What it is
First of all, you need to understand what a mining farm looks like. This is a set of equipment packed in a case or located on an open stand. There are many rig options in 2022, varying in size, devices used, and more. The smallest models can be assembled at home and you can mine cryptocurrency right in your apartment. Large ones are installed in special rooms, with well-thought-out ventilation, cooling and a separate connection to the electrical network.
Why mine cryptocurrency?
There is an opinion in the world that the main purpose of miners is to extract cryptocurrency and thereby enrich themselves.
In fact, miners are the basis of the blockchain, without which the existence of cryptocurrencies is impossible, at least for now.
Blockchain is a chain of blocks. They store information about all transactions between users throughout history. The transfer of crypto coins cannot occur until it enters the block. In addition, several blockchain participants must confirm that the transaction is not fraudulent. Only after this, the cryptocurrency goes to the specified account.
This is where miners come in. They mine and confirm blocks.
They do this with the help of computing power, so-called cryptocurrency farms, which solve complex mathematical problems.
If the miner has fulfilled his “purpose”, he receives a reward for his efforts in the form of a certain amount of crypto coins.
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How it works
Many people are interested in how a mining farm generates income. In principle, this is the same computer, but only much more powerful. Their appearance is caused by the increasing complexity of cryptocurrency mining. For example, it has long been impossible to earn bitcoins on a personal PC, and not every farm is capable of this. You can receive ether on your home computer, but it will cost mere pennies.
And if you assemble a mining farm from several video cards, then any coin except BTC can be mined. Moreover, depending on the number of installed adapters, the total power increases, and therefore income.
To understand how mining farms work, you need to look at the cryptocurrency mining process itself. Mining algorithm - money is awarded to miners for solved blocks. To open each of them, you need to solve several small problems called balls. This is done by individual users on their own equipment. As soon as the ball collects a sufficient number, a reveal occurs and everyone participating in it receives some money depending on what was found.
Now, how does a mining farm work? These are several video adapters combined together and connected to the motherboard, with a power supply, processor, RAM, and SSD. All GPUs jointly solve 1 task, which significantly speeds up the process. Therefore, you can manage to send more shares before closing, which will give increased income.
Conclusion
Despite another decline in the cryptocurrency exchange rate, the performance of the equipment allows us to maintain high profitability indicators. This is especially true in regions with low cost per kilowatt hour. Attempts by the Chinese government to ban payments in cryptocoins and the legal uncertainty of bitcoins as a means of payment do not stop the development of the industry.
Even during a period of low prices for digital coins, the demand for equipment does not fall and large corporations continue to expand capacity and update their equipment fleet. The only problem is that excessive concentration of production and the use of specialized expensive equipment increases the entry barrier and reduces the profits of single miners.
Advantages
A simple computer consists of several required devices:
- Motherboard
- CPU
- RAM
- Storage
- power unit
- Video card
A farm for mining ETH and altcoins, in turn, also includes the first 5 points, but video cards can be much more than 1. This leads to the first plus - saving on equipment.
The second advantage is the speed of payback. By purchasing or collecting mining rigs, you open blocks much faster and get more rewards. This is due to the peculiarities of cryptocurrency mining, because everything in it depends on how many shares you managed to open. The more you collect, the higher the payment for the work done.
Kinds
You've probably seen a GPU-based mining rig in pictures on the Internet or in programs. But there are other types, differing in the equipment used:
- FPGA. In this case, special FPGA modules are used. In terms of power, they are on par with conventional video cards, but are superior in terms of energy efficiency. They also require fewer resources to cool, which reduces costs. Now they are less common, as they were replaced by the next species.
- ASIC. If you were wondering how a Bitcoin mining farm works, here it is. Bitcoin mining is primarily performed by ASIC processors. The rigs assembled from them have enormous power that can cope with the high complexity of the BTC block. They have excellent profitability, but at the same time the cost is also at an appropriate level and is calculated in thousands of dollars.
Ten Amazing Bitcoin Mining Farms
07/07/2016 kaplan
#Australia#Bitcoin#Iceland#China#Mining#Switzerland
Since the birth of Bitcoin, cryptocurrency mining has become not just a multi-billion dollar business, but also a real art.
