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Inside BitFury's 20 Megawatt Bitcoin Mine 195

Posted by Unknown Lamer
from the fools-and-their-megawatts dept.
1sockchuck (826398) writes Bitcoin hardware vendor BitFury has opened a 20-megawatt data center to expand its cloud mining operations. The hashing center in the Republic of Georgia is filled with long rows of racks packed with specialized Bitcoin mining rigs powered by ASICs. It's the latest example of the Bitcoin industry's development of high-density, low-budget mining facilities optimized for rapid changes in hardware and economics. It also illustrates how ASIC makers are now expanding their focus from retail sales to their in-house operations as Bitcoin mining becomes industrialized.
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Inside BitFury's 20 Megawatt Bitcoin Mine

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  • 20 megawatts (Score:2, Interesting)

    by Anonymous Coward

    pissed away on trendy pointless crypto nonsense

    i can't believe this has gotten so stupid and out of hand

    • by alen (225700)

      from what i read bitcoin is going to replace some of the kooky virtual currencies that multinationals have used for their virtual goods stores like the old MS coins to buy xbox games and DLC.

      the cost is paying to hedge against currency fluctuations and paying the exchange costs. bitcoin might solve this problem

      • The technology that underlies bitcoin, data secured by a series of chained hashes, such that the hash for one data block is part of the data for the next, enables a secure record keeping system for electronic data. Any change to past data, whether from errors or malicious tampering, is detectable because re-hashing the contents of a data block will give a different result than the one stored in the next block.

        This is highly useful for a financial transaction system, the first application bitcoin represents

    • Re: (Score:2, Interesting)

      by ShanghaiBill (739463)

      i can't believe this has gotten so stupid and out of hand

      However, no bitcoin miner has been bailed out with my tax dollars. So they are still doing better than the "real" banks.

      Twenty megawatts at 5 cents per kwhr is about $1000/hour. Wall Street likely uses a thousand times as much just to light their offices.

      • Re:20 megawatts (Score:5, Insightful)

        by tnk1 (899206) on Friday August 01, 2014 @02:12PM (#47583329)

        Considering that bitcoin isn't big enough, nor has it been around long enough to bail out, using the bank bailouts as a comparison is a specious justification.

        Just because a new system is different than a bad system, does not logically imply that it is a better system by default.

      • by Yunzil (181064)

        Difference is, at least light bulbs serve a useful function.

    • Re:20 megawatts (Score:5, Insightful)

      by Boronx (228853) <evonreis@mohr-enginee r i ng.com> on Friday August 01, 2014 @02:05PM (#47583281) Homepage Journal

      Modded down for telling the truth. These guys are wasting a small town's worth of power to do worthless calculations.

      • Modded down for telling the truth. These guys are wasting a small town's worth of power to do worthless calculations.

        On more than one occasion I have used bitcoin - that I mined myself - to buy something useful.

        I created real money out of thin air using "worthless calculations" and then purchased a good or service with that money directly.

        Crypto mining is NOT worthless.

        Crypto is NOT going away.

  • Good Thing (Score:5, Insightful)

    by Anonymous Coward on Friday August 01, 2014 @01:26PM (#47582885)
    Good thing you're not solving real problems. What. A. Fucking. Waste.
    • Re:Good Thing (Score:5, Insightful)

      by Burz (138833) on Friday August 01, 2014 @01:35PM (#47582987) Journal

      Good thing you're not solving real problems. What. A. Fucking. Waste.

      It just proves that a carbon tax cannot come soon enough.

      • They did that in AU. It didn't help.
        • It was overturned with good help from Australia's coal lobby, not quite the same as "didn't work".

        • Actually it was working as advertised, that's why our current far right government was so hell bent on getting rid of it.
        • by Burz (138833)

          "The government argues the carbon pricing scheme has been ineffective, but national emissions have actually fallen by 0.8% in the first calendar year of its operation, the largest fall in 24 years of records."

          http://www.theguardian.com/env... [theguardian.com]

      • It just proves that a carbon tax cannot come soon enough.

        Except that their mining centers are located in Iceland, Georgia (the country, not the state), and Finland, close to cheap carbon free hydro electric dams.

        • by Nethead (1563)

          Quincy, Washington, US. Get on Google Maps and see if you can see which large buildings are data centers and which are potato warehouses. Hint, potatoes don't need backup generators. The big one is Microsoft.

      • Good thing you're not solving real problems. What. A. Fucking. Waste.

