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Australian Blockchain Firm Strikes $190 Million Crypto Mining Deal

Sydney-based IoT Group, an ASX-listed firm, has inked a deal with the Australian reseller of Bitfury’s bitcoin mining hardware to kickstart a mining operation if it can get a decommissioned coal plant up and running again.

In an announcement and disclosure on the Australian Securities Exchange (ASX) on Monday, the IoT Group revealed its subsidiary IoT blockchain had signed a ‘conditional binding terms sheet’ with Royalti Blockchain Group, the Australian reseller of bitcoin mining hardware giant Bitfury.

The proposed deal sees the IoT Group envisioning the development of a ‘Blockchain Applications Complex’ (BAC) in Hunter Valley, powered by the Redbank power station – a decommissioned coal plant. As reported previously, the IoT group partnered Hunter Energy in the endeavor with the latter working to acquire the power station to build the proposed mining center across two hectares. If successful, the IoT Group claims it will be able to draw energy at wholesale prices from the power station.

The deal is said to be over AUD$190 million according to a media release by the IoT Group, although disclosure compliance rules see no details of the figure present in the official ASX announcement.

According to the terms of the agreement, Royalti would install its Bitfury mining hardware at the facility provided by the IoT Group, alongside 20 megawatts of power for at least five years at 11 cents per KWh. Retail rates, in comparison, cost anywhere between 30c to 45c/KWh.

Cheap coal power could soon power cryptocurrency mining in Hunter Valley, Australia.

However, it is imperative that Hunter Energy acquires and recommissions the now-defunct Redbank Power Station to power its cryptocurrency mining operation. The coal plant was shut down in 2014.

In its ASX announcement, IoT Blockchain said:

Investors should note that the Terms sheet is subject to and conditional upon the satisfaction or waiver of certain conditions precedent, including the completion by Hunter Energy of its proposed acquisition of all right, title and interest in the Redbank Power Station to the absolute satisfaction of IoT…If Hunter does not complete its acquisition…or if competition does not occur under the terms sheet…the transaction…will not proceed.

The terms for a legally binding Power Purchase Agreement will occur no later than October 1, 2018, the announcement added.

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Aussie Blockchain Startup Tells Gov’t Its Tax Laws Are Stifling ICOs

You need nothing short of “a miracle” to succeed with an initial coin offering (ICO) in Australia, a local industry leader told the government this week.

At a Select Committee on Financial Technology and Regulatory Technology hearing on Feb. 20, Dr. Jemma Green said her blockchain firm had succeeded despite, not thanks to, government policy. 

Dr. Green is the executive chairman and co-founder of Australian blockchain energy firm Power Ledger, which develops blockchain-based software for decentralized energy trading. ZDnet reported her remarks on the day of the hearing.

Tax system not “fit for purpose”

Dr. Green appeared before the committee in her capacity as a fellow of domestic blockchain industry body Blockchain Australia. Earlier this year, Blockchain Australia published a report, together with the RMIT Blockchain Innovation Hub at RMIT University, providing detailed recommendations for the taxation of ICOs.

Drawing on this research, Dr. Green argued that current policy adversely impacts local ICOs by classifying their proceeds as income, in line with legacy tax guidelines. She stated:

“Many countries —- for example Switzerland —- are changing it to put them on capital accounts, which is moving the taxing point to when proceeds are used to build a platform which generates income. In Australia, the proceeds are being taxed as income and as a result of this, Australia is not an attractive proposition to undertake one of these ICOs.”

Blockchain Australia advocated a policy that would apply the same treatment to ICOs as that offered to firms’ proceeds from a traditional capital raise.  It would then apply this to all projects, including the early offerings that launched back in 2017.

Dr. Green pointed to the report’s findings that, while globally $26 billion has been raised through ICOs to date, Australia has captured just 0.79% of this market. 

Power Ledger, which has expanded to nine countries, owes little of its success to the government’s approach, in her view. Dr. Green went so far as to argue that:

“It’s really kind of a miracle that we exist in the first place, but there could be many of these miracles if we actually set the tax regulation around ICOs to be fit for purpose.”