A creative approach to business is what has always distinguished Bitcoiners around the world, and in a highly competitive market, they often have to make unusual decisions.
The editors of Forklog decided to talk about several exciting projects from the Bitcoin mining industry.
Dave Carlson's Secret Farm
Photo - Bloomberg Businessweek
Dave Carlson's farm is located in Washington state on the Pacific coast of the United States. According to his own statement, it is the largest in all of North America. A software engineer and entrepreneur with ten years of experience, he decided to get into mining after facing financial problems at his previous job at an advertising company.
The company he founded in the basement of his own home, MegaBigPower, grew into a multimillion-dollar business in just a year. Today the farm is located in a separate building, in a former industrial warehouse. However, its exact location is not disclosed. Among the factors that contributed to the success of the business, Carlson names not only a desperate desire to get out of a financial hole, but also the fact that Washington State boasts some of the lowest electricity prices in the United States.
Having expanded the enterprise, Carlson estimates his monthly operating expenses, including wages for 15 people, at more than $1 million. The final figure of 1.3 petahesh, according to him, pays for itself in full. Moreover, having managed to attract additional investments, the entrepreneur began producing mining equipment based on Bitfury chips for further sale to other Bitcoin enthusiasts. Things seem to be going well for Carlson.
Genesis Mining Farm in Iceland
Genesis Mining started out with several farms in Bosnia and China, but today its main operations are in Iceland. This northern country, in addition to its national football team that has delighted the whole world, can also offer almost ideal conditions for mining: cheap electricity, good Internet connection and a cold climate. The latter turns out to be an extremely important condition, since it allows you to significantly save on cooling, thereby reducing the cost of mined bitcoins.
However, as Genesis Mining CEO Marco Streng recently admitted, the company uses a very significant amount of electricity and is perhaps the largest consumer in Iceland.
In addition to Bitcoin mining, the company recently launched Ethereum mining, and the farm itself, codenamed Enigma, is said to be the largest in the world.
Allied Control Farm in Hong Kong
Despite the region's hot and humid climate, technology company Allied Control has built Hong Kong's largest farm, relying on what it calls two-stage liquid immersion cooling technology.
The farm was built specifically for Chinese investors and is distinguished by its amazing quiet operation. Initially, ASIC chips were used in the mining process, but in January 2015, Allied Control came under the control of BitFury. The latter produces its own chips, and although the parties did not publicly disclose the details of the deal, it can be assumed that replacement of chips was also envisaged.
Two-stage liquid immersion cooling
BitFury data center in Georgia
In December 2015, BitFury opened a new 40 MW mining data center in Tbilisi. The data center, located on the territory of the Free Economic Zone of the capital of Georgia, also uses two-stage cooling technology by immersion in liquid. Bitfury is committed to being as environmentally friendly as possible and is powered by local hydroelectric power.
The company chose Georgia due to its optimal climate, minimal regulatory requirements, low cost of electricity and competitive working conditions. In the new data center, Bitcoin transactions are processed using computing equipment based on the latest 28 nm chips and the widely advertised 16 nm chips.
In addition, the company has another data center in Georgia, as well as mining facilities in Iceland.
Linthal, Switzerland
photo - srf.ch
Founded by Bitcoin pioneer Guido Rudolphi of Alpereum, the farm opened in April this year. It is located in the small village of Linthal in eastern Switzerland. In the past, Rudolphi had already run a mining farm in Zurich, but found the operating costs too high. As a result, after almost two years of searching, Rudolfi chose Lintal, where, according to him, the cheapest electricity in the country.
The new farm, located in a former factory, is considered the largest in Switzerland. Although the issue of cooling processors is still relevant, Rudolfi insists that the possible financial benefits are not a determining factor for him. The world, he believes, needs Bitcoin more for political reasons. The farm owner compares cryptocurrency to the Internet of the 1990s, when many also viewed this phenomenon with a great deal of skepticism.
