- Starcloud, a data centers-in-space startup, raised nearly $500 million at a $2 billion valuation for a concept critics call impossible.
- The company announced plans to mine Bitcoin in orbit, likely producing the most expensive BTC ever due to launch and maintenance costs.
- Its core idea has been debunked by the IEEE and a prominent YouTuber, while a single H100 GPU already overheats in space.
As the AI hype train rumbles on, Starcloud, a data centers-in-space company, has received nearly half a billion dollars in funding and a $2 billion valuation for an idea that already seems impossible to execute. Now, the company has decided to begin mining BTC in space.
Whether you like Bitcoin or hate it, this is crazy. One of the most important aspects of BTC mining has always been obtaining the cheapest energy for running miners.
Running ASICs in space instantly becomes more expensive than on Earth because you have to factor in launch costs, radiating heat, an inability to change energy sources, and orbital maintenance. Consequently, Starcloud is now mining the most expensive BTC in cryptocurrency history.
Even without BTC mining, Starcloud‘s entire business model appears to have been debunked by the IEEE and YouTuber Real Engineering. Achieving gigawatts of processing power in space would require tens of thousands of launches and a solar array four kilometers long.
Meanwhile, Starcloud has already sent one NVIDIA H100 GPU into space, but it cannot run at full power because the satellite overheats. Data centers on Earth need a steady stream of replacement parts, which would be far more expensive 500 kilometers away.
GPUs would also be bombarded by far more radiation in orbit than in a cooled building on Earth. This hasn’t stopped the CEO from pumping the concept, and in a recent interview with Y Combinator founders, hyper-wealthy investors failed to ask any difficult questions while seemingly ready to hand over more cash. If Starcloud accomplishes even a fraction of its goals, it will take well over a decade and cost far more than the half billion raised so far.
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