Overview of the conditions of mining hotels and a plan for opening your own center

They started bringing mining equipment to our data center in 2010. Back then it was all a novelty. Our employees were also interested in this topic back then and mined on regular ATX and Big Tower. I looked at all this with skepticism. States will never give up the printing press and taxation. But demand creates supply. And over the past 10 years, cryptocurrencies have made significant progress.

Supply and demand are very funny in this market. Topics constantly popped up in the news about would-be miners of fire victims who mined on balconies, in apartments and God knows where else, not thinking that household outlets were not designed for this and the laws of physics and electrical engineering would bypass them.

Another group of viral news was about those who stole electricity and mined in secret from management on an industrial scale. This was done by employees of various companies with a large number of computers or access to electricity.

And the most interesting thing is that these are one-day companies that assembled equipment and disappeared or stole electricity and became involved in criminal cases.

Here we will talk about a number of facts that are worth thinking about for those who are mining cryptocurrency or are just planning to. So, let's go.

Everyone rushes to mine at the peak

Guys, you have to sell at the peak! And you have to mine when everything has fallen. We see these waves with our own eyes. As soon as Bitcoin explodes, the client runs to us and cannot be stopped. As soon as the crypto falls, clients run away and sell everything. And they cut their poor hair in a circle. At the peak, they buy video cards, which, as now, disappear from store shelves, causing gamers to suffer. Then, as everything fell, they sold it for next to nothing, although that’s when it’s a good time to buy video cards and ASICs.

You need to have strategic thinking. Mining is a long game, just like the stock market. This is for retirement or for 10-20 years. On average, it will most likely increase and save and increase your savings. But locally, if you run after the news waves, you will most likely lose, because when the news reached you, it had already been processed 10 times on the exchanges.

Risks

Mining hosting located in Moscow or any other city also carries risks for the owner of the equipment. The main risks of such cooperation: • Fraud. Unscrupulous hotel owners offer their services in order to steal clients' ASICs. Most often, such companies have the most favorable conditions. • Equipment insecurity. Systems may break down and the guard may fall asleep. During this time, theft, fire, or breakdown due to a power outage may occur. If these aspects are not monitored by hotel staff, the equipment is at great risk. • Poor quality of services. Hotel employees may turn off the device, abandon it, or not make contact. A low level of service is possible in any industry, hosting is no exception. A well-drafted contract can protect you from many risks.

The price of electricity is not paramount

People in Europe contacted me. I suggested to them, let's go to Russia. They refused.

It is important not where electricity is cheaper, but where it is more reliable. The price of electricity can be twice as different. But these two times mean nothing if you are not thinking about immediate benefits, but think strategically for several years ahead.

Find out how long the company has been in existence. Did you survive the last peak and recession?! We have cases of clients, how they were scammed on equipment, and there is a case of our competitors who closed down. For example, we were contacted by a client who had been trying to return his equipment from a fly-by-night mining hotel for almost a year and returned only half of what was taken out (everything was sold in parts). The client shared that they took everything out in one night. Our competitors, with the same price for electricity at the time of launch, did not raise prices for their customers following the increase in tariffs and eventually closed, far beyond the break-even point, since this was how their contract was drawn up. We have already discussed the importance of a simple and clear contract in the article A good contract is a short contract.

Other cities in Russia

Taking into account the growing demand, the number of mining hotels in Russia over the past year has increased 6 times compared to previous figures. Therefore, you can find such data centers in almost all major cities.

Particular attention was paid to regions with the lowest electricity bills, which guarantee not only profits for the owners of mining hotels, but also favorable conditions for customers. Large mining centers are located in:

• Irkutsk;
• Saransk;
• Chelyabinsk;
• Ivanov;
• Tyumen;
• Nizhny Novgorod.

Hotels often move to these cities from Moscow and St. Petersburg. The main reason is the high cost of electricity, which makes the hotel unprofitable. Many experts agree that getting electricity is cheaper than 3.5 rubles. per kilowatt, in the central regions it is impossible. At least legally (those hotels that take risks are real bubbles that will burst after the first law to regulate such centers).

In general, try to choose mining hotels so that they are as close to you as possible. This will provide certain guarantees and safety that everything will be in order with ASICs or farms, and will also allow you to easily familiarize yourself with the storage conditions of the equipment yourself. The second criterion, of course, is cost. In this sense, experts do not recommend chasing cheapness, because in the field of mining hotels it is associated with risks in 95% of cases.

What is important for a mining hotel

In the article “Renting a rack in a data center or how to choose a data center” we listed a huge number of parameters that should be in a data center.

