SLP543 Bitcoin Mining Around the World with Seb Gouspillou

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Sébastien Gouspillou is a French Bitcoin miner, entrepreneur, and speaker. He is the CEO of BBGS (Big Block Green Services) and he joins me to talk about Bitcoin mining in the Democratic Republic of the Congo, Oman and elsewhere around the world: 

  • Bitcoin mining in the DRC
  • Bitcoin mining in Oman
  • Using various forms of energy 
  • Working in different environments
  • Narrative shifts in Bitcoin Mining and Proof of Work

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Podcast Transcripts:

Stephan (00:01.719)
Seb, welcome to the show. I know you’re doing a lot of interesting things and I’ve seen you referred to as the Indiana Jones of Bitcoin mining. So welcome to the show.

Seb Gouspillou (00:10.93)
Thank you so much. It’s an honor.

Stephan (00:16.051)
So let’s talk a little bit about your work in Bitcoin mining and you started, we’ve got some, it looks like you’ve got operations around the world, but we’ll start with the Congo. I think that will be really interesting for listeners. So can you tell us how did you end up going to the Congo and how did you get in touch with Emmanuel de Murode?

Seb Gouspillou (00:40.242)
It was at the beginning of 2020 I was contacted by a French constructor of hydro power plants He told me that a provider of green electricity in Africa was interested in mining In Bitcoin mining and he proposed meeting up at a Chateau in Angers not far from my home So we went with my associate Adrian. It was a little bit mysterious because we we didn’t know exactly

who was this client, who was this guy from Africa. And so during the meeting, we discovered that the client was the boss of the Virunga Park in Congo, in DRC. And we discovered his project, mining at a new hydro power plant. Later on the train home, we looked online and saw.

who this incredible man was, a prince of Belgium, Emmanuel de Mérode, and we saw that Virunga was the most dangerous national park in the world.

Stephan (01:52.309)
So, weren’t you scared about going and operating in the Congo?

Seb Gouspillou (01:57.682)
Emmanuel and his team were real fighters for the environment, true heroes, and they were asking us for help. So if he and his staff could work there, why couldn’t we? So we were not scared. No, we just went.

Stephan (02:23.317)
Okay, and as, you know, from what I’ve read, it sounds like there is a rebel militia in the territory, or M23 or others. Can you explain a little bit there?

Seb Gouspillou (02:35.474)
Of course, the M23 are very present. They mainly occupied the Rumangabo area. It was the headquarters of the Virunga Park, so they have to move the structure. But you don’t have only the M23. You have the ADF from Uganda, who are the most bloodthirsty group. You have the FDLR.

a rundown group who are enemies of the M23. But that isn’t all. There is the Codeco, the FRPI, the FPLC, the LRA. The jungle is infested with rebel troops, gangs in fact, who live from poaching, illegal fishing and racketeering.

There are 125, 130 groups, armored groups operating there, including the Maimai. And the Maimai, they are those small local groups who are even just the plant where we work on the Louvre River.

Stephan (03:48.02)
Yes, so there is definitely a threat there. So let’s talk a little bit, as you mentioned, the Virunga National Park. Can you explain a little bit about the context of this opportunity to go and do Bitcoin mining there?

Seb Gouspillou (04:03.448)
It was simple. It’s a global project from Emmanuel. The project is to create 110 megawatts in the region. Now they’re opening a new plant, so they will reach 60 megawatts. And when they open the last one on the Louvre River, they are not ready because…

Seb Gouspillou (04:33.362)
How to explain? At the completion of the plant, it was a very difficult period for the park financially. Eco -tourists couldn’t continue as normal, firstly because of Ebola and then COVID. And so income dropped by 40 % for the park. And at the same moment in the region surrounding the new plant,

began to become dangerous which considerably delayed the deployment of the network. You can pull the line when it’s war. It’s very difficult to send electricians in the forest. They are targets. So the revenue expected from the sale of electricity is zero. And that was when Emmanuel…

heard about mining as a last resort customer for hydroelectricity and he contacted me at this moment.

Stephan (05:36.85)
I see. And so as I’m understanding in many cases, and maybe in this case, it’s using surplus energy to mine Bitcoin. So was that the basic argument here or the basic case here?

Seb Gouspillou (05:53.818)
Yes, it’s exactly what we used to do everywhere. But in this place it was particular because it was 100 % of the capacity of production, unuseful. It had nothing to do with this electricity at this moment. Now they are pulling the lines and we take only 10 megawatts on the 15. So they have the capacity to…

to send electricity to people and the project is to reduce the mining years after years as soon as it is possible. So we buy the electricity very cheap and as soon as they are in capacity to sell electricity to population, to local industry or local factories, we have to go out. It’s a question of profitability.

