Jack Dorsey’s Block is developing an open-source Bitcoin mining system

Block, the Jack Dorsey-led payments company (formerly known as Square), wants to democratize access to Bitcoin mining by building an open mining system. This comes amidst fears that Bitcoin mining is becoming too centralized.

Block is building an open Bitcoin mining system as it continues to expand beyond its core payments business and embraces CEO Jack Dorsey’s passion for crypto.

In a tweet thread, Block general manager for hardware, Thomas Templeton, says: “We want to make mining more distributed and efficient in every way, from buying, to set up, to maintenance, to mining. We’re interested because mining goes far beyond creating new Bitcoin. We see it as a long-term need for a future that is fully decentralized and permissionless.”

Dorsey expressed a similar sentiment, “We want mining to be as easy as plugging a rig into a power source.”

Having initially floated the idea in October, Dorsey has now tweeted confirmation that the Bitcoin mining plan is going ahead.

Templeton says Block has been investigating the customer pain points and technical challenges faced with Bitcoin mining and how these can be addressed. In addition, the company is building out a core engineering team to work on the system.

“In October, we announced that we’re considering building a Bitcoin mining system, out in the open & alongside the community, and we’ve decided…we’re doing it! We thought we’d share some more details on how our initial discussions are going and where we’re headed next,” he tweeted.

Mining has been growing increasingly complex, concentrating efforts on a small group of miners for whom mining at scale is financially viable.

Block’s initial foray into hardware came in July 2021, when it announced that it was building a Bitcoin hardware wallet, intending to make “Bitcoin custody more mainstream.” Templeton has said that the mining system will be power-efficient.

They started developing a vertically-integrated mining system with two questions. The first one is, “What are the customer pain points today?” and the second, “What are the specific technical challenges?” The mining community obliged with three chief factors: reliability, performance, and availability. The top pain points were reliability, heat dissipation, dust, and the constant need to reboot mining machines.

Concerning performance, it was highlighted that some mining rigs inject harmonics into the power grid, which can be detrimental for grid equipment. Lastly, the sourcing, cost, and unpredictable delivery times for mining rigs mean that mining equipment can be challenging to obtain.