's 331 00:18:51,280 --> 00:18:54,320 Speaker 1: business does take off and gets bigger, it's not clear 332 00:18:54,359 --> 00:18:57,119 Speaker 1: that it's impact on Ocean Falls will grow. He is 333 00:18:57,160 --> 00:19:02,000 Speaker 1: tony again. If Ocean Falls become in the meantime more 334 00:19:02,040 --> 00:19:05,359 Speaker 1: recognizable to outsiders who see it as a place to 335 00:19:05,400 --> 00:19:09,399 Speaker 1: come that's viable, it may be just that springboard that 336 00:19:09,480 --> 00:19:12,960 Speaker 1: they need, you know, to come in, and and it 337 00:19:13,040 --> 00:19:17,480 Speaker 1: can perpetuate after that. So do I see blockchain is 338 00:19:17,560 --> 00:19:21,440 Speaker 1: being the I think once it's up and running, it's 339 00:19:21,440 --> 00:19:23,560 Speaker 1: probably not going to have a lot of people that 340 00:19:23,640 --> 00:19:28,600 Speaker 1: are needed. They haven't said, but I don't know how 341 00:19:28,600 --> 00:19:31,359 Speaker 1: many people does it take to keep a bunch of 342 00:19:31,400 --> 00:19:35,359 Speaker 1: computers running? Probably not more than just a couple, and 343 00:19:35,359 --> 00:19:37,320 Speaker 1: maybe they don't even have to be here full time. 344 00:19:38,080 --> 00:19:41,000 Speaker 1: This is something of a pattern. Governments and other places 345 00:19:41,040 --> 00:19:43,800 Speaker 1: that have attracted attention from bitcoin mine is have been 346 00:19:43,840 --> 00:19:46,800 Speaker 1: frustrated once they realize how little chance there is for 347 00:19:46,880 --> 00:19:52,119 Speaker 1: anything resembling real economic development. This isn't just a bitcoin problem. 348 00:19:52,160 --> 00:19:55,240 Speaker 1: A bitcoin mine is basically just a data center, and 349 00:19:55,320 --> 00:19:58,560 Speaker 1: companies that run data centers for other purposes have also 350 00:19:58,640 --> 00:20:01,359 Speaker 1: offered mixed benefits for the out of the way locations 351 00:20:01,359 --> 00:20:04,040 Speaker 1: they've set up. In another version of the story have 352 00:20:04,160 --> 00:20:07,200 Speaker 1: been the places where a defunct shopping mall, let's say, 353 00:20:07,280 --> 00:20:10,280 Speaker 1: will be filled with computer service and buildings that used 354 00:20:10,280 --> 00:20:13,240 Speaker 1: to house dozens or hundreds of retail jobs have become 355 00:20:13,280 --> 00:20:17,280 Speaker 1: places where wealth is generated for people living elsewhere, while 356 00:20:17,320 --> 00:20:21,399 Speaker 1: offering basically no employment opportunities for the locals. Now, to 357 00:20:21,440 --> 00:20:23,920 Speaker 1: be fair to Kevin, he didn't promise to create lots 358 00:20:23,920 --> 00:20:27,879 Speaker 1: of local jobs, but he did have plans to expand. Yeah, 359 00:20:27,920 --> 00:20:29,679 Speaker 1: he said he wanted to grow the size of his 360 00:20:29,760 --> 00:20:33,200 Speaker 1: existing mind and even to get into other types of businesses, 361 00:20:34,040 --> 00:20:36,400 Speaker 1: like he wants to use the heat from the computers 362 00:20:36,440 --> 00:20:39,159 Speaker 1: to warm up the water and the fish hatchery or 363 00:20:39,280 --> 00:20:42,680 Speaker 1: to develop novel technology for cooling computer servers that he 364 00:20:42,720 --> 00:20:46,600 Speaker 1: could presumably sell to other businesses. He's also talked about 365 00:20:46,680 --> 00:20:49,280 Speaker 1: using the paper mill as a kind of working retreat 366 00:20:49,359 --> 00:20:53,320 Speaker 1: for coders working on cryptocurrency projects, and now that might 367 00:20:53,320 --> 00:20:55,399 Speaker 1: be pleasant, but it's not clear how likely it is 368 00:20:55,440 --> 00:20:58,240 Speaker 1: to happen. Some of these ideas might work out and 369 00:20:58,280 --> 00:21:01,280 Speaker 1: bring new life to ocean falls, but Kevin's got lots 370 00:21:01,280 --> 00:21:07,440 Speaker 1: to worry about before then, throughout there was this incredible 371 00:21:07,480 --> 00:21:10,840 Speaker 1: run up in the price of bitcoin. It surpassed nineteen 372 00:21:11,000 --> 00:21:14,240 Speaker 1: thousand dollars at the end of last year. This year 373 00:21:14,440 --> 00:21:20,399 Speaker 1: has been brutal, though. The cryptocurrency is now sinking below 374 00:21:20,480 --> 00:21:23,359 Speaker 1: eight thousand and down more than six percent in the 375 00:21:23,440 --> 00:21:27,879 Speaker 1: last week, and it's getting technical analysts spooked that maybe 376 00:21:27,920 --> 00:21:30,600 Speaker 1: bitcoin has further to fall than we've even seen this week, 377 00:21:30,840 --> 00:21:32,639 Speaker 1: or people are gonna become very fearful and you're going 378 00:21:32,680 --> 00:21:35,480 Speaker 1: to see even further liquidation as people begin to understand 379 00:21:35,600 --> 00:21:38,679 Speaker 1: that the bloom is off the rose. As of this taping, 380 00:21:38,800 --> 00:21:42,200 Speaker 1: the price of bitcoin is around six thousand, four hundred dollars. 381 00:21:42,680 --> 00:21:45,760 Speaker 1: Last year, a handful of bitcoin mining companies had raised 382 00:21:45,760 --> 00:21:49,840 Speaker 1: money by going public on Canada's junior stock exchanges, Ocean 383 00:21:49,840 --> 00:21:53,159 Speaker 1: Falls Blockchain had plans to do the same thing, and 384 00:21:53,240 --> 00:21:56,920 Speaker 1: that presentation that Kevin showed investors in February, it based 385 00:21:56,960 --> 00:22:00,920 Speaker 1: its financial projections on bitcoin being worth eleven thousand dollars 386 00:22:01,520 --> 00:22:03,600 Speaker 1: back in April, when the price had fallen to about 387 00:22:05,119 --> 00:22:07,480 Speaker 1: I asked Kevin whether he was worried at the time. 388 00:22:07,480 --> 00:22:09,880 Speaker 1: He shrugged it off. You know, like Warren Buffet doesn't 389 00:22:09,880 --> 00:22:12,920 Speaker 1: look at stock traces every day. You know, he looks 390 00:22:12,960 --> 00:22:16,600 Speaker 1: at the long term sort of picture of where potential 391 00:22:16,640 --> 00:22:19,160 Speaker 1: for companies. Looking at someone like that as an example, 392 00:22:19,760 --> 00:22:22,240 Speaker 1: you know, he expands his business when you know people 393 00:22:22,280 --> 00:22:24,640 Speaker 1: aren't interested to concerning companies that he sees the longer 394 00:22:24,720 --> 00:22:28,040 Speaker 1: term potential. But it's clear that the price of bitcoin 395 00:22:28,160 --> 00:22:32,399 Speaker 1: has impacted his plans. Kevin's company decided against going public 396 00:22:32,720 --> 00:22:36,320 Speaker 1: because the interest in businesses like his had largely dried up. 397 00:22:37,520 --> 00:22:39,960 Speaker 1: He says this shouldn't be a problem and he'll find 398 00:22:40,000 --> 00:22:43,800 Speaker 1: money elsewhere as he needs it. But investors know that 399 00:22:44,040 --> 00:22:46,600 Speaker 1: there's a point at which it would become unprofitable to 400 00:22:46,680 --> 00:22:50,240 Speaker 1: keep mining bitcoin. Mosaic, a research firm focused on the 401 00:22:50,240 --> 00:22:54,320 Speaker 1: cryptocurrency industry, puts that price at five thousand dollars on average. 402 00:22:55,160 --> 00:22:57,119 Speaker 1: I asked Kevin if there was a low price at 403 00:22:57,119 --> 00:22:59,880 Speaker 1: which it wouldn't be profitable for him to mind bitcoin anymore. 404 00:23:01,000 --> 00:23:03,640 Speaker 1: He said he didn't have one in mind, and instead 405 00:23:03,840 --> 00:23:07,280 Speaker 1: he offered an optimistic rationale for how dropping prices might 406 00:23:07,320 --> 00:23:10,680 Speaker 1: actually be a good thing for him. Here's the thought process. 