Stephan (06:51.187)
I see. And so from what I understand that there are multiple hydro plants there. Is there talk, some people talk about this idea of having Bitcoin as part of using Bitcoin to make the economic case for more hydro power plants to be built. Is that the case here also?

Seb Gouspillou (07:13.106)
Absolutely not. All this project about 110 megawatts, supported by the park, is to bring electricity to the population for development and slow down deforestation. Yeah, because I did not explain, but the idea at the beginning is to stop the deforestation because the principal energy in this region, in North Kivu, is the makala. It’s charcoal.

So they cut the trees in the forest to make the charcoal. And imagine with this new energy, the electricity, they stop to use the charcoal and they stop to cut the trees. It’s really simple. So the goal of these hydropower plants is to give electricity to the population, not for mining. But the top management of the park now know that this economy…

economic crutch exists and mining can be deployed in extreme conditions very rapidly, it can be huge or very modest and it can live just as easily as it arrives, as needed. So the creation of a plant in this region will never be justified for Bitcoin alone but the fact of having a customer base is a guarantee that the loan installments are paid.

that is a game changer. In Africa, that is a real game changer.

Stephan (08:45.138)
Interesting. And so as you mentioned, this started in 2020, the mining, Bitcoin mining. How has it fared since then?

Seb Gouspillou (08:57.438)
The operation has improved over time. We now have 85 -88. We have an uptime of 88 % in December. And I believe this is one of the stormiest regions in the world. There is lightning every night. Sometimes the lightning is so intense that it seems like daylight.

at midnight. Therefore the plant often has to stop. But the teams have reduced their intervention time and we are quite proud of our result at the end of 2023. 85 -88 % is not so bad in this region.

Stephan (09:50.065)
Yeah, and so I’m also curious in terms of upfront capital investment. I presume you had to, you know, the park had to put up some money or potentially you and the company had to put up money to get mining rigs. Was that a challenge there or, you know, how did that sort of build into the case to do Bitcoin mining there?

Seb Gouspillou (10:14.262)
We share the investment so the idea The park was not reached at this moment so we invest in the first container and we bought a second container and We start only with two containers. It was during the bear market the azix were very cheap, so we spend two hundred two hundred twenty thousand dollars something like that only and but

Now we have 11 containers, so the total investment is something like 8 -10 million dollars.

Stephan (10:52.082)
I see. And so then how are you thinking about questions like mining rig useful life, right? If after let’s say four to seven years, I think, or something like this, you’re just going to have to recycle or change the mining rigs at that point.

Seb Gouspillou (11:12.466)
We repair a lot. We are so isolated that everything has to be done on site. Even the most delicate repairs. On site we have some S9 from 2016. So we can say it’s eight years. It’s crazy, eight years.

Stephan (11:30.035)
I see.

I see, yeah, so you’re just able to operate with these very old mining rigs by having on -site repairs.

Seb Gouspillou (11:38.45)
Yes, we stopped with the S9, BBGS stopped with the S9, but the power continues to manage the S9 because they don’t pay the electricity. So it’s interesting now. Yeah, it’s not a big income, but it works. So they can sell the electricity to the S9.

Stephan (11:54.834)
Interesting. And so, yeah.

Stephan (12:02.003)
Yeah, it’s kind of fascinating that it can just happen in this part of the world. And so what about the threat of, as we mentioned earlier, militias or gangs? Was there any threat that they would try to take the machines or that they would maybe threaten the Rangers or the mining operation stuff?

Seb Gouspillou (12:22.418)
The Maimais are interested in cash and weapons only, but we can imagine they attack the farm. But attacking the farm, it’s attacking the plant because we are on the plant and the plant is guarded by rangers, so it’s risky for the Maimais. The danger is on the road during the transfers. Yes, we can be attacked at every moment.

Stephan (12:52.532)
Wow, yeah, I mean, must be very confronting in that way, but I suppose you have to have armed security and the Rangers to protect the machines.

Seb Gouspillou (13:00.53)
Yes, but yeah, in the farm we are, it’s a peaceful place, but because we are with the rangers. But on the road, the rangers can be attacked by the Maimai, and it’s so fun. They lost 220 rangers for 12 years, 15 years, yeah.

So it’s very dangerous for the rangers and if you are close to the rangers you can take a bullet, yeah sure.

