$2 million+ bitcoin mining facility launched in Iceland

[coins101]

They'll barely get a ROI given that the difficulty will soon rise again. Would have been better to just buy $2 million of coins from an investor.

That's fairly narrow minded.  Diff increases, but so does something else.  Think hard enough and it might come to you.

I am going to guess network hash rate? 

I guess he means price. That was hard work, should have put an ice pack on my head while thinking about it.

My 2 cents worth - Difficulty increases, but so does something else - the fully diverse p2p nature of the system.

Of course I was being a bit sarcastic.

I'm wondering what you mean by the fully diverse p20 nature of the system.  Adoption?

I just keep thinking that the higher the efficiency, the power and cost of every new generation of equipment, the fewer miners will be out there because they can't compete. This seems like we will soon know where the Bitcoin mining hubs are - 15% of the network is expected to be in one place in Iceland according to this report. Others my follow.

When you know where the majority of the hubs are, you stop having a true p2p system and instead you have something where governments can go and unplug the network. That would be ok if there are enough networked pc's out there to take over, but what if the majority switch off their machines, sell their equipment, etc?

I'm not an expert in these things - I just think it looks a risk factor for the future stability and prosperity of the currency.

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[Kryptox]

They'll barely get a ROI given that the difficulty will soon rise again. Would have been better to just buy $2 million of coins from an investor.

That's fairly narrow minded.  Diff increases, but so does something else.  Think hard enough and it might come to you.

I am going to guess network hash rate? 

I guess he means price. That was hard work, should have put an ice pack on my head while thinking about it.

My 2 cents worth - Difficulty increases, but so does something else - the fully diverse p2p nature of the system.

Of course I was being a bit sarcastic.

I'm wondering what you mean by the fully diverse p20 nature of the system.  Adoption?

I just keep thinking that the higher the efficiency, the power and cost of every new generation of equipment, the fewer miners will be out there because they can't compete. This seems like we will soon know where the Bitcoin mining hubs are - 15% of the network is expected to be in one place in Iceland according to this report. Others my follow.

When you know where the majority of the hubs are, you stop having a true p2p system and instead you have something where governments can go and unplug the network. That would be ok if there are enough networked pc's out there to take over, but what if the majority switch off their machines, sell their equipment, etc?

I'm not an expert in these things - I just think it looks a risk factor for the future stability and prosperity of the currency.

You have a point.  The transition to ASIC's scared me just for this reason.  Bitcoin is going through a period where security has declined substantially since the days of purely GPU mining.  It's changing though and I feel that it will diversify further, just give it some time.

If Bitcoin survives this, it's only going to strengthen it in the long run.

[max.]

Have you think about why Google, Facebook, or Apple are not interested in mining bitcoins? They have the biggest data centers in the world.

For them it would be too easy and with the big resources they have they could control bitcoin in only some months.


They don't care because they don't see a value in bitcoin.

[LiteCoinGuy]

crazy. saw a similar building in asia. thats the next step in mining but far away from what we will see in 1-2 years.

[jonanon]

Looks cool but I wish I were reading about a start-up business accepting BTC as a means of accepting payment. I think one of Bitcoins flaws is the way mining rewards huge investment!

[BrandonQ1995]

If only I were so rich as to invest in such hardware...
But it might've been better to just buy 2 million dollars worth of Bitcoins, especially with the difficulty only to get higher and higher in time.

[User705]

That's cloud hashing.  Just do a search in scam boards here to see where he got the investomers for that mine.  Needless to say he definitely made money.  Others not so much.

[johnyj]

Noooooo, they will melt the icebergs near north pole and cause sea floor to raise and flood major cities along seashore  

BTW, I don't think any Jupiter can make back the bitcoin invested at current difficulty rising speed

[ohiofarmer]

Interesting. Thank you, nice find!

Estimate 600 GH/s for B1 Jupiters and we're talking about 60 TH/s in KnC hardware for 100 units.

Our co-op only has about 8 TH/s online at the moment, with 4 Jupiters online as part of that hashrate. Interesting to note that our tiny co-op of only 4 team leaders that are working this co-op part-time, has 74 TH/s on order with Black Arrow Prosperos alone, at a fraction of this $2MM, albeit in late February.

That's very interesting that he brought up points that has already affected our future planning for our third miner hosting facility which is likely going to be located next to a major river somewhere for power/cooling. I'm guessing that mining power will necessarily evolve to pockets of:

- friendly BTC/ALT stance by govt.
- friendly business stance by govt.
- super cheap electricity
- ample water (which is another one of the 21st century's forms of "Gold") and or frigid conditions

He has a head start on us, but we are catching up with about 92TH/s of nominal hashrate on order so far, because our prices beat the pants off of Cloud Hashing prices.

Then again: as the co-op founder, I'm a bit biased in the matter.  

This hashrate number doesn't include the miners being hosted or to be hosted with my business partner at Miner Hosting LLC, bobsag3, who is also one of our co-op leaders.

Disclaimer: I am his direct competition and instead of being former bankers that helped wreck the world economy, I/we are essentially GB forum vets that banded together to TCB and take care of customers together (apologies if you're a reformed world economy destroying banker).  

Are you taking investors?

[Eri]

They'll barely get a ROI given that the difficulty will soon rise again. Would have been better to just buy $2 million of coins from an investor.