407 00:23:11,119 --> 00:23:14,720 Speaker 1: New bitcoins are dolled out regularly. The more minors there 408 00:23:14,760 --> 00:23:18,320 Speaker 1: are competing for them, the fewer bitcoins each minor gets 409 00:23:18,359 --> 00:23:21,200 Speaker 1: for the same amount of work. If the price drops 410 00:23:21,280 --> 00:23:24,639 Speaker 1: low enough that some people turn off their computers, the 411 00:23:24,720 --> 00:23:28,040 Speaker 1: remaining miners will have an easier time their profits rise 412 00:23:28,160 --> 00:23:31,440 Speaker 1: even if the price doesn't so. In theory, this helps 413 00:23:31,480 --> 00:23:36,399 Speaker 1: the entire system constantly find the right equilibrium, and Kevin 414 00:23:36,400 --> 00:23:38,919 Speaker 1: thinks he can power through the lean times when weaker 415 00:23:38,920 --> 00:23:42,040 Speaker 1: businesses will have to drop out. It's good for everybody 416 00:23:42,040 --> 00:23:44,720 Speaker 1: when the first goes up. From competition standpoint, it's actually 417 00:23:45,160 --> 00:23:48,240 Speaker 1: helps separate us a little bit, because we again, efficiency 418 00:23:48,320 --> 00:23:53,120 Speaker 1: is our big thing. Before leaving Ocean Falls, I discovered 419 00:23:53,160 --> 00:23:56,040 Speaker 1: that Kevin's dealing with a second complication to his business plan, 420 00:23:57,080 --> 00:23:59,760 Speaker 1: even though he's one Brent over bora lax is an 421 00:23:59,760 --> 00:24:02,760 Speaker 1: actually selling Kevin as much power as he was hoping for. 422 00:24:03,560 --> 00:24:05,600 Speaker 1: His initial plans called for them to sell him six 423 00:24:05,640 --> 00:24:07,760 Speaker 1: megawats of power by the end of this year. He's 424 00:24:07,800 --> 00:24:10,760 Speaker 1: not gonna get anywhere close to that, and that's because 425 00:24:10,800 --> 00:24:14,000 Speaker 1: Bora Lax is facing questions about the economics of operating 426 00:24:14,040 --> 00:24:17,719 Speaker 1: the damn in Ocean Falls. Situation is complicated, but it 427 00:24:17,760 --> 00:24:20,840 Speaker 1: involves the rate that bore Alex charges to sell power 428 00:24:20,880 --> 00:24:24,600 Speaker 1: to the town of Bellabella. We said earlier, the rate 429 00:24:24,760 --> 00:24:28,280 Speaker 1: is far higher than what Kevin's business pays. Bor Alex 430 00:24:28,400 --> 00:24:31,560 Speaker 1: is currently having a dispute with BC Hydro, that's the 431 00:24:31,640 --> 00:24:35,159 Speaker 1: public utility in the area that buys the power headed 432 00:24:35,200 --> 00:24:38,840 Speaker 1: for Bellabella, and until that is settled, bor Alex doesn't 433 00:24:38,880 --> 00:24:41,440 Speaker 1: want to commit to selling Kevin the amount of power 434 00:24:41,480 --> 00:24:45,760 Speaker 1: that would allow him to grow Ocean Falls blockchain. Now. 435 00:24:45,800 --> 00:24:48,200 Speaker 1: As we said, Bora Lax is giving Kevin a steep 436 00:24:48,240 --> 00:24:51,439 Speaker 1: subsidy for power because it needs an incentive to get 437 00:24:51,520 --> 00:24:54,000 Speaker 1: him to come to Ocean Falls. But one upshot of 438 00:24:54,040 --> 00:24:57,240 Speaker 1: the negotiation with BC Hydro could be that regulators require 439 00:24:57,320 --> 00:25:00,760 Speaker 1: Borelax to charge Kevin much more. You know, you do 440 00:25:00,840 --> 00:25:03,840 Speaker 1: your best to sort of navigate sort of those those 441 00:25:03,920 --> 00:25:07,240 Speaker 1: those political type of waters. But at the end of 442 00:25:07,240 --> 00:25:09,600 Speaker 1: the day, it's not something we have, you know, we 443 00:25:09,640 --> 00:25:12,399 Speaker 1: don't make the final say and things like that. This 444 00:25:12,440 --> 00:25:16,280 Speaker 1: speaks to a bigger question facing utility companies, especially utilities 445 