Stephan (13:36.148)
Yeah, confronting. But I guess just looking at this Congo project that you’ve been doing in Virunga Park overall, I guess it’s an interesting story, isn’t it? That this park turned to Bitcoin mining at the time that their revenue was low and they needed ways to make money. And this is just a really interesting story, I guess. Do you have any other thoughts to close that out or any other?

things to just share on the Viranga Park.

Seb Gouspillou (14:09.17)
Yes, we have a new project, very interesting. You know, on the first Hydro Power Plant they built, there’s a big economical activity now and they make chocolate. I don’t know if I gave you a tablet of Virunga chocolate. Next time. So now it’s a big production and they want to increase the production.

Stephan (14:26.74)
Ah, you mentioned it to me. I haven’t, I don’t think I got one though, but yeah, go on. Yeah. Yeah.

Seb Gouspillou (14:36.562)
and they need to dry the cocoa beans with a special dryer, an industrial dryer. And we imagine with Emmanuel to dry the cocoa beans with a container of mining. So we are building this container right now. And we can say in March, I think, that all the chocolate from the Virunga Park is dried by mining. So it will be the Bitcoin chocolate.

the real Bitcoin chocolate. It’s really interesting because the price of professional dryers for these cocoa beans is around 200, 300 thousand dollars. So it’s expensive and it’s only a dryer. So we bought together the small mining container, it’s 20 feet, so it’s a small one with 180 azix inside.

It’s profitable immediately, so it’s a win -win dryer.

Stephan (15:43.605)
Yeah, and that’s interesting because as I’m sure you have seen, there are some people who talk about this idea of having Bitcoin mining devices that are also a heater for the home, but in this case you’re using the Bitcoin mining for heating the chocolate.

Seb Gouspillou (15:58.642)
Yes, and in another place, not where we have the farm. Where we have the farm, we have the same project to dry something, but not to dry the cocoa beans, to dry the fruits. And you can create the leather fruits. The name is, it’s good to eat, very good to eat. And you can keep the fruits on the long term. And in Africa, you have a lot of fruits. It’s a big resource. So they lost a lot of fruits. And…

This is a potential big factory. Because you know, with the mining, we can say, OK, you take electricity, you give money, but you don’t create jobs. And it’s right. We have huge jobs. We have 15 people working directly for the farm. And with the fruits, we can imagine to have 200 people working in the factory. So now it’s the end.

It’s time to find development with this heat. Yeah, sure.

Stephan (17:02.197)
Interesting, so it’s not just a mining play now, it’s also a chocolate business that they are able to do. Yeah. Interesting, okay. Yeah.

Seb Gouspillou (17:07.378)
Yeah, and food business, yeah.

But it’s very important because all the project is to give electricity to stop the deforestation but to give jobs to people. In Congo, in North Skivu, you have 75 % of young people unemployed. So it’s very important to imagine something to give jobs. And the chocolate was a very good idea from Emmanuel. And they don’t do only chocolate. They do soap.

They do oil. So for one megawatt, you have to think the potential is to create 10 ,000 jobs for one megawatt.

Stephan (17:54.356)
Interesting. Okay. Yeah. And so, so then that aspect of it is just keeping and sustaining the park and trying to create economic opportunities in the area. So I guess there’s, you know, like you said, there’s part of it that’s Bitcoin mining and part of it that’s just other things related to how you can use that hydro power.

Seb Gouspillou (18:22.226)
Sorry, I lost you, sorry. It was cutting.

Stephan (18:23.093)
Yeah, yeah, yeah. Okay, that’s… Yeah. Yeah, that’s fine. I was just saying that there’s different business lines or different activities going there. Let’s also talk a little bit… Yeah, go on.

Seb Gouspillou (18:36.114)
Yeah, the Bitcoin mining is just a tool for Emmanuel. He’s not a Bitcoiner at the beginning. The first time he told me the name and the word Bitcoin because he used to say blockchain, the blockchain container. And I think it was…

Stephan (18:51.349)
haha

Seb Gouspillou (18:58.578)
At the beginning of 2021, he called me Saturday morning and he told me, your Bitcoin is saving the park. You told Bitcoin, Emmanuel. So it was the first time after six months he used the word Bitcoin and not blockchain. He understood that Bitcoin was helping the park, not the blockchain. But…

Stephan (19:23.581)
Yeah.

Seb Gouspillou (19:24.69)
For him, it’s just a tool. He’s not a big fan of Bitcoin or something like that. They don’t care. They sell all the Bitcoin every month to pay the people, to pay the rangers.

