Luxor Technology aims to simplify the complexities of Bitcoin mining. With a comprehensive suite of products including mining pools, hashrate derivatives, data analytics, and ASIC brokerage, Luxor is committed to empowering miners—regardless of size—to enhance their operations.
Aaron Forster, the company’s Director of Business Development, joined Luxor in October 2021 and has witnessed remarkable growth within the team, expanding from approximately 15 to 85 employees in just over three years.
With a decade of experience in the Canadian energy sector, Forster brings valuable insights to the Bitcoin mining landscape. His expertise positions him to discuss the future of mining in Canada and the U.S. at the BTC & Mining Summit at Consensus on May 14-15, 2024.
In anticipation of the event, Forster shared his thoughts with CoinDesk on Bitcoin miners adopting artificial intelligence, the increasing sophistication of the mining industry, and how Luxor’s products enable miners to mitigate various risks.
Mining pools play a crucial role by allowing miners to consolidate their computational resources, ultimately increasing their chances of earning Bitcoin block rewards. Forster explains, “Mining pools serve as aggregators that help reduce the variance associated with solo mining. Solo mining resembles a lottery; while one might strike it lucky tomorrow, it could just as easily take decades. As operations scale, this becomes a significant concern, particularly when businesses are built around it.”
The traditional mining pool model, known as Pay-Per-Last-N-Shares (PPLNS), does not compensate miners unless the pool successfully finds a block, which introduces revenue volatility for larger industrial miners.
Luxor operates alternative models like Full-Pay-Per-Share (FPPS), which offers revenue certainty to miners by paying them for the shares they submit, independent of block discovery—as long as hashprice remains stable. Forster notes, “We’ve effectively become an insurance provider, but this model requires a robust financial foundation as we absorb the variance risks that miners face.”
Luxor’s foray into ASIC brokerage further demonstrates the company’s commitment to supporting miners. Forster explains that Luxor has established itself as a leading hardware supplier on the secondary market, facilitating transactions for clients ranging from public companies to individual miners across over 35 countries. “We primarily act as brokers, connecting buyers and sellers, while occasionally engaging directly with ASIC manufacturers,” he states.
Additionally, Luxor pioneered the introduction of hashrate futures contracts, offering a platform for miners to hedge against price fluctuations or speculate on future hashprice trends. “With these contracts, miners can sell their hashrate forward and receive Bitcoin upfront, providing them with immediate capital for operations,” Forster explains. This innovative approach allows investors to engage with the mining sector without the need for physical equipment, creating a mutually beneficial marketplace.
Forster expresses enthusiasm about the evolving intersection of Bitcoin mining and artificial intelligence technology. He notes, “We’re beginning to see major miners transition from merely mining Bitcoin to providing the necessary power infrastructure for AI applications—an exciting development that enhances the industry’s reputation and acceptance.”
As Luxor charts its course ahead, the company’s product roadmap reflects this convergence, indicating an upcoming integration with AI technologies while continuing to support Bitcoin mining operations. Forster concludes, “We are at the early stages of exploring the high-performance computing (HPC) space, where the advancements we make in mining could be paralleled in the AI sector.”
