VIRGINIA BEACH, Va. - Bitcoin is the hottest currency in the world. In the past year, the price of Bitcoin has risen 600 percent. BCause, LLC, a Virginia Beach company is making its mark in the industry and has become known worldwide.
The company is expanding and opening an 84,000 square feet facility to mine cryptocurrency, including Bitcoin. On a Tuesday afternoon, workers are inside connecting cables, assembling racks and setting up computers. The company just finished phase one out of three and more than 11,000 computers have been set up.
"Each computer can do 14 trillion calculations per second," said Thomas Flake, one of the founders.
BCause is building the world's first full-stack cryptocurrency ecosystem where people can mine cryptocurrency, trade exchange it for money and in the future establish a derivatives clearing organization if the U.S. Commodity Futures Trading Commission gives them the okay. Flake believes this facility could make Virginia Beach known for cryptocurrency operations.
"This little Southeastern non-tech area of the country, which is a stereotype. But around the world, they don't see it that way. They see this as the heart of something big in the cryptocurrency world," said Flake.
But what is cryptocurrency? Bitcoin, the first and most popular cyrptocurrency, currently costs more than $7380 for one. Cryptocurrency is money online you can buy or sell. You can use it to buy things and companies including Microsoft, Overstock.com, Expedia and more accept Bitcoin as a form of payment.
"The reason I think it's important today is there are valid reasons to use cryptocurrency. Like if you want to send money overseas, it's much easier and cheaper than say sending it via Western Union," said Flake.
A study done in 2016 by Facebook and a team of researches found 92 percent of millennials don't trust banks.
"Today a lot of those folks, still don’t trust centralized institution for fear of what actually happened in 2008. Cryptocurrency allows people to sort of decentralize, to not use banks, but still have a lot of the banking functionality," said Flake.
That's where mining and BCause's facility comes into play. Mining has two pieces. The first is the movement of pieces of value from one account or ledger to another. That is a calculation made by a computer. The second and harder part to understand, in creating that calculation, the first person to do so gets rewarded with additional Bitcoin. That’s the creation of new cryptocurrency.
People can also lease computers at BCause's mining facility. Each computer is estimated to produce $15 of cryptocurrency a day and there are more than 57,000 computers. Flake believes that decentralization is what makes cryptocurrency more secure.
"I think the thing we're proudest of is our response from the industry. We thought it would take us 18 months to fill the facility. Right now the facility is over 50 percent over subscribed, so we have to get a second facility," said Flake.
The company has also gotten a strong response from the city of Virginia Beach, who gave them a $500,000 grant. The facility cost about $30 million to build, but to Flake that grant is more of a vote of confidence and a statement from the city that BCause is a business they are encouraging.
"We've been hearing we need to diversify away from the Department of Defense and tourism. This is what success looks like," said Flake. "It's not just Because, it’s companies like Leesa, and IV Watch. Five or six companies from that time that were a direct answer to that strategy."