frx system
Social MiningSoMi
Social Mining (“SoMi”) is the FRX system used to develop, re-sell and manage crypto-linked income producing property in the US – specifically mining datacenters.
Aligning government policy objectives with private sector profit goals
Social Mining (“SoMi”) is the FRX system used to develop, re-sell and manage crypto-linked income producing property in the US – specifically mining data-centers. The datacenter use-case strategy is rapid-deployment integration into existing municipal structures acquired in privatizations or from de-funded municipal contracts. The Structures are decommissioned rural jails principally in the American West. The privatized rural jails were originally constructed in distressed rural communities as economic development initiatives. The high-security construction and existing cell floor plan configuration is adapted by SoMi to originate its “Digital Landlord” investment product for crypto investors to buy into Datacenter Condo income property. The income product achieves Bitcoin (“BTC”) exposure through a commercial real estate asset class wrapper.
Inflows to Grayscale OTC traded products suggests market demand for wrapped financial products linked to crypto assets.. SoMi believes that most crypto investment is long-term, which is confirmed by a research note from Cathie Woods’ Ark Invest (Big Ideas 2021) that said “Bitcoin market participants never have been more long term focused” where “60% of BTC supply had not moved in more than a year”. This represents hundreds of billions of passive assets that is increasing and will continue seek yield enhancement opportunities through product innovation.
FRX Zoning Criteria
SoMi invests in real property suitable for crypto mining located exclusively in IRS 45D(e) Low- income Communities or TCJA Opportunity Zones that are legally entitled to federal tax and financing benefits. The “zoning” of the properties is integral to the strategy to be a domestic low-cost operator of crypto-mining infrastructure and crypto mining. Congress has fully appropriated the continued development of rural electric power, which originates from the Rural Electrification Act of 1936. The US Department of Agriculture maintains a $40B electric loan portfolio. Congress has also recently fully funded the USDA and the FCC specifically for rural digital infrastructure. SoMi is positioned with these financial and political tailwinds.
Over time, off-grid solar available in the rural western states will contribute to lower blended cost of power for SoMi.
Also because of “zoning” rights SoMi is considering offering the first of its kind digital Opportunity Zone Fund product. The OZF would permit owners of appreciated digital assets, or any appreciated asset, to roll over the sale proceeds 100% tax deferred.An OZ Fund would be compliant because of the use of proceeds on real property improvements of the jails. Internal evaluation is ongoing.
Conclusion
The SoMi System of the Front Range Exchange aligns government policy objectives with private sector profit goals. The capital requirements, power demands, and infrastructure needs of an institutional-scale crypto mining business is enabled by the capital arbitrage strategy. FRX is thereby a low-cost provider without locating in a foreign jurisdiction. Rural communities are benefitted, and mass incarceration is positively effected. The impending stimulus-funded infrastructure spend of the federal government – including digital infrastructure – creates substantial additional tailwinds for FRX in building out its green bitcoin data-centers.
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