Some data centers house mining equipment in their empty racks. And it looks like hammering a shoe nail with a sledgehammer or a staple with a shoe hammer.

The mining room has weaker temperature requirements. Since the equipment generates a lot of heat, the proximity of ASICs to regular servers is harmful to the servers. Of course, these are not miners' problems. It is better for owners of regular servers to think about this.

Raised floors, racks, 100% uptime, power backup via UPS and diesel generator set are not needed for mining. This only leads to higher prices. However, the quality of communication remains important. Mining hotels on cheap home routers with 3G modems will not be able to provide acceptable communication quality, low ping, low jitter, zero packet loss, and therefore not all decisions will be made by pools precisely because of communication problems, simply because someone then he will have time to convey the decision faster.

List of hotels in St. Petersburg

Recently, many so-called “premium mining hotels” have been created in St. Petersburg, which use huge areas, professional cooling and competent technical support. These are not just storage facilities for equipment, but real data centers where you can rent space for your devices. Such institutions have a very strict selection policy, which is why mining farms in them are often closed. This is due to certain storage difficulties and energy consumption. But ASICs can not only be installed in storage facilities in St. Petersburg, but also purchased immediately on the spot.

Of those that have a positive reputation, it is worth noting:

• Lab113;
• BitMineCorp (mining boutique);
• Crypto mine.

What is important for hosting mining equipment

1. Fixed cost, independent of the exchange rate. The mining hotel should not take any commission from the volume mined or tie the price to the cryptocurrency rate
2. Excellent ping and redundant communication channels.
3. No “own pools” and no commission from the mined one.
4. Legal electricity. It will be very unpleasant to find out that all the equipment was seized by the police due to the fact that the mining hotel was stealing electricity
5. Stable temperature.
6. Professional technical support engineers.
7. Farms need to be assembled in unit buildings, not a collective farm on sticks.
8. It's good if the company has licenses.

Main types of ASIC antminer miners

Antminer S9/S9j

• Consumption - 1.4KW
• Cost - from 2800/month
• Port 100Mbps
• Private VLAN network
• VPN for management
• Monitoring 24/7

Antminer S17/S17pro

• Consumption - 2.3-2.9KW
• Cost - from 4700/month
• Port 100Mbps
• Private VLAN network
• VPN for management
• Monitoring 24/7

INNOSILICON T2T-26T

• Consumption - 2.1KW
• Cost - from 4300/month
• Port 100Mbps
• Private VLAN network
• VPN for management
• Monitoring 24/7

We also post any other modifications of mining devices and GPU farms

Cooling of mining equipment

In winter it is cooled by forced ventilation. It is unwise to run industrial air conditioners. In summer you need air conditioning. And it’s worth making sure they are available. There have already been examples when equipment was simply placed in halls with high ceilings, but in the summer in Russia the heat can reach 40 degrees and you shouldn’t hope for natural cooling. Cooling equipment in containers also poses a number of challenges. Firstly, high equipment density with a small volume. Secondly, the metal container quickly heats up not only from the equipment, but also from direct sunlight. There have been cases when powerful fans sucked in rain or snow along with the outside air, which led to the failure of expensive equipment

Accommodation options

So, let's talk about accommodation options.

In China

Pros: no need to transport equipment; you can send any ASIC under warranty. Cons: the mining hotel is very far away and it will be difficult to react in case of unforeseen situations

Place in Russia officially

Pros: few risks in terms of inspections from various authorities. Cons: high price, ASICs also need to be imported “in white”.

Place in Russia unofficially

Pros: cheap. Cons: there are many risks in terms of the legality of placement.

Mining hotels are convenient, but there are risks that need to be considered before transferring equipment.

How to choose where to place mining equipment

Let's try to give you a list of parameters by which you can build a comparison table to decide where to place your mining equipment. It makes sense to divide the collection and analysis of information about various mining hotels into the following areas:

1. company information;
2. technical parameters of the mining site;
3. licenses
4. completeness of services provided
5. price

All collected data should be compiled into a Google Sheets table, qualitative data should be converted to quantitative data through expert assessment, for example. Enter significance weights. Set a formula for calculating the final grade, which will allow you to get an objective comparison. Be sure to first visit the data center with an introductory tour.

Information about the supplier company

The data listed below can be collected when choosing any supplier of services or goods, be it stationery or food.

