The buzz in Saint-Andr: An inside look at bitcoin mining in rural New Brunswick

Nestled between a junkyard and a cedar mill in the rural community of Saint-Andr is the spot where developers expectnearly one per centof the world's bitcoin will be mined.

For the last several months, the Vancouver-based company Hive Blockchain Technologies has been building four highly specialized warehouses that will host thousands of computers.

Those individual computers areknown as "miners," and they run 24 hours a day to make their owners bitcoin.

"When this facility is complete, we'll have about 18,000 of these machines operating," said Aydin Kilic, the president and chief operating officer of Hive. "It's almost one per cent of the entire bitcoin mining network is going to be right here in Saint-Andr."

Bitcoin is a type ofcryptocurrency, adigital form of money that has risen in value and popularity around the globe in the last decade. Instead of a physical currency, bitcoin is strictly digital.

Bitcoin also operates without a central banking system. Instead, all bitcointransactions are tallied on a digital ledger called the blockchain.

Bitcoin mining operationslike the one in Saint-Andre act as the bank for bitcoin, constantly tallying the worldwide transactions on the blockchain. Bitcoin mining operations are made up of hundreds, often thousands, of computers creating a decentralized banking network.

The reward for tallying those transactionsis bitcoin. And the more computers a person or companydedicates to tallying those transactions, the more bitcoin is paid out.

That'swhy Hive has built bitcoin mines in Quebec, Swedenand Iceland, and is finishing construction in Saint-Andr.

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Rural community of Saint-Andr has fewer than 1,000 people but is host to what may become one of the largest bitcoin mining operations in Canada.

Two of the buildings in Saint-Andr are complete, while technicians arenow installing100 metresof computers, stacked seven high, in a third.

Construction workers areheatingthe frozen ground and pouring the foundations of a fourth building, which Kilic expects will be completed in the first half of next year.

Once completed,Kilic said, he expects the entire facility to mine about five bitcoina day.

Over the past year, a single bitcoin has been valued between $30,000 and $85,000 Cdn.

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Some people mightassume such an operationwould be more at home in Silicon Valley. Why build one ina northern New Brunswick community?

According to Kilic, the decision came down to four factors: afavourable tax rate, stable government, access to affordable electricity, and most important, the temperature.

"If you want to talk aboutoptimalenvironments, well, Saint-Andr isoptimal,and we love it here," Kilic said. "We've got cool, dry temperatures."

Each exterior wall of the warehousesfeatures massive slats that allow cool outside air to drift inside.

That air wafts through a wall of filter paper that runs the entire lengthof the building. Thecold filtered airthen flows directly into the mining computers, cooling them.

Once that air is heated by the computer processors,it's pushed towardthe centre of the building by the fans built into each miner. It then exits through the roof of the building. It's all done without ductwork or fans, other than the ones built into each computer.

"We've got a beautiful passive design," Kilic said. "A very novel design where we use the cool, dry climate without having to have air conditioning."

With thousands of computers running non-stop, the heatthat isgeneratedistropical, even to Saint-AndrMayor Marcel Levesque, who has toured the plant.

"It's crazy, it's crazy," said Levesque. "You never imagine seeing so many computers in a building. Never."

Air conditioning would also contribute to the astronomical amount of power being used. According to Kilic,the mining operation will eventually consume about the same amountof electricity used to power more than 7,000 homes.

"In total, thefour-buildingcampus will be 70 megawatts when it's complete," said Kilic.

Being in an area near where electricity is generated at theGrand Falls, TobiqueNarrows and Sisson damsalso factored into the decision to build in Saint-Andr.It's also near where N.B. Power transmission lines intersect, ensuring plenty of electricity for the power-hungry plant.

A few new jobs

Levesque says Saint-Andr's population is just under 2,000 people. Currently, Hive employs about 70 of them. Mostare from the Saint-Andr and Grand Falls area, and are involved in construction. When it's completed, Kilic expects the operation will employ 20 people, who will workmostly tomaintainthe miners and for security.

They includesLuc Ouellette from Grand Falls, who said that even though he'sworked at Hive fornearly twoyears, his friends and family still havea hard timeunderstanding what he does for a living.

"They don'teven know, most of them," said Luc Ouellette, Hive's regional director inNew Brunswick. "I tell them what we'redoinghere,and they really want to visitus andsee what's going on.

"It's a big opportunity for us to work locally with next-generation stuff. Being part of that is great."