Stephan (19:35.241)
I see, yeah. And with Virunga National Park, has the tourism there come back up now, now that, you know, COVID and all that stuff is, all the shutdowns are done?

Seb Gouspillou (19:48.37)
Now it’s too dangerous to continue the eco -tourism at the moment. When we arrived in 2020, it was dangerous, but now it’s the real war everywhere. It’s very, very dangerous. So for the tourism, it’s impossible.

Stephan (19:54.525)
I see.

Stephan (20:07.413)
Oh, interesting. Okay, so they really do still need to keep doing Bitcoin mining as well. It’s not just like they can sort of dial the Bitcoin mining back down and just go back to tourism stuff now. They still have to keep doing that.

Seb Gouspillou (20:12.114)
Yeah.

Seb Gouspillou (20:19.41)
Yeah, at the moment mining is very important as a resource for the park. It’s something like $100 ,000 a month. So you can imagine that the government of Congo gives $100 ,000 a year to the park.

Stephan (20:35.733)
Oh, interesting. So it really makes a big difference to the financial bottom line or the financial status of the parks for them to do Bitcoin mining. Yeah, really interesting story.

Seb Gouspillou (20:45.778)
Absolutely. It’s a very regular income. Yes, for them it’s really interesting. They like it. It was a very good idea from Emmanuel. Imagine this guy. He is 54 years old, my age. He’s in the jungle, in the middle of the war. And he thinks about Bitcoin mining. Wow.

Stephan (21:13.412)
Yeah, crazy. I mean, it’s definitely different. I know you also are involved in, obviously you have Bitcoin mining projects around the world. I know you also have a project in Oman. So can you tell us a little bit about how you ended up doing Bitcoin mining in Oman?

Seb Gouspillou (21:32.146)
Yes, it was simple. We have friends in the country and one of them contacted me in 2021. He was leading a project, a big project, a data and crypto hub called Green Data City in Salala Inoman.

Stephan (21:52.691)
Great, and so this project in Green Data City, is the government involved in that mining project or is this a private project? Can you explain that?

Seb Gouspillou (22:06.258)
It’s a public -private project. The government supports the development of the Green Data City. They are facilitating the installation of industrial miners in that location. And during the inauguration in 2022, we had the Minister of IT and Transport, Sir Al Mawali. So he was present on the…

He made the inauguration of the farm.

Stephan (22:38.642)
Interesting. Yeah, we’ll put up some images of that. And so just out of curiosity, was it hard to get government permission to do Bitcoin mining? How early were the discussions around that? Like you said, that was in 2021 and then 2022 mining had started. So can you tell us a little bit about getting government permissions there and whether you faced any resistance there?

Seb Gouspillou (23:06.29)
At the beginning, the Green Data City was not for Bitcoin, was not… The project was not Bitcoin mining. The project was data centers, but it was not ready for data centers. So we offered to make mining. And the founder of the Green Data City…

made the job talking with the authorities, with the government. And basically, now you have to have an official license for Green Data City that covers the data and Bitcoin mining zone. And we signed an agreement with them for the installation of proof of concept just after the inauguration in 2022.

Stephan (23:55.827)
I see. And so what is the size of the Bitcoin mining project there and will it grow in the future?

Seb Gouspillou (24:05.458)
For us, for BBGS, we have only two containers on site at the moment, but everything is going well, so we plan to expand to 30 or 50 megawatts in the next two years. It’s not an emergency. We opened the way and we want to develop in Oman, but we have projects in Africa which are more urgent.

because they are more useful.

Stephan (24:36.883)
Interesting. And so are you able to share or if you’re not able to share, let us know. But what kind of electricity prices are they, are you getting in Oman?

Seb Gouspillou (24:49.458)
as their prices of electricity to the miners. I can say the electricity prices are competitive. It depends on the capacity. But the main criteria is that we have a fixed price in the contract for the next eight years. This is one of the reasons why we have chosen that country.

We want to avoid any risk of energy prices rising.

Stephan (25:23.858)
I see, yeah, so it’s really about the long -term stability that they can give you. And what kind of energy is it, like what type of energy are we talking about here?

Seb Gouspillou (25:35.346)
Flair gas and solar. Yes. You know, they don’t have flair gas because they built a big plant, a gas plant to make electricity. But they have not enough clients for this plant. So if they don’t use this electricity, they have to open the flair gas. So it’s a very logic project. They have electricity and flair gas.

Stephan (25:38.193)
Interesting.

Seb Gouspillou (26:03.634)
If they don’t use the gas, they burn the gas.