        It just proves that a carbon tax cannot come soon enough.

        Too bad it's a total scam (which we knew about way back in 2009, BTW):

        The new carbon credit market is a virtual repeat of the commodities-market casino that's been kind to Goldman, except it has one delicious new wrinkle: If the plan goes forward as expected, the rise in prices will be government-mandated. Goldman won't even have to rig the game. It will be rigged in advance.

        Here's how it works: If [Cap and Trade] passes, there will be limits for coal plants, utilities, natural-gas distributors and numerous

    • Re: (Score:2, Interesting)

      by ultranova (717540)

      Good thing you're not solving real problems. What. A. Fucking. Waste.

      How much energy is spent fighting against counterfeit cash? And do you perhaps think point-of-sale systems and credit/debit card systems or wire transfers require none? And armored trucks for moving money, those surely require no fuel?

      • by Carnildo (712617)

        And do you perhaps think point-of-sale systems and credit/debit card systems or wire transfers require none?

        The Bitcoin network uses about $35 worth of energy to process a single transaction. Now, I don't know how much energy a single credit card transaction uses, but given the transaction fees that processing companies charge, I'm willing to bet that it's far, far less than $35 worth.

        • by ultranova (717540)

          The Bitcoin network uses about $35 worth of energy to process a single transaction.

          This seems extremely unlikely, since processing a transaction means transmitting a few hundred bytes and doing doing some simple cryptography and database lookups.

          Now, I don't know how much energy a single credit card transaction uses, but given the transaction fees that processing companies charge, I'm willing to bet that it's far, far less than $35 worth.

          Yet for some reason you think this logic doesn't apply to Bitcoin tr

    • Why did you spend 10 seconds writing that post when you could be contributing to the search for a cure for cancer?

      How many precious minutes have you wasted combing your hair? Trimming your toenails? Time's a-wastin'!

    • Good thing you're not solving real problems. What. A. Fucking. Waste.

      This a thousand times over. Run this equipment with World Community Grid or Folding@Home, might lead to curing cancer [worldcommunitygrid.org] or AIDS [worldcommunitygrid.org]. Fuck, just donate it to some medical research effort [alz.org] and maybe in 20 years a cure will come out and save your ass.

      Bitcoin? Megawattage flushed down the entropy hole. Wouldn't it suck for all the bitcoiners if a talented mathematician found a way to trivially circumvent [wikipedia.org] the bitcoin exchange system or if someone came up with a new cryptocurrency that people just liked better (I th

    • So true.

      We live in the days of global warming and wanting to find new ways to be more efficient with our power use.

      But of course people burn megawatts to do useless calculations to "discover" hidden codes that are given "value" through mystical means - backed by fiat currency too just to make more of a mockery.

      Almost as bad as the stock exchange and all the high freq. traders....almost.....
    • Good thing you're not solving real problems. What. A. Fucking. Waste.

      I bet you would change your tune if you had been making bitcoins by the hundreds or thousands per day using just a cheap CPU, back when it first came out.

      Or, you did and you didn't keep them....

  • by Opportunist (166417) on Friday August 01, 2014 @01:29PM (#47582929)

    As far as I can judge, and please correct me if I am wrong, running a bitcoin mining farm isn't really something that ties up a lot of your time. I might be a bit naive, but... isn't it just "flip the switch and, well, wait"?

    If it's not so, the next question is probably moot, but if it is: Why would anyone SELL bitcoin mining rigs instead of simply building them and getting rich themselves? To me the whole deal smells a bit like those crystal ball experts who tell you next weeks lottery numbers... why, if it works, don't they play themselves and get rich themselves?

    • by maliqua (1316471)

      some do
      some don't

      i personally think that the ones that don't are just unwilling to gamble on an unstable 'currency'

      • i personally think that the ones that don't are just unwilling to gamble on an unstable 'currency'

        Or they know it's yet another doomed-to-fail commodities market that favors the big players over everyone else.

    • by Rinikusu (28164)

      The guys that made all the money during the San Francisco Gold Rush weren't the guys panning for gold, but the guys selling shovels and food. Same concept here. Why get out there and hope to "get lucky" on a completely unproven commodity when you can sell the equipment to the actual speculators? It's not just a matter of flipping a switch and waiting, btw, there's power consumption. A farm like in the article isn't running off house mains, generally speaking, not to mention the actual space, cooling, an

    • by Solandri (704621) on Friday August 01, 2014 @01:48PM (#47583133)
      Selling bitcoin mining rigs is a guaranteed profit.

