Self Hosting vs Colocation

[.F.]

Hi All,

I ordered two Antminer S9s and hope to scale to 50-75 (or more if BTC goes moon) by the end of the year. I'm debating whether or not I should build out my own self-hosting site in my garage (it's a large, detached from my house by 100 ft 3 car garage) OR send the miners to a colocation site that can host the miners for $100-$150/month/miner. I have no networking background and a full-time job in venture capital. So I'm leaning towards this option, especially if they can monitor them and provide uptime support. What's a good price offer for a miner colocation?

However, my profit calculations project my own mining operation could be very profitable, so I'd be willing to give up my job if it turns into something worthwhile. And, at the moment, I have access to free electricity in my garage (my family pays for it - we own a real estate company. Otherwise local kwh is 5.7 cents). But even with free electricity, this option is by far the largest investment upfront since I'll need to install an HVAC (up to 10-20k CFM fans and exhausts), lots of power, networking equipment, better internet access, etc. I also live in the Midwest and so the summer gets very humid - so that's not great for the equipment I've heard. Plus there is the noise issue of having 50-75 miners in my garage and the neighbors not being too happy about that. All that said, I think I could get around 50 to 75 units in my garage. At that point, I'd 100% need to quit my job to maintain it.

Any advice or guidance? My main concerns for self-hosting are: 1) humidity 2) noise 3) lack of experience. Main concerns for colocation: 1) cost and future cost increases 2) if they don't provide support, not having access to the miners immediately if something goes down.

**ALSO**

I'd also be interested to know what miners who have S9s are making in BTC per month.

There seems to be a lot of people who like to have an opinion on this by using an online calculator to determine profits but the calculator vs what people are saying they're making isn't aligning. For instance, I've been seeing people say they make $25-$30 a day per device. That's about $750/month. Subtract out about $100 of electric costs and you're at $650. The online calculators are showing around $350 to $400 / month.

Very confused.

 THANK YOU!!!!   

[philipma1957]

Hi All,

I ordered two Antminer S9s and hope to scale to 50-75 (or more if BTC goes moon) by the end of the year. I'm debating whether or not I should build out my own self-hosting site in my garage (it's a large, detached from my house by 100 ft 3 car garage) OR send the miners to a colocation site that can host the miners for $100-$150/month/miner. I have no networking background and a full-time job in venture capital. So I'm leaning towards this option, especially if they can monitor them and provide uptime support. What's a good price offer for a miner colocation?

However, my profit calculations project my own mining operation could be very profitable, so I'd be willing to give up my job if it turns into something worthwhile. And, at the moment, I have access to free electricity in my garage (my family pays for it - we own a real estate company. Otherwise local kwh is 5.7 cents). But even with free electricity, this option is by far the largest investment upfront since I'll need to install an HVAC (up to 10-20k CFM fans and exhausts), lots of power, networking equipment, better internet access, etc. I also live in the Midwest and so the summer gets very humid - so that's not great for the equipment I've heard. Plus there is the noise issue of having 50-75 miners in my garage and the neighbors not being too happy about that. All that said, I think I could get around 50 to 75 units in my garage. At that point, I'd 100% need to quit my job to maintain it.

Any advice or guidance? My main concerns for self-hosting are: 1) humidity 2) noise 3) lack of experience. Main concerns for colocation: 1) cost and future cost increases 2) if they don't provide support, not having access to the miners immediately if something goes down.

**ALSO**

I'd also be interested to know what miners who have S9s are making in BTC per month.

There seems to be a lot of people who like to have an opinion on this by using an online calculator to determine profits but the calculator vs what people are saying they're making isn't aligning. For instance, I've been seeing people say they make $25-$30 a day per device. That's about $750/month. Subtract out about $100 of electric costs and you're at $650. The online calculators are showing around $350 to $400 / month.

Very confused.

 THANK YOU!!!!  

Hvac  = $$$

online calculators need correct info to be correct.

A suggestion   try the  2 units in the large garage use a gable fan to pull hot air out.