Stephan (26:06.866)
I see. And so I’m curious as well on the solar aspect. Does that mean you obviously must be turning the miners off at nighttime or like is it just you have to try to make the project work only in the time when the sun is shining, obviously?

Seb Gouspillou (26:26.194)
It’s a very good question. Now in this place we have gas and solar so we can take the solar during the day and the gas during the night.

Stephan (26:36.882)
I see. Okay. Interesting.

Seb Gouspillou (26:38.706)
But when you have a project only on solar, it’s exactly as you say. We have to think we work only 40 % of the day. So we have to buy very cheap asics. But it can work. I have some project in Spain, for example, working for years.

Stephan (27:02.386)
Oh, interesting. So I guess it means you have to use really cheap ASICs to make it worthwhile because otherwise you won’t be profitable on just, let’s say, 40%.

Seb Gouspillou (27:12.722)
Yes, it was totally impossible 10 years ago to do mining on the solar plants because you did not have available cheap azix. Now we have very cheap azix so we can imagine a very cheap farm on solar plants. It can exist. It exists. I know two farms like it in Russia and one in Spain. So they work only during the sunny moments.

Stephan (27:43.666)
And then I wonder, does that also get tricky with the seasons, right? If the, you know, obviously in summer is best time, but then, you know, in winter season, does that mean you just have to have the mining rigs off more?

Seb Gouspillou (27:58.866)
You want to say in Oman or?

Stephan (28:03.794)
Yeah, I guess just in general, I guess in Oman, let’s talk about in Oman.

Seb Gouspillou (28:10.8)
So in Oman it’s very interesting because there is a microclimate in the south of Oman, in the region of Salalah where we are. So you end up with between 28 and 30 degrees in July and August, while the rest of the Middle East is at 45 degrees. Another interesting point is the presence…

in this region in Salala is the presence of cold deep ocean water and this can be used for SWAC. The SWAC is the seawater air conditioning and it will be coming in 2025 in the wind data city. So the SWAC reduces the energy needed for cooling by 90 percent something like that.

It’s already used in Tai Chi, in Hawaii, in Japan, and in France, in Marseille for a data center, a classical traditional data center, for example. So we believe this location is the best place for sustainable mining in Valle region as you reduce the electricity needed for cooling the machines to a minimum.

Currently in Oman we use 6 % of our electricity for cooling and it’s a great achievement in this region.

Stephan (29:47.566)
I say yeah, because I guess that kind of flows into another question I had about how do you make it work in the climate of Oman because obviously in the Middle East it’s very hot but as you mentioned I guess you’re saying the answer is it’s this region that has a particularly good climate for Bitcoin mining.

Seb Gouspillou (29:56.114)
Yeah. No. Yeah.

Seb Gouspillou (30:03.41)
Yes, when we installed the ASIC, we got 30 degrees maximum so it was very hot in the containers but it was not the same in Dubai. When we landed in Dubai it was 45 degrees.

It’s not easy to work with 30 degrees, but with 45 degrees I don’t know how they can do. And I visited one farm in Dubai and they used hydro system from Bitmain and it was a catastrophe. They used a quantity of water totally crazy in the desert.

Stephan (30:45.231)
Yeah, so as you mentioned on Dubai there, do you have any thoughts on Bitcoin mining in the Middle East generally? Do you see it as it’s just going to be hard because of the climate or maybe it’s good for other reasons?

Seb Gouspillou (31:00.134)
It’s good because you have excess of energy as everywhere. So the mining is booming in the Middle East at the moment. We have just seen Marathon open a 201 megawatts farm with their partner Zero2. And the recent very successful IPO of the Phoenix Group at $4 billion. They also operate in Green Data City in Oman. And they are neighbors on the site.

I’m bullish of the development of mining in the Middle East, but of mining in general. Mining is useful where there is excess energy. And the Middle East has a lot of flargars, a lot of solar plants, and they are building a lot of solar plants. So yes, it’s going to become an important area for mining. But for me, it’s in Africa that the potential is the greatest, and above all,

That’s where mining is the most useful. Bitcoin mining pays 5 billion dollars a year to the electricity sector in the world. And this money will be more useful in Africa than anywhere else to support access to electricity for populations. So that’s where we are concentrating our efforts and it is why we are not in the hurry to develop in Oman.

we prefer to develop in Africa right now.

Stephan (32:31.377)
I see. And as you mentioned, you mentioned Spain, Russia, Oman, the Congo. You have…

Seb Gouspillou (32:36.57)
So Spain is not my project, it’s the project from a friend of mine, John, he’s a Spanish miner. He opened the farms in Russia only on solar plants in 2019. So we have some miners in Europe.