      Mining bitcoins is a potential profit, potential loss. It all depends on what happens to the value of bitcoins. Your reasoning only works if the equipment seller is absolutely certain that bitcoins will hold their value. From what I gather, the vast majority of people don't think they will, but will happily sell equipment to those who do.
      • by chispito (1870390)

        Selling bitcoin mining rigs is a guaranteed profit.

        ...assuming a guaranteed buyer.

    • by ledow (319597)

      There's datacentre-level maintenance but otherwise, yes.

      However, where you get rich is not in mining the coins for yourself - have you not seen the "mine your own bitcoins, just $X/month" adverts? You lease that crap out to people hoping to make a fast buck and/or hide their trail somewhat in converting currency to Bitcoins (sure, they bought a Bitcoin server - but which Bitcoin did they actually MINE? - it's quite difficult to trace if the hosting firm is willing to not keep traffic logs).

      But then, there

    • by magarity (164372)

      Why would anyone SELL bitcoin mining rigs instead of simply building them and getting rich themselves?p>

      It's right there in the opening phrase; this IS a case of someone who sells the systems using it themselves: "Bitcoin hardware vendor BitFury has opened ..."

    • Risk.

      You can make a lot of money building up bitcoins. It may take a year to get your investment back, and then 3 years to get major profitability. You're going to essentially be rich as fuck in 10 years' time.

      In 2 months, the bitcoin market might crash. This bubble has to pop some time. By cashing out the marginal value of your bitcoin mining rig now, you reap immediate guaranteed profits and transfer the risk of loss to the customer.

    • by tnk1 (899206)

      Those who buy the rigs have money and business connections, but don't know how to build good rigs. Those who build them don't have money or connections, but plenty of experience making rigs.

      Sometimes those two capabilities overlap, but there's a lot more investors out there than there are computer hardware experts.

    • by tompaulco (629533)

      Why would anyone SELL bitcoin mining rigs instead of simply building them and getting rich themselves?

      one might ask the same question of companies that sell industrial mining equipment.

      • There is still a considerable amount of time investment necessary to turn mining equipment into iron ore.

        Turning Bitcoin mining equipment into bitcoins is ... well, turn it on. Wait.

    • Why would anyone SELL bitcoin mining rigs instead of simply building them and getting rich themselves?

      Same reason that people sell get rich quick schemes to the gullible rather than getting rich off the scheme themselves. They know there is no profit to be had in the actual mining of bitcoins but there is money to be had selling virtual shovels to those dumb enough to not figure this fact out.

      If you really could make millions mining bitcoins why would you tell anyone?

    • Risk aversion. If you mine the coins, you're subject to the highly unpredictable swings of the market - your vast bitcoin fortune could be reduced to a tiny fraction overnight. If you rent the miners, then even if that happens you still have your money.

    • Almost all hardware manufacturers *do* mine with all the hardware they make. They make it and mine with it even after you have paid for it. They then ship it to you right before the break-even point. There are endless stories out there about missed shipping deadline after missed shipping deadline, mining hardware companies making empty promises, and would-be miners receiving hardware a few months too late, by which point their projected return is orders of magnitude smaller than it would have been due to th
    • Why would anyone SELL bitcoin mining rigs instead of simply building them and getting rich themselves?

      They'd lose money by giving up their competitive advantage. Specifically, while anyone with money can buy bitcoin mining gear, very few people can build some. Produce and sell the mining gear, and you get guaranteed and instantaneous profits. Also, producing the specialized computers you're competing against other businesses; mining bitcoins you're competing against everyone who follows the "easy money this way" sign. Also if the latter group is optimistic, it means you can sell the mining gear at higher th

  • What a colossal waste of power. Personally, I'd like to see a cryptocurrency where the production of the coins is directly related to the amount of energy produced by a particular source.

    For example, a 3MW solar farm could produce N number of coins every day. But a 3GW nuclear plant could produce 3000N coins every day. This way the power can be still use productively but the currency is directly tied to the energy produced. So essentially it'd be a non-fiat currency based on the real world.
    • by Yebyen (59663)

      "based on the real world" so, you mean, in fact completely unreal and made of unicorn dust.

      How would you tie energy generation to coins? I'm assuming the point of your proposed solution is that the coins are a reward for generating energy, and producing the coins does not actually consume the power. So, how do you make it provably fair? Install ammeters at each generation site with embedded DRM protections?

