Blockstream, the global leader in Bitcoin infrastructure technology, is partnering with Luxembourg-based digital asset marketplace STOKR for the launch of an EU-compliant hashrate-backed security token issued on the Liquid Network: the Blockstream Mining Note 2 (BMN2).
BMN2 builds on the successful track record of its predecessor, BMN1, by offering qualified non-US investors a flexible and secure vehicle for gaining exposure to Bitcoin mining without the complexities and risks associated with managing mining operations, such as challenges in procurement and maintenance, long lead times, and volatile ASIC prices.
By removing these barriers of entry to mining, investors can participate more easily in Bitcoin’s proof of work, contributing to its overall security and censorship resistance.
Building on the Success of BMN1
The first iteration of the Blockstream Mining Note, BMN1, set a high benchmark for tokenized mining investments, achieving cash-on-cash returns of up to 108% over its three-year term. BMN1 also generated a gross 35% return of an additional 325 BTC over the equivalent amount of bitcoin invested, outperforming purchasing bitcoin on the spot market.
The BMN1 will deliver a total payout of more than 1,200 BTC to investors on Liquid, a Bitcoin layer-2 and sidechain purpose-built for asset issuance. BMN1 investors will have the opportunity to roll over from BMN1 to BMN2 and be rewarded with a 3% bonus in additional BMN2 securities.
BMN2: Lock in Historically Low Hashprices
Each BMN2 entitles holders to the bitcoin produced by 1 PH/s (petahash per second) of hashrate at Blockstream’s North American mining operations, providing a consistent stream of bitcoin rewards directly linked to mining performance. Hashprice in the context of Bitcoin refers to the profitability of Bitcoin mining. It measures the revenue that Bitcoin miners can earn per unit of hashing power, typically expressed as dollars per petahash per second per day ($/PH/s/day). BMN2 offers investors the opportunity to lock in a hashprice of $61.64 per PH/s for the 48-month term. With the Bitcoin mining market currently experiencing historically low hashprice levels, BMN2 allows investors to strategically enter the market at an opportune time.
Like its predecessor, BMN2 will be issued on STOKR, a Luxembourg-based Virtual Assets Service Provider. The primary offering will go live on July 18, 2024, with a 48-month term at US$ 90,000 per BMN2. The offering is open to non-US qualified investors with a minimum investment of $115,000 or $10,000 for professional investors, or the equivalent in BMN1, Bitcoin (BTC), Liquid Bitcoin (LBTC), Tether (USDT), USD or EUR. BMN2 mining operations are estimated to begin by September 2024.
As a security token issued on Liquid, BMN2’s design enables it to be traded peer-to-peer and on secondary markets among other eligible investors, offering greater flexibility and liquidity than traditional mining investments. BMN1 was available for trading on SideSwap, Bitfinex Securities and Merj Exchange. The estimated trading volume of BMN1 is €18.23M for the three year period.
Arnab Naskar, co-CEO and co-founder of STOKR, said, “We are proud to continue our partnership with Blockstream in launching BMN2. This new offering builds on the success of BMN1, providing investors with a reliable and innovative way to participate in the Bitcoin mining ecosystem. BMN2 not only represents a significant investment opportunity but also contributes to the overall security and decentralization of the Bitcoin network.”
Blockstream’s World-Class Expertise in Bitcoin Mining
Leveraging Blockstream’s enterprise-grade North American mining facilities, BMN2 investors will benefit from some of the world’s most reliable mining operations, trusted by many high-profile clients, including Fidelity and Foundry. The BMN2 will also utilize more alternative power sources, with 72% coming from wind power, making it greener than its predecessor.
Blockstream’s leadership in Bitcoin mining is well-established. It traces its roots back to CEO and co-founder Dr. Adam Back’s invention of the HashCash algorithm behind the proof-of-work protocol, a fundamental component of Bitcoin’s security architecture. Dr. Back’s pioneering work laid the groundwork for Bitcoin, and his ongoing contributions with the BMN and the BASIC note, another Blockstream mining offering, continue to shape the future of the entire real-world asset (RWA) industry.
“The BMN2 once again represents a groundbreaking opportunity for investors to engage in North American Bitcoin mining without the challenges associated with running their own mining facilities,” said Dr. Adam Back, CEO of Blockstream. “By leveraging our enterprise-level mining infrastructure and the expertise of our team, BMN2 offers a secure, transparent, and profitable investment vehicle to alternative mining investments such as mining stocks or hosting services.”
For further information or to register for the BMN2 offering, please visit stokr.io/blockstream-mining2.
About Blockstream
Blockstream is the global leader in Bitcoin and blockchain infrastructure. Blockstream is the technical provider of the Liquid Network, which enables trustless Bitcoin swap settlements and secure, dependable smart-contracts while empowering financial institutions to tokenize assets. Blockstream Mining provides colocation services to miners, across multiple enterprise-class mining facilities. Blockstream’s Core Lightning implementation of the open Lightning Network protocol is the go-to code for enterprise Lightning Network deployments on Bitcoin. Blockstream Jade is an easy-to-use, open-source hardware wallet that offers advanced security for Bitcoin and Liquid assets. Blockstream Green is the world’s most advanced consumer Bitcoin wallet. Blockstream was founded in 2014, with offices and team members distributed around the world.
About STOKR
STOKR is at the forefront of transforming financial assets for the digital era. As a leading digital investment platform, STOKR helps asset managers, fund managers, and issuers to tokenize and manage a diverse range of financial assets. STOKR’s platform simplifies the entry into the world of digital securities with a comprehensive suite of services that includes dedicated investment structures, state-of-the-art technology infrastructure, and full-scale support in payments and compliance.
With STOKR, clients can effortlessly issue digital securities and foster strong investor relationships, benefiting from enhanced liquidity thanks to the integration with secondary markets. STOKR’s approach removes the technical complexities typically associated with digital securities, offering a seamless investment experience. Leveraging over six years of innovation and expertise in the digital securities market, STOKR provides a sophisticated and secure environment for capital raising.
Registered as a Virtual Assets Service Provider (VASP) with the CSSF in Luxembourg, STOKR is committed to the highest standards of regulatory compliance, ensuring a reliable and trustworthy platform for all stakeholders.