Winklevoss Capital, Peter Thiel’s Founders Fund, and Polychain Capital Back Bitcoin Mining as Digital Flare Mitigation Services
Crusoe Energy Systems, which converts natural gas to energy-intensive computing from its Denver base, has landed capital to build a new bitcoin mining facility.
The company plans to install 70 units next year, each having a capacity of about 1 megawatt (MW). Chase Lochmiller, Crusoe CEO, told Bloomberg in an interview on Saturday that Crusoe raised $70 million in fresh capital to fund its projects.
The new capital comes from two rounds, including $30 million in equity funding and $40 million in project financing. Bain Capital Ventures, already an invstor in Crusoe, KCK Group, Peter Thiel’s Founders Fund, Winklevoss Capital, and Polychain Capital took part in the fundraising. New York-based credit fund Upper90 led the $40 million round.
Winklevoss Capital participated in Crusoe’s $4.5 million seed round in May, which was led by Bain Capital Ventures.
Energy companies burn off excess gas when they do not have adequate pipeline capacity. Crusoe plans to use about 10 million cubic feed a day of gas which otherwise would have been wasted.
“It’s a very creative way to solve an environmental and economic problem for the oil and gas industry,” Alex Urdea, the chief investment officer of Upper90, was quoted as saying in the report.
“Today’s announcement paves the way for Crusoe to deliver the energy industry with a scalable solution for the natural gas flaring challenge and to execute our vision of a low-cost distributed computing cloud,” said Chase Lochmiller, CEO and co-founder of Crusoe. “The Crusoe team could not ask for a more supportive group of investors, and we are excited to deploy this new capital into our rapid scale-up of our Digital Flare Mitigation technology throughout North America.”
Crusoe has demonstrated its capability for high-caliber, safe and efficient operations since we led the team’s seed financing in early 2019, said Stefan Cohen, principal at Bain Capital Ventures. “Over this time, we’ve gained confidence in Chase, Cully and the growing Crusoe team, and strongly believe in their ability to tackle the energy industry’s flaring dilemma in this next stage of company growth. There is now a proven and scalable alternative to flaring, and Crusoe’s trajectory is also poised to produce exciting new cloud computing resources for the technology industry.”