Bitcoin Mining Manufacturer Canaan Acquires Proof of Existence

The first document timestamping service for the Bitcoin blockchain, Proof of Existence, has been acquired by Bitcoin ASIC mining hardware manufacturer Canaan. The company has also retained the founder of Proof of Existence, Manuel Aráoz, as an advisor on future product development.

Also read: Veriphant Helps Enable Legal Proofs in the Bitcoin Blockchain

The Acquisition by Canaan

Founded in 2013 and headquartered in Beijing, Canaan Creative Co. Ltd (Canaan) produces Bitcoin mining rigs, designs ASIC microprocessors and operates data centers.

On Sunday, May 21, the company’s Hong Kong-based subsidiary, Canaan.io, announced that it had acquired Proof of Existence from founder Manuel Aráoz. “The blockchain space offers us opportunities on the hardware side and on the services side,” said Xiangfu Liu, Canaan co-founder, adding that:

We make the hardware that secures the blockchain; and now with the acquisition of Proof of Existence, we will also build services on top of the tamper proof features of the blockchain.

Early this month, the company also announced that it had raised RMB300 million (approximately US$43 million) in a series A funding round. Its investors include Chinese hotel operator Jin Jiang International Group Co. Ltd, Chinese investment firms Baopu Asset Management Co. Ltd., and Tunlan Investment.

The funding will support Canaan’s “upcoming 7nm designs and to enter the AI [Artificial Intelligence] market with its first Knowledge Processing Unit (KPU),” the company revealed on Sunday. Its products can be applied in AI fields including smart home appliance, autonomous driving, voice interaction and image recognition.

Avalon Mining Family

Canaan is the company behind the Avalon mining family of hardware which produces ASIC mining chips and rigs. The line of hardware was launched in late 2012 and was the first to successfully pre-sell commercially available ASICs. Avalon mining rigs were sold and delivered before any other brands of ASIC bitcoin miners, even pre-dating the infamous Butterfly Labs brand, making it the oldest brand of Bitcoin mining equipment still in production today.

When Avalon first debuted their then-powerful, 65 gigahash mining rigs on Ebay for $1,500, the response was so overwhelming that the last unit sold for over $20,000. Today, their 7.3 TH/s Avalonminer 741 sells for $715, as shown on Canaan’s website.

Proof of Existence

Proof of Existence was another historic debut for Bitcoin. Launched on May 21, 2013, it was the first blockchain-based service to allow users “to publicly prove that you have certain information without revealing the data or yourself, with a decentralized certification based on the bitcoin network,” its website describes. According to Sunday’s announcement:

It [Proof of Existence] has processed thousands of documents supplying customers with immutable proof of existence for their assets.

The service offers document proofs that are stored on Bitcoin’s blockchain, without storing the document itself. The first of many similar services and protocols to do the task, Aráoz’s website uses a special bitcoin transaction that contains the hash in Bitcoin’s OP_RETURN script, embedding it into the bitcoin blockchain. It also lets users come back and verify their documents later.

Manuel Aráoz’s Other Projects

As part of the acquisition agreement, Canaan has retained Aráoz as an advisor on future product development and other blockchain related services. “Aráoz has agreed to continue on and advise the company on improvements to the product as well as other software services,” the company wrote. “The agreement ensures that there will be no interruptions in services and no changes in the API.” Commenting on the acquisition, Aráoz said:

I’m really happy to close this deal with Canaan.[…] I’m looking forward to enhancing the product, and exploring other blockchain services.

Aráoz, who lives in Buenos Aires, has been involved in many projects surrounding and supporting the Bitcoin ecosystem. Proof of Existence was his first, which led to him working for Bitpay in 2014, where he helped develop the popular Javascript Bitcoin library, Bitcore.

That project led to the creation of Multipaper, the first multi-signature address paper wallet, which uses Bitcore. Then in May 2015, he created Streamium, a video livestreaming application like Periscope or Meerkat. Streamium was the very first application to use Nakamoto payment channels for micropayments while streaming live P2P video. Today Aráoz is working on Decentraland, a blockchain-based virtual reality project.

What do you think of Canaan acquiring Proof of Existence? Let us know in the comments section below.

Images courtesy of Shutterstock, Bitcore, and Canaan

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