Do Bitcoin Miners Need Product Managers?

by drjim on December 7, 2015

Bitcoin miners have marketing needs also

Bitcoin miners have marketing needs also
Image Credit: Jason Benjamin

Have you hear about bitcoins? It’s the craziest thing – people are in the process writing their own product development definition and inventing a brand new currency! This currency has no ties to any government or country. The whole thing “lives” in the minds of the computers who together make up the Internet. The math behind it is a tad complex, but it seems to be growing in popularity and, more importantly, you can actually buy things using bicoins. Microsoft recently announced that they would accept bitcoin in payment for their products. What does all of this mean for product managers?

To Play In The World Of Bitcoins, You’ve Got To Become A Miner

So here’s how bitcoins work. In the beginning, there were no bitcoins. Then people starting running a computer program (“mining”). This program solved a math problem. When they solved the problem, they would be rewarded for their “mining” activities with bitcoins from a central location. The math problem then became harder to solve and everyone got back to work.

As bitcoins started to show up more and more, people started to accept them in exchange for real-world goods. Once other people saw that this was happening, they become motivated to do more mining. In order to solve the math problem quicker, bigger, faster computers were needed. Investments in data center resources were made and what had been something that people where doing at home on spare computers quickly become an industrial operation almost overnight.

There was one wrinkle in this whole “print your own money” scheme. As with “real world” currencies like the dollar, euro, yen, ruble, etc. the exchange rate for bitcoins is not a fixed thing. That means on any given day, the value of the bitcoins that you own can go either up or down. If your business is involved in mining, then any big downturn in the value of bitcoins could have a very large impact on the profitability of your business.

How To Stay In Business In The World Of Bitcoins

As product managers, if we want to have something to put on our product manager resume then it’s our responsibility to make sure that our company is a success no matter what product or service we are selling. In the case of a bitcoin miner, we’re selling a mining service that creates value simply by creating more bitcoins. One of the things that we need to remain aware of is the value of bitcoins because as the value goes down, the funds that we have to work with will be limited.

The way that bitcoins are created is by having computers solve a math problem. When the math problem is solved, our company will received more bitcoins for our effort. The challenge is that computers are becoming faster and faster and that is allowing more competitors to enter into this market. As product managers we need to take steps to make sure that our company is able to boost our capacity and increate our computing resources.

Right now the world of bitcoins is very much like an unsettled frontier. The rules have not yet been written; however, there is a great deal of money to be earned. Product managers have an important role to play in keeping the company that they work for afloat by watching what’s going on with bitcoin exchange rates and making sure that bitcoin mining capacity is being maximized.

What All Of This Means For You

Talk about a challenge! Product managers who are looking for a real challenge are the ones who will end up working for a company that is in the business of mining bitcoins. There is no other firm or product manager job description that we can look at as a reference when we find ourselves in this situation. This is a real challenge!

The company operates a series of computers that spend their time solving a math problem that, once solved, will provide our company with the funds that we need to keep going. As product managers we need to remain aware of what the current exchange rate for bitcoins is. Additionally, we need to always be looking for ways that we can expand the computing capacity that our company uses to create bitcoins.

This is a crowded market and it may become more crowded over time as more players enter the market. With a strong guiding hand a product manager can help his or her company to continue to move forward in an ever changing market. If you are looking for a real adventure, this might be the job that you want!

– Dr. Jim Anderson
Blue Elephant Consulting –
Your Source For Real World Product Management Skills™

Question For You: Do you think that it would a good idea to partner with another firm if you worked for a bitcoin miner?

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What We’ll Be Talking About Next Time

In the world of social media, few firms have become quite as large as quickly as Pinterest has – clearly they have a very good product development definition. This social networking site allows visitors to “pin” images that they find on the Internet on their page and then share these pins with others. As a product manager, if we found ourselves in charge of a product like Pinterest, I’m pretty sure that we’d be feeling quite proud of ourselves and what our product manager resume looked like. However, even in the world of Pinterest there is trouble brewing. It turns out that the majority of their users are women – men just don’t seem to pin. What can be done to fix this problem?

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{ 3 comments… read them below or add one }

Ken Ashe December 8, 2015 at 12:17 pm

Interesting article. I read somewhere that there are only a limited amount of bitcoins, this has what made their value rise so high.

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drjim December 10, 2015 at 8:56 am

Ken: You are correct. It is my understanding that one day they will have all be “mined” and there will be no new ones introduced, we’ll all just have to make do with the bitcoins that are already in circulation.

Reply

Ken Ashe December 15, 2015 at 9:49 pm

Yeah. That’s what makes them so valuable. I wonder what the next online currency will be?

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