Engineering the Bitcoin Gold Rush: A Chat With Yifo Guo

A month after it reached a new all-time high, the rollercoaster ride that is bitcoin continues to thrill and confound after a series of events helped propel the virtual currency to stratospheric new heights, more than doubling its market value with the digital currency now trading at over $70.

Over in Europe, the threat of financial Armageddon gave citizens new reason to consider the viability of cyberpunk alt-money. As Cypriot officials put 100 euro limits on withdrawals, the tiny Mediterranean island will soon welcome its first bitcoin ATM.

Here in the US, Silicon Valley venture rich-guys continued to bet on the promise of this burgeoning internet-of-finance disruption, while the department of the U.S. Treasure that combats money laundering, FinCEN, for the first time, issued guidance on decentralized virtual currencies, tacitly giving bitcoin the legal thumbs up but also paving the way for impending regulations.

And quietly in the background, a company called Avalon shipped the first ASIC-based bitcoin miners, custom-built rigs with specially-designed chips for efficiently printing the market’s hottest commodity, ushering in what can be considered the internet’s first gold rush. (Someone recently paid $20,000 for a $1,500 miner from batch two on eBay. At the time of this writing, another auction has a batch two Avalon miner going for over $19,000.)

After opening up its third batch of 600 miners for sale yesterday, customers from around the world from countries like Argentina, the UK, and even Egypt (although the majority of orders came from the big three of the US, Russia, and China) made sure Avalon’s units sold out in fifteen minutes. We had the chance to sit down with Avalon’s founder, Yifu Guo to talk bitcoin, mining, and the future.

MOTHERBOARD: So how and when did you get involved with bitcoin?

It was early 2011 when some article about bitcoin popped up in my RSS feed. I don’t remember the exact article but I remember thinking at the time that this was the stupidest thing ever. It would never work. But what kept my attention was that it was open source and after a few days of thought and further research, I concluded that this was legit.

What did you do from there?

At first I just got involved with the community. I didn’t do anything presentable per se, but I participated in some feature discussions, became a regular in the forums. One of my first projects was this website that showed verified physical locations that accepted bitcoins called Bitcoin Navigator. It's still up--sometimes.

What was the community like back then?

The community was very… immature, I’d say. It was mostly tons of speculation. There was nothing really meaningful you could do back then. Mining was the central focus because of the profit incentive. And so a lot of people were just mining these things and so was I. The two long term goals then were to build services around bitcoin while also getting people to accept the concept.

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