Parallels Between Bitcoin Mining and Upstream Exploration

Featured in NAPE Magazine, Weaver’s Tim Savage, Partner, Tax Services, has a Q&A with Giga Energy’s, Brent Whitehead, on the similarities of bitcoin mining and oil and gas exploration activity. The two discuss comparisons between upstream production and bitcoin mining as well as the similarities from a risk standpoint.    

• “SAVAGE: We’ve discussed some of the similarities between upstream production and bitcoin mining, but how do you draw parallels from a risk standpoint?
• WHITEHEAD: Both industries are very similar in regard to being extremely capital intensive. The winners are decided long term by who has the cheapest cost of operations and who has the best entry point. A good example of this would be how important it is to have a cheap cost of production for an oil well to weather the oil industry’s ups and downs while also weighing the risk of your entry point when purchasing oil wells at peak oil prices.”

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