Use the TIN to identify the company on various services; you can simply paste the TIN into the search bar. Collect the following information:

1. Company age. Year of foundation according to extract from the Unified State Register of Legal Entities.
2. Does the legal registration address coincide with the actual address.
3. Average number of employees.
4. Turnovers for previous years.
5. Taxes and salary contributions.
6. Court cases.
7. Enforcement proceedings.

It is very convenient to compare the listed data, because they are already numerical. It's more difficult with ships. A complete absence of court cases is as bad as a large number of them. Share courts with customers and suppliers. Next come the quality options, which you will have to evaluate individually.

Management contacts

Systems don't work without feedback! A guarantee of high-quality provision of services and maintenance are management contacts in the public domain, if you don’t want to listen to all sorts of nonsense from ordinary employees like “unfortunately, we work differently, but we will take into account your wishes.” Any employee should know that if he provides poor service to a client, the client can complain directly to the head of the company. Otherwise, communication with such companies is like a wall. This is how banks, Yandex, Google, hh.ru and many others communicate with us. Over the years, we have never been able to get any large organization to improve its business processes or quality of service.

Reviews and reactions to them

Look at reviews of the organization and reactions to reviews. If there are a lot of positive reviews, then perhaps they are custom-made.

history of the company

On the website nalog.ru, an extract from the Unified State Register of Legal Entities will tell you a lot. How long has the company existed, how often has its management and owners changed.

Server room location

We recommend placing equipment for manning geographically in the region where you are not far from travelling. If you place the equipment several thousand kilometers away from you, then if something happens, getting there will be a real problem for you.

Technical parameters of the machine room

Accidents, downtime, uptime

The server room has such a concept as uptime - the time of uninterrupted operation from the moment of launch. Server uptime can also be measured in relative units - percentages. How is server uptime calculated as a percentage? From 100% we subtract the downtime of the server room, divided by the entire operating time of the mining hotel. What determines the machine room downtime:

1. server software failures;
2. failures of mining equipment (ASICs, GPU farms may fail and require repair);
3. interruptions in the operation of the mining hotel:
   failures or accidents in the cooling system;
4. accidents in the power supply system;
5. accidents on routers and communication channels, DDOS attacks;

Absolute 100% uptime is rare. But for mining, 99.5% is quite a sufficient level. We can talk about local uptime for a given period of time, and as shown above, it is necessary, at a minimum, to distinguish between three different types of uninterrupted operation. Accidents were, are and will be everywhere and always. Some cases can be minimized, in others the time to eliminate them can be reduced, but it is completely impossible to get rid of them. It is possible to minimize the human factor, but it is impossible to get rid of the failure of terminal equipment.

Licenses for communication services

Check availability of telematics and data transfer licenses. It is desirable that they exist.

About technical support and access to equipment

Find out if there is 24/7 support and if you can access the equipment at any time - the ability to bring and collect. What problems will they help you with and what problems will they not help you with?

Channels

At least two fiber optic channels from different providers and different routes must be suitable. If there is only one channel and it is cut by an excavator, then it will take a long time to restore it.

Minimum ping is critical. To analyze the quality of communication channels, pay attention to:

• ping value;
• average connection time;
• average DNS server response time to obtain an IP address for a domain;
• uptime and accident times over the past few years;
• actual data download speed.

Who is the manufacturer of electrical equipment?

The power system must be assembled using reliable components from leading global manufacturers, for example, Schneider Electric. Cheap components are more likely to cause a fire.

In what premises should and should not a mining hotel be located?

The mining hotel should not be located in a basement, bunker, or bomb shelter, because there is a risk of flooding!

The mining hotel should not be located in a bomb shelter, because the bomb shelter may be asked to be vacated within 24 hours!

It also should not be located in an office building, because the unpleasant noise from the operation of the equipment spreads throughout the building!

When placing equipment above the ground floor, consider the load on the floor.

In factory workshops with high ceilings in the summer there will be a problem with heat removal.

Mining in containers is a bad idea, since you don’t even need to dismantle and take out the equipment; they drove up, picked it up with a crane and stole it. But you can’t just pull it out of the server room in 5 minutes.

Hotel advantages

The hosting of mining equipment must meet the requirements for successful “mining” of digital money.

The main advantages of a quality hotel:

1. Installed ventilation or air conditioning system. Mining equipment already has elements for cooling “internal organs.” But this is not enough if the device is working at full capacity, and it is summer heat outside.

2. Improved electricity supply system. The equipment may fail if there is a power outage. A high load on the “socket” is a risk of fire. Especially if the “mining” is carried out in an old apartment building. Therefore, hotel owners must approach the issue of electrification with complete seriousness. The cost of an error in calculations when designing cables amounts to hundreds of thousands of rubles, and sometimes millions. High-quality hosting is distinguished by additional machines and reinforced wiring. It is also important to choose the right power supply for the ASIC.