[.F.]

Yeah, that was the plan to see if this was profitable at all. Trying to keep costs low until I establish gross margins and then, if the numbers are right, increasing capacity.

Have you ever checked out Bitcoin Master's videos on youtube (https://www.youtube.com/watch?v=P7Bz1CDQBHM&t=35s)?

He says you need like $150-200k in infrastructure to run 50 S9s. Seems totally off base, right?

[philipma1957]

Yeah, that was the plan to see if this was profitable at all. Trying to keep costs low until I establish gross margins and then, if the numbers are right, increasing capacity.

Have you ever checked out Bitcoin Master's videos on youtube (https://www.youtube.com/watch?v=P7Bz1CDQBHM&t=35s)?

He says you need like $150-200k in infrastructure to run 50 S9s. Seems totally off base, right?

okay  50 x 1400 = 70000 watts

so a 400 amp 240 volt service will do 96000 x .8 = 76,800 watts

70,000 x 4 = 280,000  btus of heat

My entire  home ac - 36,000 btu   I would need 8 ac units

but in a warehouse  set properly a 1600cfm exhaust gable fan can cool 4 units no worries.

so  15 of these

https://www.homedepot.com/p/Master-Flow-1600-CFM-Power-Gable-Mount-Attic-Fan-EGV6/205924917




make this building 32 feet wide

put in 6 of these racks

https://www.ebay.com/itm/Heavy-Duty-18-x-72-x-74-Green-Epoxy-Wire-Storage-Shelf-Rack-Kit-Commercial/253297917065?

[ricknamer]

I just started setting up inside of a colo facility and am very happy.

I suggest going this route (although more expensive and less profitable) - it'll give you more time to work out the infrastructure behind 50-75 units.  In theory you can work  deal with your color to add them 1, 2 ,3 ,4 whatever number at a time until all 50 are in place.  Then when you're ready - move them at once.

https://i.imgur.com/MJ7rgdR.jpg


(Moderator's note: This post was edited by frodocooper to remove inline image tags.)

[.F.]

Nice setup! Out of curiosity, what's a standard rate for your colo? The lowest rate I found is $135/m/device but they want a year-long contract. That's no beuno...

[Raymond_B]

Nice setup! Out of curiosity, what's a standard rate for your colo? The lowest rate I found is $135/m/device but they want a year-long contract. That's no beuno...

First off listen to Phil

But I'd like to add my 2 cents.

Here's some steps you need to take 1st.

How much power can you get to that garage? Find that out now, not when you order miners.
Do you have any type of neighborhood association?
Do you have a sound ordnance?
Do you have neighbors that complain or will complain?

Let's say you get past all that, like Phil mentioned you need to work on heat removal not cooling addition. Read through this forum there's all kinds of tips and tricks. I've posted some, but there's so many other more experienced folks who have as well.

Finally ask yourself some technical questions. Do you know what DNS and DHCP are? Do you know what a staic IP is? Do you know why you should run 220v instead of 100v for these things? Do you know what the maximum continuous load on a 30A circuit should be?

I don't care if you know these things right now or not, BUT before spending a lot of your hard earned money you should find out.

That's probably more like 4 cents

[.F.]

Thank you thank you!

[mineintx]

Nice setup! Out of curiosity, what's a standard rate for your colo? The lowest rate I found is $135/m/device but they want a year-long contract. That's no beuno...

Have you found anywhere that will do it for $ 135 per month that is accepting new miners?     I been having an issue finding a colo that is open (and looks reputable).  

As for power.  My calculations are that a miner will cost (at 10 cents per KWH), around $ 100 per month in electricity.   I know everyone can get electric at 6 cents per KwH, check your bill.   Delivery fees, admin fees, and your "out the door costs" are likely at 10 cents per KwH.  

So if my electricity costs $ 100  per month, I think if I could find someone to deal with all the noise, cooling, etc, for $ 35.00 per unit, I would do it..

