His business card states: “Satoshi Nakomoto’s Siberian representative” - nice catch for anyone who is in bitcoin business, but actually it’s a nice marketing joke. Uriy Dromashko is promoting bitcoin concepts in East Siberian city of Irkutsk and is about to launch an industrial bitcoin mining farm which makes all bitcoin world pay close attention to what is about to happen near lake Baikal - the world’s biggest and deepest freshwater reserve and a place where electricity prices hit the global bottom.
Cold climate and world’s lowest electricity costs make this place the most profitable bitcoin mining site in the world. That’s what made Uriy crazy about mining, as an already successful entrepreneur and business owner, he is going to take this opportunity and invites local and international investors to share this lucky opportunity with him.
Today we meet Uriy in his karaoke bar to get the first interview and find out what are the plans of his mining operation.
Q.: Uriy, what is all this bitcoin business about?
A.: (Taking hookah puffs) I call myself representative of Satoshi Nakomoto, and I see it as truth, because I work on popularization of bitcoin concept in Siberia, I have pages in social networks, I make videos, they are garbage, but the idea is clear, my mission is to attract attention to bitcoin.
Q.: By doing so you make your stand in Russian bitcoin community.
A.: Yes! I’ve already found my place in all this. The best and coolest miners of Russia came over to shake hands with me, when they found out that I’m Satoshi’s representative asking me: “How is that possible that you are Satoshi’s representative?” I told them: “Common, guys, where is your sense of humor?” (laughing) They relaxed after they realized that it’s just a marketing move.
Q.: So, how can we introduce you to bitcoin community?
A.: My whole life I’ve been enterprenuer, I operate several businesses, but I want people to contact me about bitcoin, I started something new for myself. I can host mining equipment because I found a solution for cheap energy here. Also other risk are totally manageable and low.
Q.: Cheapest after Dubai and Venezuela?
A.: Well, it’s not totally true. Electricity for industries is still expensive here, but it’s cheapest in the world for some local businessmen, including me (smiling). This is my key message to the world of bitcoin. I would like international community to see this information, especially those who can invest into at least thousand miners or more, I can easily host them in my farm.
Q.: They can just contact you via facebook?
A.: Everybody is welcome! facebook.com/ura.dromashko
Q.: It’s been about half a year you’ve been mining for yourself?
A.: No, actually we started in November 2016, not long ago. I also started selling miners to the locals as a business, and during that I was looking for cheap electricity and we found it. In february we plan to start our first farm, we put all our miners together and start hosting other people’s miners. I’m developing several sites where we we will host our miners and accept miners to host from other people. This year I plan to start using 50 megawatts of electricity per hour, I think it’s about 10% of all mining in the world. I can provide this amount of electricity, but we need some international player to come in.
Q.: 50 megawatts? This is unbelievable!
A.: Actually this is the power I can actually provide right now. Some places lack some electrical equipment, but soon enough I’m solving this problem. 50 megawatts is real right now, basically. I’m also looking at additional 100 megawatts which I can put my hands on during future couple of years. Frankly even more, but I need to start using first 50 Mwatts first, then we will see.
Q.: Bitcoin community of the world will be happy to hear that.
A.: But they all are afraid to invest in Russia, this is the problem.
Q.: The more the risk the more there is to win, everybody understands that. The risk is less, if they do business with you.
A.: Maybe, and I hope, someone will look into that. I know that there are internationals who put their miners in Russia. Some Russian bitcoin business people, who are doing mining for several years now, are already managing to put 3000 machines here. They do it with my help.
Q.: Some mining operations lose their profitability over time.
A.: My calculations state that if you don’t sell bitcoins everyday, and reinvest in bitcoins, selling only at the peak prices, which was possible in December 2016, you can return your hardware and maintenance costs in less than 10 months. Looking at past year prices peaking at USD 1100 for 1 bitcoin, it was possible to return your mining investments in 6 months. If you monitor the market, and learn to catch these waves, you can significantly improve your ROI performance. You need to look at a little bit longer periods. There is always a wave coming up each year. It is not necessary a tsunami, but you can get a good exchange rate if you are patient. Anyway, if you don’t look at it precisely, its growing anyways. Of course there is an element of luck in fast ROI. The good thing is that the risk of total failure is super minimal.
Q.: Does your karaoke bar accept bitcoins?
A.: It’s going to happen soon. (Smiling) We’ve already ordered a bitcoin sign. The deal is that we cannot accept bitcoin officially, but everybody understand, that catching bitcoin transaction is almost impossible, and we won’t transfer millions of rubles daily, the sums are going to be low. The aim, again, is to promote bitcoins locally.
Q.: What about other cryptocurrencies? Do you see yourself mining other coins?
A.: I talked about this to several experts online and personally, it looks like the professional way is to mine only bitcoins. It is better to focus on one currency and I believe in that. They are talking about some machines which can choose what currency to mine and they make it even more profitable, but it is something new. I’m going to host some of those intelligent miners in the future, one of my friends is looking into that. I know some people who are investing millions of dollars into mining other cryptocurrencies than bitcoins, and maybe I will check it out soon. I will let you know.
