John McAfee jumps on the bitcoin bandwagon

Bloomberg

Guess who’s jumping on the bitcoin bandwagon? John McAfee, the pioneering and controversial anti-virus software developer, who took over as the chief executive officer of MGT Capital Investments Inc. last year and turned the video-game company into a cybersecurity firm. He expects the money-losing company to be profitable as it ramps
up its bitcoin mining business, with the goal of becoming the biggest in the world. “We will definitely be profitable before the end of the year,” McAfee said in a phone interview. “From bitcoin mining, we
will get the experience and expertise to apply the blockchain to our security products.”
MGT Capital announced plans last June for the first phase of its bitcoin operation, which was the company’s only revenue driver in the first quarter. It’s stationed in the mountains of Washington state and employs two people, whose primary job is to maintain the air conditioning system for the computers that are doing the mining, McAfee said. MGT Capital has a dozen employees.
The bitcoin venture generated $312,000 in sales for the three months ended March 31, 2017, according to a government filing. The company had a net loss of $5.89 million. MGT Capital said that it received financing to buy 1,000 mining computers from Chinese firm Bitmain Technologies, bringing the total to around 1,300. It expects to start generating 225 bitcoins per month, up from about 100, which was the most recently disclosed number. The cryptocurrency is currently worth about $2,700 per coin.
Skeptics have warned that there’s a bubble in the making. Bitcoin
and other digital currencies like ethereum have surged as more companies embrace the underlying technology and some investors seek financial refuge from political uncertainty across the globe. MGT Capital primarily mines bitcoin, but also has small-scale operations for ethereum and monero, McAfee said.
“No matter how much government and regulators may scream and complain, there will be a world standard alternative currency,” McAfee said. “Bitcoin appears to
be the one… It cannot possibly be
a bubble.”
Bitcoin transactions are overseen by a network of so-called miners whose computers perform calculations to validate each transfer, preventing double-spending. Miners earn a reward of newly issued bitcoin. The pace of creation is limited, and no more than 21 million bitcoins will ever be issued.
MGT Capital grabbed investors’ attention last year after naming McAfee CEO.