 - Also - Profit Calculations.   Best site I have found is

https://whattomine.com/asic

Each S9 as of today is bringing in approx $ 14.00 per day  in revenue.   Minus electricity costs ($ 3.00 per day), and making about $ 11.00 per day.


Remember, difficulty goes up all the time, each week my miners make slightly less bitcoin than the last week.    That trend will continue.

[Raymond_B]

Nice setup! Out of curiosity, what's a standard rate for your colo? The lowest rate I found is $135/m/device but they want a year-long contract. That's no beuno...

Have you found anywhere that will do it for $ 135 per month that is accepting new miners?     I been having an issue finding a colo that is open (and looks reputable).  

As for power.  My calculations are that a miner will cost (at 10 cents per KWH), around $ 100 per month in electricity.   I know everyone can get electric at 6 cents per KwH, check your bill.   Delivery fees, admin fees, and your "out the door costs" are likely at 10 cents per KwH.  

So if my electricity costs $ 100  per month, I think if I could find someone to deal with all the noise, cooling, etc, for $ 35.00 per unit, I would do it..

If you find someone hosting for $35.00 a month and .10 cents a kw/h you've found someone doing it at basically a loss. You have to think about all the things that go in to a *real* hosting facility. Bandwidth, virtual security, physical security, air handling equipment, electricity costs for lights, network gear, air handling equipment, the building, taxes, insurance, etc, etc. It's not trivial

Now if you find Fred the internet hero who says he can do it in his "building" I'd be very, very cautious.

[.F.]

Yeah - I found a place down in Tampa that will host them and service them for $135/month/device. Legit data center (https://www.synergyisp.com/)...I'd get badge access, can tour, VPN, etc.

It was just the year long lease they wanted otherwise I agree 100%. Maybe I can negotiate...

[Raymond_B]

Yeah - I found a place down in Tampa that will host them and service them for $135/month/device. Legit data center (https://www.synergyisp.com/)...I'd get badge access, can tour, VPN, etc.

It was just the year long lease they wanted otherwise I agree 100%. Maybe I can negotiate...

135 plus electricity right? Or that all in? The other poster said 35.00 which is crazy

[.F.]

Yeah - I found a place down in Tampa that will host them and service them for $135/month/device. Legit data center (https://www.synergyisp.com/)...I'd get badge access, can tour, VPN, etc.

It was just the year long lease they wanted otherwise I agree 100%. Maybe I can negotiate...

135 plus electricity right? Or that all in? The other poster said 35.00 which is crazy

It's 135 for everything (elec. + hosting services)

[Raymond_B]

Yeah - I found a place down in Tampa that will host them and service them for $135/month/device. Legit data center (https://www.synergyisp.com/)...I'd get badge access, can tour, VPN, etc.

It was just the year long lease they wanted otherwise I agree 100%. Maybe I can negotiate...

135 plus electricity right? Or that all in? The other poster said 35.00 which is crazy

It's 135 for everything (elec. + hosting services)

That's a damn good deal. Almost too good, I would definitely travel there and inspect the setup. Right now at .057 kw/hr not counting delivery fees etc I am at $57.46/month for one S9.

[Raymond_B]

So I looked at their website and I do not see anything for mining equipment. Do they fully understand what you're wanting to host? In my day job I work with some fairly large hosting providers, and most of them shy away from mining equipment. Mainly due to the HUGE power consumption and heat output. Servers aint got nothing on ASICs.

[.F.]

So I looked at their website and I do not see anything for mining equipment. Do they fully understand what you're wanting to host? In my day job I work with some fairly large hosting providers, and most of them shy away from mining equipment. Mainly due to the HUGE power consumption and heat output. Servers aint got nothing on ASICs.

Yeah, he knows what I want to do. He was even helping me decide between colo and self hosting. I had like a 30-minute conversation with the guy today on the phone - super nice. He's sending me the proposal tomorrow, so I'll know more then

And yes, I'll fly down too. It won't be twisting my arm to fly to Flordia in February :p

[Raymond_B]

So I looked at their website and I do not see anything for mining equipment. Do they fully understand what you're wanting to host? In my day job I work with some fairly large hosting providers, and most of them shy away from mining equipment. Mainly due to the HUGE power consumption and heat output. Servers aint got nothing on ASICs.

