
Inside One of the World's Largest Bitcoin Mines - mlevy
http://www.thecoinsman.com/2014/08/bitcoin/inside-one-worlds-largest-bitcoin-mines/
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CatsoCatsoCatso
This just strikes me as a colossal waste of energy & time. I understand that
there may be good profit in doing it, but that doesn't shirk off any of my
feelings.

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maxmcd
More inefficient than producing and maintaining paper currency? Than mining
actual gold?

They really are just throwing tons of electricity and hardware at "nothing",
but if this kind of activity helps replace the current inefficient systems of
currency, then I'm all for it.

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tveita
Yes? Going either by volume or number of transaction, Bitcoin transactions are
currently ludicrously expensive, though this is somewhat hidden by subsidizing
the miners.

I don't know why you mention paper currencies and gold when most money today
is transferred electronically, in a far more efficient way than Bitcoins.

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jacquesm
I'm not sure if by the time you factor in all the costs of banking (including
bail-outs) bitcoin is still ludicrously expensive.

And one block will include a whole slew of transactions, that's fixed overhead
with economies of scale built in.

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bduerst
Quid Pro Quo: Bank bailouts had positive returns.

Mt. Gox collapsing was a worse wealth loss than bank bail outs, by far.

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baddox
> Bank bailouts had positive returns.

Compared to what? You can't compare it to the results of not having done
bailouts, so the comparison is largely a matter of economic prediction, and
economic prediction is obviously very controversial. The only non-
controversial part is that the bailouts were certainly very good for the banks
receiving them.

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dllthomas
In an accounting sense. The government received more money back then they put
in - even, IIRC, adjusted for inflation. I agree that this is not actually a
great metric, but then "bailouts" aren't actually a great example of the costs
of dollars vs bitcoin - they mostly had to do with debt, and you could
certainly still issue debt in a world run on bitcoin.

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mlevy
I'm just curious if anyone has insight into how this is economical. Is it
economical with current bitcoin prices, or only if prices go up?

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burgers
To add to another reply, the big perk of bitcoin mining is that you can
launder your money through the purchase of equipment, real estate and power
directly into US Dollars.

It's as that comment said, basically just a way to turn Renminbi into Dollars
without the Chinese government knowing about it.

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thedaveoflife
How long do you think the Chinese government will allow this subversion to
continue? It seems like something they would aggressively shut down.

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burgers
I don't know enough about Chinese politics to be able to reliably comment on
their intentions, but buying dollars like this could help push down the price
of the Renminbi compared to the Dollar. That has been part of China's economic
policy for a long time. Also, when you think about how China is under
international pressure to allow the Renminbi to start naturally moving up in
value, these types of currency pressures would certainly make a nice way to
keep the Renminbi low without having to responsibility for it.

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jacquesm
The scale of this is impressive regardless of whether or not you're a bitcoin
believer (I'm neutral, if it works long term, great, if not something better
will come along).

This bit in particular is impressive:

"The mine operators told me that each warehouse took fifteen days to
construct, and an additional ten days to fill up with hardware and get it all
hashing away. The concrete was still drying on some of the buildings."

8 of those... I wonder who supplied the chips that do the mining and how much
energy that facility uses.

"This entire facility has several petahashes of mining power, accounting for
perhaps 5% of the entire bitcoin network. Damn."

I like their cooling solution as well!

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nmjohn
> I wonder who supplied the chips that do the mining and how much energy that
> facility uses.

Probably part of the reason this is in china - close to the factories where
the majority are produced. The owner could walk into a chip manufacturer and
make a much better offer than the cost of exporting and packing them to ship
internationally.

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burgers
Especially if said miner could pay to the chip makers offshore bank account
with his offshore bank account funded by bitcoin mining.

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gwern
> They keep the machines cool with an evaporative cooling system. Its
> basically a durable paper product that looks like the wavy corrugated part
> on the inside of cardboard. Water is pumped to the top and flows down, and
> the fans blowing outwards on the other side create negative air pressure,
> drawing fresh air through the holes and cooling it.

The cardboard cooling system looks pretty interesting, but I wonder how
durable it is: cardboard which is constantly wet doesn't sound like it'll last
too long.

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wilsonfiifi
It's the same system/technology used by Port-A-Cool
[http://portablecoolers.com/models/PAC2KCYC01.html](http://portablecoolers.com/models/PAC2KCYC01.html)
and this is one of their promo videos
[https://www.youtube.com/watch?v=WoI1BDEiawY](https://www.youtube.com/watch?v=WoI1BDEiawY)

I was searching online for cooling systems that could run on solar power and
"evaporative cooling" seemed like a good candidate. I was looking for a "whole
house cooling system" though but these folks come up in the search results.

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elwell
Wow, I had no idea there were non-aws miners at this scale.

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valarauca1
Can you mine on AWS? I thought cpu mining wasn't worth it in terms of cost?
And I don't see how Amazon could sell you CPU time cheaper then an electric
bill.

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ihsw
AWS provides instances backed by a GPU -- their G2 instances.

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wcummings
Not even close to profitable.

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autism_hurts
This is hilarious, and if you think this isn't, you're clueless.