00:25:16,280 --> 00:25:20,399 Speaker 1: that have facilities in remote places like northwestern Canada, what 446 00:25:20,560 --> 00:25:24,359 Speaker 1: is their policy on cryptocurrencies? In Quebec, regulators want to 447 00:25:24,359 --> 00:25:27,360 Speaker 1: increase the rate that miners pay for power. I think 448 00:25:27,440 --> 00:25:30,159 Speaker 1: right now you're seeing it all over the place. You 449 00:25:30,200 --> 00:25:32,640 Speaker 1: look at what's happening in places like Washington State where 450 00:25:32,640 --> 00:25:34,320 Speaker 1: there are a lot of minors on the on the 451 00:25:34,359 --> 00:25:37,280 Speaker 1: Columbia River there, and you know, there's a lot of 452 00:25:37,840 --> 00:25:40,679 Speaker 1: there were there. There's a lot of pushback from from 453 00:25:40,720 --> 00:25:43,000 Speaker 1: the government and from other businesses and that type of thing. 454 00:25:43,080 --> 00:25:45,640 Speaker 1: And so that gets us back to this original question 455 00:25:45,800 --> 00:25:48,320 Speaker 1: of what the public gets out of having a bitcoin 456 00:25:48,400 --> 00:25:51,520 Speaker 1: mine in town. Right in a place like Ocean Falls, 457 00:25:51,560 --> 00:25:54,600 Speaker 1: the utility seems to have a clear incentive to bring 458 00:25:54,640 --> 00:25:57,440 Speaker 1: a new customer in. It has this power, it can't 459 00:25:57,480 --> 00:25:59,760 Speaker 1: sell it, and here's someone who's willing to buy it, 460 00:25:59,800 --> 00:26:01,879 Speaker 1: so that it's just good. But what if there's other 461 00:26:01,880 --> 00:26:04,640 Speaker 1: people who want to buy the power? Too, And that's 462 00:26:04,680 --> 00:26:08,200 Speaker 1: a question that many utilities, many small towns in other 463 00:26:08,240 --> 00:26:11,840 Speaker 1: places are facing. Right. And once you've decided we're going 464 00:26:11,920 --> 00:26:14,760 Speaker 1: to sell this power to a data center because there's 465 00:26:14,960 --> 00:26:18,080 Speaker 1: some sort of economic benefit, there really is a question 466 00:26:18,160 --> 00:26:21,480 Speaker 1: what the benefit is. These places don't employ people, it's 467 00:26:21,480 --> 00:26:24,360 Speaker 1: not clear why another business would have to set up nearby, 468 00:26:24,440 --> 00:26:27,480 Speaker 1: and you may just end up having energy consumer and 469 00:26:27,520 --> 00:26:30,800 Speaker 1: nothing else. Right, there's no need for dependent businesses like 470 00:26:30,880 --> 00:26:34,520 Speaker 1: restaurants or hotels to spring up um And it's a 471 00:26:34,600 --> 00:26:37,560 Speaker 1: pertinent question now that towns are falling over themselves to 472 00:26:37,600 --> 00:26:41,600 Speaker 1: offer incentives to tech companies that are promising to bring investment. 473 00:26:42,440 --> 00:26:44,960 Speaker 1: And there is one bitcoin specific question that we should 474 00:26:44,960 --> 00:26:47,680 Speaker 1: deal with here too as well. Though I think most 475 00:26:47,680 --> 00:26:50,280 Speaker 1: people think that Amazon's data centers or whatever are going 476 00:26:50,359 --> 00:26:52,639 Speaker 1: to definitely be around in a couple of years, but 477 00:26:52,720 --> 00:26:54,960 Speaker 1: there's a question about whether or not a bitcoin mine 478 00:26:54,960 --> 00:26:56,960 Speaker 1: would be around in a couple of years. This is 479 00:26:57,000 --> 00:27:01,720 Speaker 1: a really volatile asset. It's speculative business, and it's not 480 00:27:01,800 --> 00:27:05,480 Speaker 1: clear if selling your energy to a company like Kevin's 481 00:27:05,600 --> 00:27:07,520 Speaker 1: is going to be any good for you in two 482 00:27:07,600 --> 00:27:10,000 Speaker 1: or three years down the road. And is that something 483 00:27:10,000 --> 00:27:12,959 Speaker 1: you asked Kevin about