On April 16, an open day and Bitcoin meetup took place at the mining farm in Lintal. Following the event, the project team made a short video:
China
An analysis of the leading mining pools shows that more than half of the total hash power on the Bitcoin network belongs to three Chinese pools. Leaving aside any possible community concerns about this state of affairs, China has a number of advantages when it comes to mining for a variety of reasons.
First of all, this is a relatively inexpensive labor force and the willingness of farm employees to live in unpretentious living conditions, even in utility rooms. China is also known for its ability to produce almost any product, and mining equipment is no exception. In addition, Bitcoin mining often turns out to be economically profitable here due to the lower cost of electricity than in other countries.
At the same time, due to the political climate in the country, many pool operators often try not to advertise their activities. This leaves its mark on the appearance of data centers.
A utility room for workers to rest at a mining farm in Guizhou province is equipped with a monitor showing what is happening in the data center Photo - NYTimes
Last year, HaoBTC chief marketing officer Eric Mu spent about three months on a company-owned farm in the mountainous region of western Sichuan province. He noted on the bitcointalk forum that thanks to cheap energy from local hydroelectric power and inexpensive cooling systems, the data center shows high returns with minimal carbon emissions. At that time, the farm hashrate was 4.7 PH, and the company planned to increase it to 12PH within three to four months.
Below are a few of the photos he posted, the rest of the images can be seen in the original post.
In fact, there are many different mining farms in China, and they are all unique in their own way. Another example of this is the existence of a large farm in a secret location in Liaoning province, which accounts for about 3% of the total hashrate of the Bitcoin network.
Bitcoin Group - China / Australia
Photo – Bitcoin Group
Bitcoin Group, in addition to several unsuccessful attempts to enter the Australian Stock Exchange, is known as one of the largest Bitcoin operators in the world. The company owns five data centers in China, combining 6,000 computers.
In addition, Bitcoin Group has operational facilities in Iceland and Australia. The company attaches great importance to environmental issues and therefore uses renewable energy sources wherever possible. Thus, 82% of the company’s total hashing power in China is produced from electricity obtained from hydroelectric power stations, and the data center in Iceland, where there are a large number of geysers, uses geothermal energy.
In total, Bitcoin Group accounts for about 1.19% of the total hash power of the Bitcoin network (6.2 PH).
It is noteworthy that at the company’s head office in Melbourne there is perhaps a one-of-a-kind Bitcoin Mining Museum, where various devices and devices used in cryptocurrency mining are collected.
This review cannot claim to be comprehensive, since the number of unique and amazing farms in their own way will be too large. Soon ForkLog will introduce you to other interesting objects.
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Buy or assemble yourself
We hope that we were able to clearly explain how a mining farm works. Now let's look at the next question - buy ready-made or assemble it yourself at home. An entire separate review can be devoted to the assembly for beginners, since there are many important points there. If you can assemble a computer yourself from individual components, then you are already one step closer to a rig. Only here you still need to additionally think through good cooling, calculate power consumption, and create structures to accommodate numerous equipment.
It will be easier to buy an installed unit, but you need to contact only professionals. An incorrectly assembled rig will not only fail to operate at 100% performance, but can also quickly break down or even cause a fire. If you are wondering how to find a mining farm, then contact specialized stores, where they will give a guarantee not only for the equipment, but also for the work. In this case, get a good device for home cryptocurrency mining.
How much does a rig bring per month?
The Bitcoin price is constantly jumping, and there are even jumps of $10,000 per minute, and this directly affects other altcoins. The income formula is simple - how much does the farm bring minus energy costs. As long as you get a value with a “+”, you can continue, but otherwise, you should think about replacing the equipment to improve cryptocurrency mining, but many programs work without interruption.
Let's look at what an example farm of 6 Nvidia RTX 3080 GPUs would look like:
According to the profitability calculator, it will bring in an average of $37, minus the cost of electricity. The cost of 1 GPU is 180,000 rubles, that is, the total is 1,080,000. We add the price of other components, approximately 30,000 rubles, which gives 1,110,000. It turns out that it will pay for itself in 410 days. But we must not forget about how pricing works, and depending on the market, the situation can change in any direction.