Q.: So what miners do you use in general? There is GPU mining, and special bitcoin miners, which do you prefer?
A.: We built one GPU miner, but the most profitable, in my opinion, is ASIC miner. We work with Bitman. It’s hard to work with other manufacturers due to customs regulations. Bitman shows great service and their goods are imported into Russia with no problem. Importing from China is always easier compared to USA or European Union.
Q.: Did you use bitcoin to pay for anything?
A.: Of course. I pay for miners, and for services related to them. I try to use dollars, but my partners probably like bitcoins more (smiling), that’s why I have to use them. Once I had to pay back one debt with bitcoins. That person asked me to pay him with bitcoins. Also I accept bitcoins for the equipment that I sell. More and more I come up to using bitcoins to pay for different things in everyday life. If you are into our community you get to use bitcoin payment almost everyday. I also ordered a plastic card where money is kept in bitcoins. In Russia there is no law about cryptocurrencies, and bitcoin is treated as foreign currency. Also you don’t have to declare transactions made in bitcoins. In other words if you have a bank account in foreign country you have to declare it with Federal Tax Service of Russia. With cryptocurrencies you don’t have to do that. So it’s even better now. It means I have a foreign bank account, but I don’t have to declare my money which I keep there.
Q.: You sell miners.
A.: Yes, It’s part of my popularization of bitcoin strategy. Because if you don’t trade this equipment, you are not totally into this business.
Q.: Is it worth to buy one miner?
A.: Of course! It doesn’t matter how many miners you have. There are people who buy one and they are happy with that passive income it provides them. I know people who run 3 miners and it’s a great investment for them. For example barmen in our karaoke bar, they cannot invest 1 million rubles, but they can invest 100 thousand roubles and it gives them relatively good support.
Q.: Is it possible to buy a miner with installment payment?
A.: No, if this was possible I would buy miners like that by myself, 100%! Because the possibility that everything will go fine in this business is super high. Things will go bad, only if there is a global electricity take down, or a global nuclear war. Actually I think small wars make bitcoin grow, because instability in conventional currencies increase demand for bitcoin and its transactions. Even if bitcoin price goes down it gradually goes up again and again, we already saw that after big hacks and other bad things.
Q.: Do you have experience with darknet markets?
A.: No, my interest lay beyond trading guns and narcotics. I don’t buy or sell these things. I agree that this idea of free trade is great, and I feel sorry for Ross Ulbricht. For example some people sell axes and knifes, but it’s not their fault that some Raskolnikov killed some poor old lady with an axe. I think this is all about the state fighting against anarchists. Governments want to control everything and have everything standardised and in order. Bitcoin is a big problem for them in taking total control over things.
Q.: Is there a political risk in Russia? It looks like we move towards totalitarianism.
A.: I don’t think so. Putin cannot do anything bad to bitcoin. There are no such trends in Russia right now. There is a financial spring in Russia nowadays. If they will prohibit mining and bitcoins, people will just go hiding as usual and nothing will change. I would be more afraid of the global elite, because they have more influence in this field than our own government. Americans, for example have more control over our computer devices than anyone in our country. If globals will push prohibition, of course it will decrease the price of bitcoin, but not for long.
Q.: Do you think about creating some sort of trade platform?
A.: No, I don’t even think about importing mining equipment into Russia. This is some other people’s business. I’m only interested in mining. It looks like the most profitable to me. Mining and reinvesting in bitcoin currency. I sell machines only to make this more popular. If people will buy 1000 machines from me, most of them will place them on my farm. This is my key opportunity that I have. Even the most rich business man in Moscow don’t have this opportunity. Only a few people in Russia have this kind of offer to bitcoin mining community. And I don’t want to compete with people who import miners, it’s their business, and it’s working and I have another type of business.
Q.: So, I buy a miner and place it on your farm.
A.: Even thousand of miners and more!
Q.: You take percentage from mined bitcoins?
A.: There is a set price for every type of miner. The price includes electricity, maintenance, some other important services, you will have to pay for repairs only if they occur. We have Bitman representatives in Irkutsk and they take care of repairs. They are opening a Russian certified service center soon, and it will be located here in Irkutsk, which is a huge bonus for us.
Q.: So mining it is.
A.: Mining in Irkutsk is going to become the most profitable in the world. It looks like this situation is not going to change. Our region in in excess of energy resources and it looks like no industry is going to be created to take use of this advantage. In other words our electric plants make too much electricity, and they cannot find a customer for it. That’s why the prices stay low and are not growing even at inflation rate. There is not enough of demand for electricity in our region.
Q.: All of this is totally amazing. Thank you very much for this interview.
A.: I would like to add one more thing. This is a message to foreign investors. Please don’t be afraid to deal with Russia. Forget all the stereotypes and welcome to Irkutsk - a new world best bitcoin mining opportunity. People like me are ready to do serious business on international level, please contact me directly for more information.