Stephan (32:44.241)
I see.

Stephan (32:55.043)
and one other yeah

Yeah, and I’m curious as well your thoughts on stable environment, right? And what I mean is government environment, because as I’m sure you are well aware, and anyone who’s really closely following, there was a lot of mining that went to Kazakhstan. And then what happened is Kazakhstan put in a lot of new rules and I believe new taxes that basically chased a lot of the Kazakhstan Bitcoin miners out. Do you see a similar potential with other countries? Or do you see that?

There will be certain countries who are going to commit to providing a stable environment or stable rules so that you can have a stable business case to do Bitcoin mining.

Seb Gouspillou (33:40.178)
Yes, I know very well the situation in Kazakhstan because we opened the first farm in this region in Kazakhstan in 2018 and it was a paradise. We took the electricity on the hydro power plant and we were alone. At this moment you had only one miner from… I don’t remember the name, a builder of ASICS. Valery Vavilov, do you know this guy?

Stephan (34:10.224)
I know.

Seb Gouspillou (34:10.962)
No, he is the founder of this company. So we were the only two miners in the region in Kazakhstan and we saw the many many miners coming from Kazakhstan and from China after the ban and It was very very dangerous when we saw all these miners coming without regulation we were sure it will be dangerous at the moment for the network and

In 2020, when the change of government, I think it was at the beginning of 2021, they cut the mining to identify the white miners and the grey miners. And at this moment, we saw it was dangerous to stay in this country. So we moved to Russia, all the asics we had, all the containers, and we moved to Siberia, where we had a farm for

two years, three years at this moment. So now when we come in the country, we open the country, so we explain to the government the mistakes they don’t have to do. If you let come in the miners, it’s an anarchy and they take the electricity everywhere and it can be dangerous because they can cut the electricity for populations.

So it’s the advice we gave to the government of Bukele, for example, in El Salvador. We wrote a document explaining they have to give licenses for mining. If at the beginning we have a smart regulation for mining, it’s totally win -win for the country and for the miners.

Stephan (36:05.393)
I see, yeah, so it’s about planning out and making sure that you have, that the government and whoever’s providing the power is planning out for this number of miners. I guess…

Seb Gouspillou (36:05.938)
So, do I…

Seb Gouspillou (36:16.082)
Yes, because we have to work only on surplus. You know in Kazakhstan the electricity is cheap. If you connect on the network it’s cheap and it’s enough to build a mining farm. But it’s not good. It’s not an excess electricity. It’s cheap because the government gives help to people. So the electricity is not profitable in the country but it’s cheap for people.

Stephan (36:37.2)
Like a subsidy, yeah.

Seb Gouspillou (36:45.458)
And if the miners come and take all the electricity, it’s not good. So the government has to be prepared to be ready. If they have very cheap electricity, they can accept miners, but only on the plants where they need miners.

Stephan (37:03.537)
I see, yeah. And so if you could just explain a little bit of what happened with Kazakhstan when, so my understanding is, after the China mining ban in 2020, I think it was late 2020, around September, if I recall correctly, was it 2021. Either way, after that China mining ban, there was just a massive shift of miners who went there. And then, I don’t know the exact…

rules and new regulations and taxes that came in, could you just explain a little bit about what happened there in, you know, from the Kazakhstan side?

Seb Gouspillou (37:36.274)
I think in fact they keep the Kazakhstan miners and they put out the strangers. So it is what I am understanding. But I think the new government was afraid about all these miners in the country. And because…

Stephan (37:47.73)
I see.

Seb Gouspillou (38:02.994)
We don’t have proof that mining cut electricity for people. You can read in the newspapers that the miners… because of the miners, you had the revolution. But there’s no proof about it. But the new government, after the revolution, after the push, the unsuccessful push, they decided to cut the mining and to study this business.

It was a mistake. They have to study the business before in 2017 when we came.

Stephan (38:38.129)
Right. And so then I guess bringing that more to Africa, as you mentioned, you’re obviously excited about the opportunities in Africa. Do you see a potential that a similar thing could happen that let’s say lots of Bitcoin miners all converge to a few countries in Africa and then the grid there starts to suffer? Do you see a similar potential there or do you think it’ll be different in Africa?

Seb Gouspillou (39:07.346)
Yes, it will be different in Africa, sure, because…

It’s not the same case. In general, in the countries where I work, you don’t have the network. You don’t have a national network. You had it in Kazakhstan. It was old, but it was existing. You don’t have it in Kenya, in Uganda, in Congo, in the other Congo, in Central Africa. In the center of Africa, you have in general…

less than 10 % of people having electricity at home. So it’s totally different. They are building new small networks, regional networks. And I think it’s not the same danger. And normally, we are leading the way. So we explain to the government.