      Why not just sell the power?

      • Good points. The details are obviously scarce as I'm not sure of the best way to go about doing this. Something like the ammeters like you suggest is what I was envisioning.

        As for not just selling the power...Ideally this scheme would be used to provide a basic income for those who do not have any money to start with. Sure, selling some of the power might help to provide a measure of viability. I'm thinking this would be a basis for a basic income that isn't completely detatched from reality. 'Based
    • What a colossal waste of power.

      The electricity that goes in Bitcoin mining is essentially converted to 100% heat. So the problem can be avoided every time when the heat can be utilized somehow, for example to warm up a house. Which is, of course, almost never. ;)

    • I've thought of this possibility, though in a different manner. Off-grid solar. Those setups need enough panel capacity to generate requirements during cloudy winter days, which means that in summer or better weather they have excess capacity - once the batteries are charged, it's just going to waste. So it might make sense to put this 'free' energy into something like bitcoin mining or scientific computing.

      If you had a really big off-grid renewable setup, you could concievably rent out the space: Put your

  • Environmental ROI? (Score:5, Interesting)

    by nickovs (115935) on Friday August 01, 2014 @01:45PM (#47583109)

    This begs the question whether mining for BitCoins is more damaging to the environment than mining for precious metals, for a given value of return. The EPA emissions factor [epa.gov] for electricity is about 0.69 tons of CO2 per megawatt hour, so producing the electricity used by this datacenter is, on average, dumping into the atmosphere 331 tons of CO2 per day or about 120,000 tons of CO2 per year. While there are many other forms of environmental damage from gold mining, a quick search suggest that the greenhouse emissions from gold extraction [eoearth.org] run to about 11.5 tons of CO2 equivalent per kg of Gold. At this rate 120,000 tons of CO2 yields of 10.5 tons of gold, worth nearly $500 million at today's price. Will this datacentre yield more than half a billion dollars worth of bit coins each year?

    • by OzPeter (195038)

      The EPA emissions factor for electricity is about 0.69 tons of CO2 per megawatt hour, so producing the electricity used by this datacenter is, on average, dumping into the atmosphere 331 tons of CO2 per day or about 120,000 tons of CO2 per year

      Given that the data center is in the Republic of Georgia [wikipedia.org] and not the US state of Georgia [wikipedia.org] I don't think that the EPA estimates really have any relevance. If anything the numbers are probably much much worse.

      • Why should the numbers be "much much" worse?
        Neither are the laws of physics different in the Republic of Georgia nor are the coal plants in the US state of Georgia known to be particular efficient.

    • by Shatrat (855151)

      A) No it doesn't beg the question. http://en.wikipedia.org/wiki/B... [wikipedia.org]
      B) Electricity in the Republic of Georgia is almost all Hydroelectric.

    • I thought the trouble with mining gold was more to do with the "interesting" chemicals used to separate a few specks of gold from a few tons of rock, than the energy cost of the process. Not that the computers used for bitcoin mining don't themselves require lots of "interesting" chemicals.

  • Donate 1000 satoshi or more to my microwallet (17Yvsma9tfiuqVP7QhsFE2VmsFpTEMy17P). All donations will be used to pay for the time needed to write funny comments on Slashdot.

  • Money (exchangeable value) has always driven innovation. The application-specific integrated circuits made just for Bitcoin math were rapidly developed and produced in mass quantities in multiple variations. All of this if about a 2 year span at most. These the ability to quickly design and produce ASIC chip is real innovation here and actually commodity. It won't be long now before we have ASIC for all kinds of number crunching and specific tasks. It's hardware that's innovating and changing nearly as fast
    • by fgodfrey (116175)

      The ability to quickly design and produce an ASIC is hardly new or innovative here. ASICs are one of the few pieces of computing that you can get done faster if you just throw more people at the problem. Plus, I have a strong suspicion that most Bitcoin mining ASICs are Gate Array ASICs (http://www.fujitsu.com/emea/services/microelectronics/asic/asic/techprod/gatearray/) which, if my understanding of them is correct, use a bunch of standard layers and interconnect them with a few custom layers. That redu

  • All this effort, resources and real money being flushed down the drain for imaginary currency.

    Whoever ACTUALLY coined the phrase attributed to P.T. Barnum was off by a factor of measurement at least.

  • are the utility companies.
  • What will they do with all that computing power once they will have mined the last bitcoin? I wonder if such setup could be crack and steal existing bitcoins.

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