In Partnership with Blockware Solutions

Since its creation and release in 2009, Bitcoin has grown from a cypherpunk experiment to a mainstream financial instrument. It has outperformed nearly every other asset class, drawing in retail investors, institutions, and even governments. Yet, despite its explosive price action, the real story of Bitcoin lies beneath the surface in its mining.

Mining is the invisible infrastructure that keeps Bitcoin alive. It is the global competition to validate transactions that secures the Bitcoin blockchain, and release new Bitcoins. Without miners, there is no Bitcoin ledger and no decentralization. The process is energy-intensive, but it is also what makes Bitcoin incorruptible.

For years, mining was closed off to all but the most technically skilled. It required specialist machines, low-cost electricity, and the ability to maintain operations at an industrial scale. That world is changing. Companies like Blockware Solutions have opened the doors to investors who want exposure to mining without having to become engineers themselves.

In this deep dive we’ll explore how mining works, why Blockware Solutions matters, and how they are positioned as both a leader in Bitcoin mining and a bridge to the booming world of high-performance computing (HPC), the core infrastructure that is powering AI.

(Oh, and you can use code 'DEEPDIVE' for $100 off your first Bitcoin miner)

At the heart of Bitcoin’s value proposition is its fixed supply. This supply is hardcoded into the Bitcoin protocol and network, which has two core metrics to consider that drive the entire supply narrative of Bitcoin. There is a scarcity problem that is set to get even worse:

Where this scarcity becomes more intense is that as of late August 2025, roughly 19.8 million Bitcoin have already been mined. Out of this 19.8m, 1m Bitcoin remain locked in the Bitcoin network that are believed to be owned by the original anonymous creator of Bitcoin - Satoshi Nakamoto. This allocation remains untouched. It is also estimated by one of the hardware wallets, Ledger, that between 2.3 and 3.7 million Bitcoin have been permanently lost or destroyed. Taking an average of 3 million Bitcoin, this means from a supply side there are: 

As a result, Bitcoin has a supply challenge - but how about the other side of that equation? 

In January 2024, 11 Spot Bitcoin ETFs (Exchange Trade Funds) were approved and launched on Wall Street simultaneously, bringing Bitcoin into product offerings of many well-established and respected Financial Institutions - such as Blackrock, Fidelity and Grayscale. This was after many years of tough negotiation with regulators. In just over 18 months the collective Spot Bitcoin ETFs now control more than 7% of ALL bitcoin supply (1.4k Bitcoin valued at ~US$169billion). Sovereign governments, including the US, the UK and even El Salvador are getting in on the act. 

BitcoinTreasuries.com part of the cryptocurrency exchange Bitbo.io breaks this down further with support from the Bitcoin community to confirm that as of 20th August 2025, Bitcoin holdings in publicly traded and private companies, ETFs and countries comprise:

(You can get more granularity of the data on the BitcoinTreasuries.com website)

Mining ties these forces of demand and supply together. Miners play a crucial role in securing Bitcoin’s network. They validate transactions and, in exchange, earn Bitcoin rewards and transaction fees. But there’s an additional kicker that takes place. The difficulty of mining Bitcoin automatically adjusts to maintain system balance. Every two weeks, the network recalibrates to maintain a ten-minute block time. If more miners join, usually driven by a rising Bitcoin price,  the mining difficulty rises. If miners exit, usually when the Bitcoin price starts to fall, the difficulty falls. It is this mechanism that ensures Bitcoin’s long-term stability, regardless of market volatility.

In short, mining is not an optional feature of Bitcoin, it is the heartbeat.

At its core, the model is designed for simplicity, where investors own the machines, while Blockware handles the heavy lifting.

The process starts when investors purchase dedicated ASICs like the Bitmain S21 Pro. Instead of running them at home, with the inevitable noise and heat, these rigs are shipped to Blockware’s industrial sites. There, power and cooling are managed professionally. Once online, these machines join mining pools, which are designed to help smooth out rewards. Finally, payouts flow directly into the investor’s Bitcoin wallet, with Blockware never taking custody.

This approach appeals to those who want exposure to Bitcoin mining without the logistical headaches of operating noisy, power-hungry machines themselves or getting involved in the technical management. It blends ownership of a tangible asset with the benefits of a passive Bitcoin income stream.

To target US$10,000 per month in Bitcoin income, an investor today would need around 50–60 modern ASICs. At $3,000–$4,000 each, this translates into an upfront outlay of roughly $200,000–$300,000. At Bitcoin prices of $110,000–$120,000, such a fleet could realistically generate close to $10,000 per month in gross payouts.