Be careful about mining. It can be very interesting for the country. But you have to manage it at the beginning, now. And to identify where it’s useful, where you have too much electricity. And the hydro power plants in Africa, you have more and more. They are building the network now. So they are building the hydroelectric plants. And when you open,

Stephan (40:19.215)
I see.

Seb Gouspillou (40:38.258)
it’s impossible to have the supply and the demand at the same level. You have too much electricity when you open, always, everywhere. So mining can be very, very useful for the African countries and they are understanding this aspect now, I’m sure. We have negotiations with 13, yeah, 13 countries in Africa now.

And I think we will open two, maybe three new countries in 2024.

Stephan (41:15.054)
Fantastic. Okay. And just any other thoughts in terms of where things are going with Bitcoin mining rigs and mining machines? Do you have any sort of broad views on where the market is going to go there in terms of the development of those?

Seb Gouspillou (41:34.866)
I think the biggest development will be in Africa. But you will see big mining in Latin America too, in Argentina. You know they have a big resource of gas in Argentina. The company Crusoe is working very well in Argentina at the moment. But we have a project too in Argentina, a big one. We have a big project on flargass. We discover many, many resources of flargass.

of flagas and I think it will be the new objective of many miners to stop the flagas, to reduce the flagas.

Stephan (42:19.631)
Right, I see. And so just looking at BBGS in terms of what power sources you look for, I presume then from what we’ve been speaking about, it’s mainly hydro, flare gas, and some solar. Would that be the main energy sources that you’re looking at?

Seb Gouspillou (42:38.354)
No, we have a big project in Kenya on the… how to say in English…

are the same than in El Salvador. Correct. We can work on all types of electricity.

Stephan (42:51.178)
GFML, yeah.

Seb Gouspillou (43:02.45)
It must be regular. But we have a project in Mauritania too, in the corridor of wind. So you have wind, it’s a wind plant. You have wind 24 hours on 24 hours and maybe, yeah, every day.

Stephan (43:26.062)
Interesting. And so in the wind case, is it similar to like what we were saying with solar, that if the wind is not blowing, you have to either use really old ASIC machines or have some other form of energy that’s also going to work when the wind isn’t on?

Seb Gouspillou (43:42.098)
We imagine to have electricity 80 % of the time in this project in Mauritania. So now we will use modern asics. But it’s a very particular wind plant. It’s windy every day, every day.

Stephan (44:00.43)
Right, I see. It would only work in this particular area, maybe not in other areas. Yeah.

Seb Gouspillou (44:06.666)
about wind, absolutely. I think this kind of energy can be efficient in this region, in Mauritania, in this corridor, but in France, for example, the wind has no interest. It’s stupid to continue to develop this kind of energy.

Stephan (44:26.735)
Right, I see. Yeah, okay.

Seb Gouspillou (44:28.178)
like the Solar. Solar has a big sense in Oman or in Dubai, but in North of France I’m not sure about the interest and we know how to make…

nuclear plants so we don’t need solar and wind in France. But in Africa and in different regions, it’s important and we can do mining on all types of energy.

Stephan (44:59.215)
Yeah, it’s interesting. And as you mentioned, I mean, there’s all these countries all around the world, all with different climates, different environmental conditions. Does that represent a challenge that you have to like, your team has to figure out how to work in the desert conditions, how to work in the, you know, in the Congo, in the, you know, just the different environmental conditions. Does that mean you have to have a different setup in terms of your containers?

Seb Gouspillou (45:25.394)
Yes, I think it’s very special the BBGS way of work and it’s why we are French. When we started in 2016, we tried to open a farm in France and the second one in Ukraine in Odessa and the price of electricity was too expensive so we must move and find cheap electricity. So in 2018 I started to…

to turn everywhere in the world to find this surplus. And many people told me that it doesn’t exist, the surplus in electricity. We make electricity, the demand and the supply is the same. No, no, I’m sure it’s not. And we find surplus everywhere in Africa, in the Middle East, in central Europe.

everywhere. In Russia you have so many big hydro power plants with maybe 5 % of the capacity, working at 5 % of the capacity. In Siberia the mining is helping the region, but very strongly. So yes, we used to travel.

We know how to work in the desert, in the jungle, in the mountains. I think we are few people to have this experiment because the big miners like the Chinese miners in the past or the American miners now, they have enough megawatts in their countries so they don’t travel and they know exactly how to make mining in their country. But I’m not sure…

They are interested to discover other countries.