Revising the system could reap benefits for fiscal revenue too, she claimed, allowing the government to capture the “bounty” when such firms become profitable. 

Speaking to Cointelegraph, Dr. Green pointed to challenges for the industry in Australia that extend beyond questions of taxation. She wrote:

“Education will play a significant role in achieving real, progressive change in Australia. We can’t expect policy makers to embrace emerging technology and a new system that they fundamentally don’t understand.”

New guidelines

As Cointelegraph previously reported, the Australian Securities and Investment Commission last year revamped its ICO and cryptocurrency trading framework. Its intervention, however, notably omitted any update to taxation and consumer protection policy, for which it referred industry participants to existing approaches as determined by other regulators.

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Credits Blockchain Platform Joins Oracle for Startups Program

  • The Credits blockchain platform has announced that it was recently included in the Oracle for Startups Program. The collaboration is intended to allow the blockchain project to combine its technological solutions with those developed by the leading cloud services provider.

The collaboration agreement between the Credits decentralized solutions provider and the Oracle for Startups Program is an important step in the development of the blockchain project and can open new opportunities for the platform by extending its solutions onto more markets with the addition of world-class cloud services. Given that Oracle Cloud solutions provide an optimal environment for launching nodes, the Credits platform will be able to offer new services to the video games, cloud storage, royalty program, and other business sectors.

The Oracle for Startups program is a specialized accelerator launched specifically for establishing partnerships and collaboration between startups and potential business partners alongside Oracle itself. The program offers free cloud storage services to its participants and a network of consulting services from mentors and experts. The scope of products offered by the project includes Oracle Cloud Infrastructure, Oracle Blockchain, Oracle Autonomous Database, Oracle Analytics Cloud, Container Engine for Kubernetes, Oracle Integration Cloud, and many more.

The Credits blockchain platform is one of the leading decentralized services providers for a broad range of industries, including video gaming, petrochemicals, supply chain management, logistics, and others. The blockchain infrastructure developed by the Credits platform operates on the basis of the innovative PoA algorithm with lightning-fast transactions cost.

The cooperation between the Oracle for Startups Program and the Credits platform is set to expand the project’s capabilities and is an important milestone in its development. The combination of solutions offered by Oracle and Credits could mean the advent of a unified decentralized and cloud technology that would be attractive to a large number of businesses from a variety of industries.

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Canaan and Northern Data Join Hands to Work on AI, Blockchain and Datacenters

The world’s second-largest Bitcoin mining company Canaan recently announced a new partnership with Bitcoin mining and datacenter company Northern Data AG.

What do the two firms plan?

In a joint press release, the two companies stated that they would bring their resources together to work on data center operations, blockchains, and the development of artificial intelligence (AI) technology. They didn’t provide any further details about their business arrangement. Northern Data was previously known as Northern Bitcoin but changed its name after merging with Whinstone US, a datacenter developer, in 2019.

Canaan and Northern Data Join Hands to Work on AI, Blockchain and Datacenters

NG Zhang, the CEO of Canaan, released a statement, acknowledging the rich experience of Northern Data in creating high-performance computing infrastructure. He said that the research and development team from Canaan would collaborate with Northern Data but didn’t reveal any more details about their shared plan.

Northern Data on a partnership spree

The latest partnership with Canaan points towards the growing crypto ambitions of Northern Data. After the high-profile merger with Whinstone US, the company is now working towards the creation of a new Bitcoin mining facility in Texas. The company said that their Texas facility would be “the largest data center in North America and the largest Bitcoin mining facility in the world.”

It also inked a partnership with SBI, a Japanese mining firm, earlier this month. SBI Crypto will be one of the first companies to be located in the Texas mining center.

Texas is now amongst the favorite locations for Bitcoin miners in the US. Several companies are planning to lay the foundation of their massive mining farms in the state. Canaan rival Bitmain also launched a humongous 33,000-acre facility in Rockdale last year. Another company eyeing the lucrative mining gains is Layer 1. The firm, which is backed by PayPal co-founder Peter Thiel, opened a mining center in Texas this week.

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