That's fairly narrow minded.  Diff increases, but so does something else.  Think hard enough and it might come to you.

I am going to guess network hash rate? 

I guess he means price. That was hard work, should have put an ice pack on my head while thinking about it.

My 2 cents worth - Difficulty increases, but so does something else - the fully diverse p2p nature of the system.

Of course I was being a bit sarcastic.

I'm wondering what you mean by the fully diverse p20 nature of the system.  Adoption?

I just keep thinking that the higher the efficiency, the power and cost of every new generation of equipment, the fewer miners will be out there because they can't compete. This seems like we will soon know where the Bitcoin mining hubs are - 15% of the network is expected to be in one place in Iceland according to this report. Others my follow.

When you know where the majority of the hubs are, you stop having a true p2p system and instead you have something where governments can go and unplug the network. That would be ok if there are enough networked pc's out there to take over, but what if the majority switch off their machines, sell their equipment, etc?

I'm not an expert in these things - I just think it looks a risk factor for the future stability and prosperity of the currency.

You have a point.  The transition to ASIC's scared me just for this reason.  Bitcoin is going through a period where security has declined substantially since the days of purely GPU mining.  It's changing though and I feel that it will diversify further, just give it some time.

If Bitcoin survives this, it's only going to strengthen it in the long run.

I think we more or less had a false sense of security because nobody had developed it yet and bitcoin wasnt really big enough for anyone to care. if anyone had developed the most crappy of crappy ASICs possible they could have dwarfed the network at the time(same for cpu->gpu). the fact we have people developing, building and releasing ASICs now means were gearing up towards the limit of technology. Even if some major force released a ton of advanced ASICs. if the current developers wanted to keep making money they would be forced to drop price and produce more advanced stuff. i think we could easily fend off most attacks on the system, even if it were a govt trying it. Worst case... i think these ASIC developers could sell them nearly at cost if it meant 'letting bitcoin die and losing its value or getting ASICs into more peoples hands so it survivies'. our devs are pretty smart too, and there are also allot of big investors in bitcoin now as well. im not sure they would be so willing to let it slip away.

[eyjgvfdhbshm]

It's just waiting for a quantum computer that will render all mining farms useless and that will mine every bitcoin left in a small amount of time.

[Eri]

It's just waiting for a quantum computer that will render all mining farms useless and that will mine every bitcoin left in a small amount of time.

not possible. never mind the fact that tech is light years away. every 2016 blocks(roughly 2 weeks) the difficulty is adjusted. so even if they had 99% of the hashrate the network would adjust in short order and put the average back at 10 minutes.

[Gabi]

It's just waiting for a quantum computer that will render all mining farms useless and that will mine every bitcoin left in a small amount of time.

>switch to another algorithm not quantum-vulnerable
>problem solved

[exahash]

This is pretty insane...

This is insane for a different reason.

Can anyone think of why such an article is a bad idea in light of current events? 

Anyone?

Anyone?

Bueller?

How about this... isolated data center in tiny country responsible for 15% of world's BTC identified to world's SIGINT organizations (China, NSA, GCHC, etc).  Doesn't have to be that "the NSA is against bitcoin" - it only has to be a faction of one (possibly corrupt) organization with the ability to intercept and mangle communications and this guys in a world of hurt.

Mining installations greater than 1% of the network need to be secret.

[davedx]

It is indeed something to consider. If the world's BTC mining consolidates into the control of a handful of people, we might see a sad loss of the democratic network.

People claim nobody with 51% will do double spends as it will devalue the currency. Are we so sure?

Is the future of BTC mining cartels like OPEC? What effect will this have on the BTC economy?

(I say this as a proud member of the DZ Coop...)

[iluvpie60]

This is pretty insane: thanks to some outside investors, a former HSBC programmer has dumped more than $2 million (100 computers at $20K a pop) into a custom-built bitcoin-mining facility in Iceland. Energy's cheap there, and the cool climate's used to keep the equipment from overheating. To get into the windowless facility, you have to go past a fortified gate, a guard behind bulletproof glass, then through a "man trap."

"Last Wednesday ... the entire operation unlocked 225 Bitcoins, valued at around $160,000 at recent prices." Not bad! The full story is here:

http://dealbook.nytimes.com/2013/12/21/into-the-bitcoin-mines/

pretty sweet sounding.

[ninjafocus100]

Have you think about why Google, Facebook, or Apple are not interested in mining bitcoins? They have the biggest data centers in the world.

For them it would be too easy and with the big resources they have they could control bitcoin in only some months.


They don't care because they don't see a value in bitcoin.

There is no Bitcoin DNA in those companies. They only focus on what they are good at. I believe when Bitcoin market matures, they will know how to make use or Bitcoin. May be accept it as a payment. Give it a few years.

[jaked]

It's just waiting for a quantum computer that will render all mining farms useless and that will mine every bitcoin left in a small amount of time.

Bitcoin is resilient to quantum computing.
And quantum computing is currently an unproven fantasy anyway.

[Bitcoinpro]

They'll barely get a ROI given that the difficulty will soon rise again. Would have been better to just buy $2 million of coins from an investor.

i agree

[mog]

I've been speaking with a few DC operators here in Iceland. Datacell (the same company that sued VISA over wikileaks payment processing) had this announcement today.
https://www.datacell.com/news/special-offers-for-bitcoin-miners/