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Ministry of Innovation / Business of Technology

Chip veterans form new startup, will sell high-end Bitcoin miner for $14,000

CoinTerra says that its TerraMiner IV will reach two terahashes per second.

On Tuesday, a new Bitcoin startup called CoinTerra announced that it raised $1.5 million in venture capital. This likely puts the company in a position to dominate the Bitcoin hardware market—assuming it can come through on its promises.

Earlier this month, CoinTerra revealed the TerraMiner IV, a two terahash per second ASIC Bitcoin miner that will sell for $13,999 and is set to ship in December 2013. (An ASIC is a specialized computer designed to one specific task, in this case the goal is mining bitcoins.) By contrast, the one that Ars tested earlier this year was a five gigahash per second device made by Butterfly Labs. That company also makes a 500 gigahash per second ASIC miner that costs over $22,000. So if CoinTerra's TerraMiner IV ships as described, it will be one of the highest-end and relatively lowest cost miners available.

When Butterfly Labs (BFL) began, it was funded by a nearly entirely anonymous set of 10 owners. They include a Kansas City photographer who takes photographs of the Kansas City Royals baseball team for a living, a major French bank, and an Iranian living in France who says he’s a “senior IT consultant” with Société Générale. (Adding to the weirdness, the two individuals there have never met in person.) But BFL has watched its competition grow as it has struggled to deliver on its promises. Cointerra is just the latest potential rival.

In its press release, CoinTerra made a point of ensuring commitments if it can't deliver.

"If CoinTerra fails to deliver chips or rigs within 30 days of its promised December delivery window, the company will credit your account 20 percent of the hash power of your order," the company wrote. "For any undelivered orders, if the company changes the price of TerraMiner systems or GoldStrike1 ASICs before delivery, CoinTerra will re-price all orders and offer either a cash refund or a larger and more valuable hash power credit."


Iyengar, though, was still coy about who his new investors are.

“We have investors who are well-known in the Bitcoin community and also investors who are well-known in the tech world,” he told Ars.

Iyengar went on to say that the Bitcoin world is ripe for a mature manufacturer, noting that his company stood in contrast to others that have been more “hush-hush about their team profiles.”

“I realized that never before has there been an opportunity like this for ASIC architects and designers to participate in something so exciting and at the same time so disruptive,” he added. “It was not about just selling products to consumers any more; this was an opportunity to make a tremendous impact on the financial framework and its ecosystem while still utilizing my years of high-performance, low-power ASIC architecture experience.”

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