Tax benefits further sweeten the structure. Mining rigs can be depreciated 100% in a single tax year thanks to new guidelines from the big beautiful bill qualifying mining hardware for accelerated depreciation. That's right, miners can be 100% written off in year one under current U.S. legislation (Please note, readers should seek external tax advice from their external professional tax advisors to confirm this as Blockware is unable to give taxation advice). Hosting contracts may also qualify as deductible expenses. And unlike many tech purchases, ASICs tend to retain value.  After a year, they typically hold 50–75% of their cost, with resale values often spiking in bull markets.

This combination of recurring Bitcoin yield, tax efficiency, and residual hardware value give a blended structure to the Blockware model that may work for both retail investors and family offices, depending on your risk tolerance.

Blockware does not operate in isolation, as the global mining landscape has shifted dramatically over the past five years.

In 2021, China banned Bitcoin mining, forcing miners to relocate. The U.S. quickly became the new epicentre, with states like Texas and Kentucky competing to attract operators with tax incentives and cheap energy contracts. Today, more than one-third of global Bitcoin hashrate (ie the global mining power) resides in the U.S., a shift that has brought both opportunity and scrutiny.

Alongside America’s dominance, the ESG debate has intensified. Critics point to mining’s energy use, while supporters argue it accelerates renewable adoption by monetizing stranded power. Blockware has leaned into efficiency, designing facilities that maximize airflow, reduce cooling needs, and increasingly tap renewable sources.

Financially, the sector has matured. Where mining was once financed on debt-heavy balance sheets, it now relies on a mix of equity, institutional partnerships, and integration with broader data centre markets.

Mining is not without risk. However, those risks are built into Bitcoin’s design rather than imposed externally.

Investors often weigh this simple question: is it better to mine Bitcoin or just buy it outright? History shows mining often wins out in bull cycles. Between 2020 and 2024, Bitcoin’s price climbed by around 627%. Mining returns, however, were closer to 971%, and when resale value of rigs is included, exceeded 1,000%.

The reason is twofold: 

Miners mine Bitcoin at cost, and they own hardware that can appreciate when demand surges. Holding Bitcoin provides exposure to price alone. Mining, by contrast, delivers both yield and asset upside.

Retail Investor: An individual buys two ASICs for $8,000 and hosts them with Blockware. Over the course of two years, they earn 0.081 BTC, worth $9,500 at $115,000 per Bitcoin. Even after hosting fees, the investor outpaces a simple buy-and-hold strategy because they also retain rigs that can be resold on the Blockware Marketplace.

Institutional Investor: A family office deploys $5 million into mining machines. They receive consistent Bitcoin yield, depreciate assets for tax purposes, and diversify their portfolio with a non-correlated income stream. In addition, they gain exposure to infrastructure that can be used later to pivot to AI/HPC (High powered computing) workloads.

Bitcoin is Blockware’s foundation, but it is not the end of the story. The same infrastructure that powers Bitcoin mining, most notably cheap energy, specialised chips, and advanced cooling, can also fuel the high-performance computing (HPC) revolution that supports the training of AI-based models.

In 2023, Blockware launched the Nodestream Marketplace, a transparent platform for buying and selling GPU-dense servers. This move positions Blockware not just as a mining host, but also as a broader compute infrastructure provider.

The logic is simple. Artificial intelligence is driving unprecedented demand for GPU compute. In 2025, for example, CoreWeave acquired Core Scientific for $9 billion, not for its Bitcoin output but for its data centre infrastructure. Investors now see miners as providers of scalable compute, not just digital money.

Blockware is uniquely placed at the intersection of Bitcoin and AI. This dual strategy has the potential to prove transformative in the years ahead and to provide Blockware’s customers with additional flexibility - eg if the bitcoin price were to fall, the managed servers could be re-used for AI especially if the growth in AI is sustained.

For investors, the turnkey model and HPC opportunities make Blockware appealing across several profiles:

Their model has the capacity to bridge the gap between retail accessibility and institutional-grade infrastructure.

Bitcoin mining is often misunderstood as a niche or peripheral activity. In truth, it is the foundation of the entire Bitcoin network. Without miners, Bitcoin would not exist. 

Blockware’s journey mirrors the industry’s transformation, from scrappy start-ups to institutional operators to integrated compute providers. It’s a turnkey model that allows investors to participate directly in mining, while its HPC strategy offers flexibility and options, where Blockware Bitcoin miners can also become pillars of the global AI economy.

For those who believe in Bitcoin’s resilience and in the rising importance of computational infrastructure, Blockware offers interesting opportunities with future-proof paths to participate in both.

That’s all for today’s edition. We hope you got value from it—reply and let us know if you did.

Until next week,

— Brandon & Blake of Invested Inc

This deep dive was produced with support from Blockware Solutions, who reviewed factual elements but had no editorial control. The content is educational in nature and does not constitute financial, tax, or legal advice.

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