Yeah, he knows what I want to do. He was even helping me decide between colo and self hosting. I had like a 30-minute conversation with the guy today on the phone - super nice. He's sending me the proposal tomorrow, so I'll know more then

Then you're on to something.

[DPoS2]

So I looked at their website and I do not see anything for mining equipment. Do they fully understand what you're wanting to host? In my day job I work with some fairly large hosting providers, and most of them shy away from mining equipment. Mainly due to the HUGE power consumption and heat output. Servers aint got nothing on ASICs.

Most hosting datacenters ration out electric like they are their own utility company.. that is how they really make their $$$$..    They get that ultra cheap industrial rates and DO NOT let you milk as much as you can shove into a rack.   You will be lucky to fill half a rack before they tell you that you need to buy another rack for more power...  they will give a ton of reasons why but it is their profit maker so that is all you need to know..  They ain't going to have a furnace of heat coming out of a single rack that they have to cool since it effects the whole area of that datacenter's environment.

The problem most will have is any electric costs you save by getting a place with really cheap electric will nail you on rent, etc which eats it away.
If it was easy it wouldn't be for very long.. that is capitalism.  So you have to hunt out a space that has great potential to double dip..  the space used for a mechanic and the electric used for mining..  or something similar.  Perhaps someone who wants all that heat for whatever they are doing and join forces with them.

Or you go full baller venture cap mode and just spend everyone else's money to build it and well..  you can paint the rest of that picture or read history on many other instances of that.  Zen Miner anyone?

https://btcmanager.com/ponzi-schemes-gaw-miners-zenminer-fined-10-million-each/

[.F.]

So I looked at their website and I do not see anything for mining equipment. Do they fully understand what you're wanting to host? In my day job I work with some fairly large hosting providers, and most of them shy away from mining equipment. Mainly due to the HUGE power consumption and heat output. Servers aint got nothing on ASICs.

Most hosting datacenters ration out electric like they are their own utility company.. that is how they really make their $$$$..    They get that ultra cheap industrial rates and DO NOT let you milk as much as you can shove into a rack.   You will be lucky to fill half a rack before they tell you that you need to buy another rack for more power...  they will give a ton of reasons why but it is their profit maker so that is all you need to know..  They ain't going to have a furnace of heat coming out of a single rack that they have to cool since it effects the whole area of that datacenter's environment.

The problem most will have is any electric costs you save by getting a place with really cheap electric will nail you on rent, etc which eats it away.
If it was easy it wouldn't be for very long.. that is capitalism.  So you have to hunt out a space that has great potential to double dip..  the space used for a mechanic and the electric used for mining..  or something similar.  Perhaps someone who wants all that heat for whatever they are doing and join forces with them.

Or you go full baller venture cap mode and just spend everyone else's money to build it and well..  you can paint the rest of that picture or read history on many other instances of that.  Zen Miner anyone?

https://btcmanager.com/ponzi-schemes-gaw-miners-zenminer-fined-10-million-each

This guy is giving me capacity up to 75 at that rate, and anything after that I'd probably move out on my own anyway.

I'm in VC, so I'm all about using outside capital. Us fund managers do it too :p  

ALSO...is it true people are only making $11 / day off an S9? Why do I see posts of people making $20+?

[Flying Hellfish]

ALSO...is it true people are only making $11 / day off an S9? Why do I see posts of people making $20+?

Because difficulty...

At todays diff with $0.10 elec and 2% pool fees, net profit is estimated somewhere south of $10 a day according to coinwarz.

There was a time when they made $20 a day when difficulty was lower.  If you are getting older info it may have been accurate at the time but not now.

You do understand there is a really strong likely hood diff will continue to increase for quite some time to come right?  You don't seem to grasp the relationship between diff and revenue generated.