In February 2021, Jeremy Segal launched SOLminer – “SOL” being the Spanish word for “sun” – a Paducah-based cryptocurrency mining and hosting service.
“Long-term is our mission
to be solar-powered,” Segal, 35, recently told The Sun. “There’s not a lot of solar on the local grid.”
SOLminer is buying renewable energy credits as a green energy incentive, which the Florida native has talked about at crypto conferences and encouraged other miners to follow suit.
SOLminer differs somewhat from other regional crypto companies. It is smaller, mining with 7,000 computer graphics cards with a capacity of 3.75 megawatts between two Paducah sites. One site also accommodates an additional 22 megawatt capacity for ASIC hardware.
Ether — a currency second only to Bitcoin in market capitalization
and represents Ethereum,
a blockchain-based software platform that companies like Amazon and Microsoft have invested in for future product launches.
Aside from distant relatives who grew up in the area, Segal said Paducah’s environment had business and family appeal. In June last year, he moved to the area with his wife and 9-month-old son.
“We are members of the (National) Quilt Museum and recognize and know more people at the Farmer’s Market, coffee shops and restaurants,” he said.
“Paducah is also poised for growth. It has a lot of infrastructure, and it’s building more, but that growth hasn’t quite arrived yet.”
“We looked at Illinois, Washington and New York, but we heard stories two years ago about the crypto farm consensus changing. To hear (in Kentucky), ‘No, we’re not doing crypto here,’ seems like it would be a pretty big swing compared to other places.”
Doug Handley, Paducah Power System director of finance, power supply and pricing, said SOLminer operates below the same market-based price as similar industrial companies.
After graduating from Florida State University with a bachelor’s degree in accounting, Segal earned a master’s degree in information systems administration from the University of South Florida.
“I wanted to find out how businesses operate,” he said. After working at Ernst & Young, at age 25, he became CFO of Bay Dermatology, a 130-employee medical practice in the Tampa Bay area.
“I was very driven to be an entrepreneur, but I couldn’t be one without being a CFO first — that was a mental block,” he said. “Once I got there … after that I started my own business.”
Segal and a friend ran a drone accessory company for two years before selling the business and launching a Japanese sports car dealership in Clearwater, Florida. Under a US import rule, they faced fewer restrictions on importing vehicles made more than 25 years ago.
“Nissan Skyline GTR 1989 – we were the first to import it and the niche dealer created a media splash at the time,” he said.
“I’ve been paying myself minimum wage, which put a strain on my family, because I reinvested everything back into the business. Until recently, my (take-home) pay wasn’t much higher than my first job.”
They liquidated the dealership six years later. Segal set his sights on crypto, purchasing an industrial park west through Greater Paducah Economic Development.
“It’s not the best fit (yet, for expansion),” Segal said. He also remotely operates an additional site in Florida. “We run lean, cut costs as best we can and maximize equipment efficiency. We want to ensure that we are in the best possible position in a market downturn.”
Despite the current high energy prices, Segal said electricity futures point to upcoming rate falls: “Electricity prices are expected to settle in the coming months. SOLminer operates GPU mining, which is able to maintain profitability better than ASIC (Bitcoin) miners when electricity prices are high as they are now.”
In September, an ongoing software upgrade called Merge could render Ether mining obsolete, making the currency deflationary. Ideally, the scarcity will increase the investment value.
“Sure, it might affect things, but that talk has been going on for over six years,” he said, referring to often stalled upgrades that have become a running joke in the crypto community.
“There are a number of other (currencies) to mine, such as Monero and Ravencoin.” A popular website, WhatToMine.com, lists the current most profitable currencies that anyone can mine with hardware based profit calculators.
“I’ve run a business before, and we figure it out,” he said, explaining other use cases such as AI computing and 3D rendering.
Some argue that crypto has peaked, beginning with Biden-era regulation.
After the 2022 Superbowl featured A-list celebrities touting crypto products and services, pundits referenced the Dot-com bubble. In December 2021, the Staples Center in Los Angeles changed to the Crypto.com Arena, leading some to mark it as crypto’s death knell.
Segal remains optimistic.
“Cryptocurrency has always gone in cycles since the beginning. I don’t have an answer (for the future), but I think blockchain is here to stay,” he said.
“There have always been large fluctuations in the market and in people, organizations and governments who want to control blockchain technology. Usually, those who hold power try hard to hold on to that power as long as they can.
“Blockchain is harder to control and I think eventually we will own all our data. Is it going to happen in our lifetime?” He shrugged, “but I think that’s where the future is going.”
