Three months ago Coinlab, an up-and-coming Bitcoin incubator, announced its first spin-off company, Alydian. Yesterday the company filed for Chapter 11 bankruptcy.
The company, which aimed to offer outsourced Bitcoin mining by allowing users to buy mining rigs and host them at their facility, closed with less than $50,000 in assets and over $3 million in debt. Wrote the former CEO, Hans Olson, “Alydian has developed an enterprise-scale Bitcoin mining system over the past year and we are excited to announce our capabilities today. The system, based on our first generation 65 nm custom ASIC technology, will enable non-technical customers to participate in terahash and petahash-scale Bitcoin mining without worry or technical expertise. Alydian will begin at-scale operation and hosting in late August.”
In the interim period Olson seems to have been replaced by CEO Peter Vessenes who led the bankruptcy in Seattle.
“Coinlab is a bit of a black box, but it looks like they were attempting to pivot from exchange-enabler to a bitcoin incubator. Incubators are definitely viable in the Bitcoin space, but I’d argue the risk is almost greater here than other areas of disruptive tech,” said Adam Levine, Editor-in-Chief at LetsTalkBitcoin.com. “ASIC mining has gone from being a joke of an industry to a highly competitive meatgrinder. Business models are being smashed every week, it’s not surprising they decided to pull the plug.”
As of this writing the company page is still live and Coinlab and Alydian have not replied to requests for interviews.