Yeah, I did. He is an 484 00:27:12,960 --> 00:27:16,199 Speaker 1: optimistic guy and said that, of course it would be 485 00:27:16,200 --> 00:27:19,080 Speaker 1: bad if bitcoin went to zero, but no one thinks 486 00:27:19,080 --> 00:27:20,919 Speaker 1: that's going to happen, and he's in it for the 487 00:27:20,960 --> 00:27:23,040 Speaker 1: long haul. It took a long time to a lot 488 00:27:23,119 --> 00:27:25,240 Speaker 1: of work to set this up. You know, I don't 489 00:27:25,280 --> 00:27:27,919 Speaker 1: I don't want to build another substation somewhere else like 490 00:27:28,119 --> 00:27:30,040 Speaker 1: this is. You know, I want to start running the 491 00:27:30,040 --> 00:27:33,080 Speaker 1: business now. You know, obviously, if a bitcoin collapsed and 492 00:27:33,200 --> 00:27:35,440 Speaker 1: when it came nothing, obviously that's not going to be 493 00:27:35,480 --> 00:27:37,440 Speaker 1: good for us. It's not gonna be good for for anybody. 494 00:27:37,920 --> 00:27:40,480 Speaker 1: But I think that that's uh. I think everybody agrees 495 00:27:40,480 --> 00:27:43,440 Speaker 1: that that that's that's very unlikely, but it's good at 496 00:27:43,440 --> 00:27:46,320 Speaker 1: the same time, you know, we believe it's it's going 497 00:27:46,400 --> 00:27:47,680 Speaker 1: to do very well in the long term, but it's 498 00:27:47,680 --> 00:27:49,480 Speaker 1: not going to be a straight line and it's gonna 499 00:27:49,520 --> 00:27:51,040 Speaker 1: go up, and it's kind of in the way down, 500 00:27:52,160 --> 00:27:56,000 Speaker 1: and he's taking Ocean Falls along for the ride. Three 501 00:27:56,880 --> 00:28:00,359 Speaker 1: of a century made its place and his to read 502 00:28:01,400 --> 00:28:05,639 Speaker 1: it will never be in that emold Oan Falls, but 503 00:28:05,800 --> 00:28:09,320 Speaker 1: it delves into every sodden daughter that's been in the Martin. 504 00:28:10,880 --> 00:28:15,280 Speaker 1: People are gone, but the sphere lives on. I was 505 00:28:15,359 --> 00:28:17,920 Speaker 1: born right here in this very spot. You can see 506 00:28:18,000 --> 00:28:21,119 Speaker 1: the pride in their eyes. I remember this. Do you 507 00:28:21,200 --> 00:28:31,240 Speaker 1: remember that? Here? The school caught fire? And that's it 508 00:28:31,359 --> 00:28:35,200 Speaker 1: for this week's Decrypted. Thanks for listening. We always want 509 00:28:35,200 --> 00:28:37,240 Speaker 1: to know what you think of the show. You can 510 00:28:37,240 --> 00:28:40,360 Speaker 1: get in touch by emailing Decrypted at Bloomberg dot net 511 00:28:41,200 --> 00:28:45,000 Speaker 1: or I'm on Twitter at Joshua Burwstein and I'm at 512 00:28:45,040 --> 00:28:48,360 Speaker 1: pagat Cary. Please subscribe to our show wherever you like 513 00:28:48,440 --> 00:28:51,360 Speaker 1: to listen to podcasts, and if you haven't already, please 514 00:28:51,560 --> 00:28:54,120 Speaker 1: leave us a rating and a review. It really helps 515 00:28:54,200 --> 00:28:58,040 Speaker 1: us find new listeners. This episode was produced by piagod 516 00:28:58,080 --> 00:29:02,120 Speaker 1: Carry and Magnus Hendrickson, with help from Austin Weinstein. Our 517 00:29:02,160 --> 00:29:05,960 Speaker 1: story editor was Emily Busso. Thanks to Big Jim Lewis 518 00:29:06,000 --> 00:29:07,720 Speaker 1: for letting us use his song about It, which can 519 00:29:07,720 --> 00:29:10,240 Speaker 1: falls in this episode. I also wrote an article about 520 00:29:10,320 --> 00:29:12,760 Speaker 1: Kevin and Brent. You can read it at Bloomberg dot 521 00:29:12,800 --> 00:29:15,960 Speaker 1: com slash tech and thanks to Robin Agello, my editor 522 00:29:16,000 --> 00:29:19,800 Speaker 1: on that story. Francesca Levie is head of Bloomberg Podcasts. 523 00:29:20,080 --> 00:29:23,440 Speaker 1: We'll see you next week.