Stephan (47:23.886)
One other question around narratives and you know, as I’m sure you know, you know, anyone who’s been around Bitcoin for some time, the perception has been all Bitcoin mining, it’s bad for the environment or this, you know, we’ve all heard this narrative. How has your experience been with Bitcoin mining narratives and where would you say we are today compared to historically?

Seb Gouspillou (47:50.61)
I changed a lot. Yes, in 2017 or 2018 when I explained that mining was a game changer in the production and distribution of electricity, people said, this guy is crazy. It can be good to use so much electricity. So it’s changing now.

we can see more and more people understanding what is happening. And it’s from the electricity companies. They see that the miners are efficient clients. They pay every month. They consume electricity. The consumption is very regular.

So the income is very regular and they can cut the miners when they want. So it’s just perfect. If you have an isolated hydro power plant and you have this kind of client, it’s just magic. So it’s changing. We can see everywhere that it’s changing. And now Bitcoin is popular with the ETF in the finance world. So…

I’m sure in three years, four years, this question of pollution, of proof of work will be totally stupid as an idea.

Stephan (49:31.308)
Of course, yeah. And as I’m sure you know, in the EU, there’s currently some talk about the EU and the regulators and the ECB are trying to, they’re trying to attack proof of work and they’re trying to make it look like, oh, see, Ethereum is so good with the proof of stake and in their mind, obviously, I disagree with that. Do you have much, let’s say, hope that the EU is going to change their position on this kind of thing?

Or do you see it more like, well, we just need to look for opportunities elsewhere outside of the EU?

Seb Gouspillou (50:06.354)
I think they will understand that this client is very good for them. So it’s why I often explain that proof of work does not consume enough. If we have more demand, we can convince more people. And as soon as they will see in fact that the miners…

buy the electricity, the surplus, the excess electricity and give money to the country. They will accept. When we start in Oman, just before, I think two months before, the central bank explained that Bitcoin was forbidden in the country. So I asked to the authorities, is there a problem because we have this project, we are buying the ASICs.

and the central bank says it’s forbidden. They say, no, no, the central banks, they don’t make the law. We make the law. And so don’t care about the central bank.

Stephan (51:13.356)
That’s really interesting because in one way it shows that you can open doors. And when you open that door, now that there’s Bitcoin mining going on in the country, it’s going to look kind of silly that the central bank is trying to say Bitcoin is not allowed when there’s Bitcoin mining going on and the government has a public -private partnership with that entity doing Bitcoin mining. And so I think maybe it helps open the door, makes it harder to ban Bitcoin, makes it harder to stop.

Seb Gouspillou (51:18.89)
Absolutely.

Stephan (51:40.14)
people actually using Bitcoin. So in a way, that’s a really good thing.

Seb Gouspillou (51:42.066)
Yes, correct. The energy is very important. We can see it since the beginning of the war between Ukraine and Russia. Everybody began to understand that the energy is very important. So in case of Oman, for example, they have maybe 800 megawatts available. It’s a big amount of money. So…

Okay, the central bank explains it’s forbidden, but why? We don’t care. The mining is in capacity to buy this electricity and to give money to the country. So it’s just a question of pragmatism. You say pragmatism in English? Yeah, yeah. Pragmatism, yes. So I think the mining is a very good…

Stephan (52:31.212)
Pragmatism, yeah, pragmatism, yeah.

Seb Gouspillou (52:40.594)
to open a country about Bitcoin in general. But it’s a very good way to convince authorities, governments that Bitcoin is interesting. And after they understand Bitcoin, and after they can accept it.

Stephan (53:03.404)
Yeah, that’s fascinating. I think that’s a great spot to finish up. If you have any, I guess, closing thoughts or any last point you’d like to make for listeners and of course, where can people find you online?

Seb Gouspillou (53:15.09)
Yes, you know, I think the battle at the moment is the end of danger. The truth on Bitcoin is the concentration of mining in America. So I say to my colleagues in America, you can continue to develop in America, but you have to develop in other countries in the same time. So contact me. I have so many megawatts everywhere in Africa.

Stephan (53:40.076)
Well, fantastic. Well look, Seb, I appreciate you joining me and I know English is not your first language so this is a bit uncomfortable for you but listeners, hopefully you got a lot out of hearing from Seb and Seb, hope to chat again soon. Thank you for joining me.

Seb Gouspillou (53:55.922)
Thank you so much. Bye bye, Stephan.

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