3. Installed air filtration system. The room must be constantly ventilated, but to prevent dust from settling on the equipment, filters must be installed on the air supply. When working with dozens of devices and air conditioning systems, ASICs can become covered in dust after just two to three months of active mining. Any electronic equipment cannot stand such a neighborhood, so it is important to check the cleanliness of the premises before handing over the farm and check the monthly maintenance. maintenance in the form of blowing ASICs.

4. Stable Internet. To connect all devices to the network, a stable Internet is required, the connection speed of which will be sufficient for the operation of ASICs. It is important to understand that communication breakdowns are the main reason for unsuccessful “mining” of cryptocurrencies.

Safety

Access control must be organized on the territory of the mining hotel. The possibility of unauthorized persons entering the territory or technical premises of the data center must be excluded. There must be a guard rotation of at least two people and regular patrols. An agreement for the departure of armed guards must be signed. The staff on duty must have a panic button.

Access directly to the machine room must be carried out in the presence of an engineer.

If the mining hotel's machine room is located above the first floor, it must be possible to use an elevator and carts to move equipment.

A mining hotel must have at least a fire alarm, and in general a full-fledged fire extinguishing system is needed.

The mining hotel must have cameras that fully view all approaches and passages to and inside the mining hotel. The archive storage depth must be at least 30 days.

Completeness of services provided

Please note the list of basic and additional services. Familiarize yourself with the text of the contract and the capabilities of the contractor. You may need:

1. Possibility of payment by cards, electronic money and other payment methods.
2. Receiving acts, invoices through electronic document of turnover (EDT) channels.
3. Receiving a cash receipt in accordance with 54-FZ.
4. Possibility of round-the-clock access and technical support including holidays and weekends.
5. Support by phone, email, personal account requests, chat on the website and Telegram.
6. Client room - a separate room for working with equipment.
7. Kitchen - an opportunity to drink tea, coffee and have a snack.
8. Warehouse and storage rooms.
9. Monitoring and administration of client resources.

Price

It makes almost no sense to compare prices for mining hotel services. This point comes last in importance. On the horizon of 2-3 years, it is important not to save a penny on electricity, but to find a reliable service provider that will not disappear.

Final checklist of mining hotel characteristics

Everyone can change the weight of each parameter and the parameters themselves. They are given here as an example. For residents of other regions, the formula will differ in a number of characteristics.

Completeness of services provided

Please note the list of basic and additional services. Familiarize yourself with the text of the contract and the capabilities of the contractor. You may need:

1. Possibility of payment by cards, electronic money and other payment methods.
2. Receiving acts, invoices through electronic document of turnover (EDT) channels.
3. Receiving a cash receipt in accordance with 54-FZ.
4. Possibility of round-the-clock access and technical support including holidays and weekends.
5. Support by phone, email, personal account requests, chat on the website and Telegram.
6. Connecting your telecom operator or connecting your gray optics.
7. Connecting USB dongles and additional devices, such as an antenna.
8. Assistance in obtaining communication licenses and handing over a communication center.
9. Possibility of placing non-standard equipment.
10. Virtual servers, SSL certificates, domain registration.
11. Client room - a separate room for working with equipment.
12. Kitchen - an opportunity to drink tea, coffee and have a snack.
13. Warehouse and storage rooms.
14. Monitoring and administration of client resources.

Payment for services in a mining hotel, rules for users

The cost of renting platforms for cryptocurrency mining may vary depending on the conditions and rules established by the hotel administration. An important point when renting is the signing of an agreement, which will spell out the requirements and responsibilities of the parties.

In the contract, it is necessary to check the correctness of the address, the time and date of the lease, as well as the rental period. It is also necessary to carefully read the clause on the obligations of the parties and the requirements for the client. Correctly drafting the contract will allow you to receive the necessary services in full.

Hotel rates for cryptocurrency mining

One of the criteria when choosing a mining hotel is the cost of renting premises. Tariff plans may vary; detailed information can be obtained from the administration of a particular complex. Average rental prices are presented below:

• For Moscow residents, rent will be 2,900 rubles per piece of equipment per month.
• In St. Petersburg, the cost will be 2,400 rubles per month per unit of equipment.
• For the same conditions in Irkutsk you will need to pay 1,700 rubles.

The cheaper the rent, the greater the profit from mining. In this regard, experienced users try to find hotels with reliable equipment and low rental costs.