[2018-06-07] CCN: $700 Million Bitcoin Mining Farm Coming to Upstate New York

[BitcoinArsenal]

Coinmint plans to invest up to $700 million in the project, which will create an estimated 150 jobs over the next 18 months. The new center is expected to be fully operational within the next 12 months, the company projected in a statement. Full article on CCN

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[Harlot]

The move is reasonable if Coinmit expected to cut expenses from taking advantage of Massena, New York's renewable source then it is a good decision for them, they can expect that even though cryptocurrency prices are down their will still be a profit to be made as electricity bills are expected to be lower. Plus a 700 million dollar move says that they expect to create a big money out of it. The local government of Massena is in full support and is ready to help with anything as it will create jobs for their residents.

[Betwrong]

They say that New York is neither company friendly nor energy friendly, but I'm sure their business will be profitable eventually. It's not so hard to predict that Bitcoin price will be at least 3 times higher than it is now within a year and if they are going to hold their mined coins until then they'll be okay. They say that in Southeast Asia the electricity is much cheaper than in NY, but in reality miners face power interruptions so frequently down there so that mining business becomes a disaster for them and they regret their decision to open it there. I wish Coinmint all the best in their intention to become the world’s largest bitcoin mining center. Investing $700 million in Bitcoin mining is a tough decision to make and I respect them for that.

[stompix]

They say that New York is neither company friendly nor energy friendly, but I'm sure their business will be profitable eventually.

When you talk about the state of NY, things differ a lot depending on the location.
Massena has a price of just 3 cents per kw for residential customers so it might be possible they offer 2 cents for business or even less.
With an aluminum smelter gone, and that is one of the few industries that are more energy-hungry than bitcoin mining, they are left probably with a lot of spare capacity.

But still, 180 jobs...I kind'of doubt that number.
Even with the minimum wage, they are going to spend 4 million on wages alone a year.
And you can't pay technicians in NY with 10$/hours.

[vit05]

They say that New York is neither company friendly nor energy friendly, but I'm sure their business will be profitable eventually.

When you talk about the state of NY, things differ a lot depending on the location.
Massena has a price of just 3 cents per kw for residential customers so it might be possible they offer 2 cents for business or even less.
With an aluminum smelter gone, and that is one of the few industries that are more energy-hungry than bitcoin mining, they are left probably with a lot of spare capacity.

But still, 180 jobs...I kind'of doubt that number.
Even with the minimum wage, they are going to spend 4 million on wages alone a year.
And you can't pay technicians in NY with 10$/hours.

I did not expect the cost of electricity to be so small there. Very interesting to know. And this logic of finding cities that have lost a recent aluminum factory may be an excellent strategy for Bitcoin farms.

I just do not understand why they need so many employees. I think they claim this to make it easier for the government to accept.

[richardsNY]

I just do not understand why they need so many employees. I think they claim this to make it easier for the government to accept.

That. It's very important for you as a miner to promote yourself in the best possible way, especially so with how miners are seen as power hungry entities only bumping up the price of local resources. If you can make it look like you employ whatever number of people, and thus do something good for the local community, you already scored a few points there. I however doubt that the good initial promises will be maintained for long. Employees add additional cost, so I think that after a few months the majority of these employees will likely be dumped one way or another....

[milewilda]

I just do not understand why they need so many employees. I think they claim this to make it easier for the government to accept.

That. It's very important for you as a miner to promote yourself in the best possible way, especially so with how miners are seen as power hungry entities only bumping up the price of local resources. If you can make it look like you employ whatever number of people, and thus do something good for the local community, you already scored a few points there. I however doubt that the good initial promises will be maintained for long. Employees add additional cost, so I think that after a few months the majority of these employees will likely be dumped one way or another....

It wouldnt sustain for long or forever. Sooner or later they would really feel the pain when it comes to expenses considering 180 employees wont really be a joke amount. You might get the positive views on what you have done but you would really able to sacrifice money with that and i do see they wont choose up this option to remain. Same as you said few months later these employees would be dumped and come to think maintaining a mining farm doesnt really require too much personnel.

[Betwrong]

They say that New York is neither company friendly nor energy friendly, but I'm sure their business will be profitable eventually.

When you talk about the state of NY, things differ a lot depending on the location.
Massena has a price of just 3 cents per kw for residential customers so it might be possible they offer 2 cents for business or even less.

As far as I know in most countries when you buy electricity it is the opposite situation to buying goods regarding payment. When you buy goods in bulk you get a discounted price, while when you buy electricity in bigger amounts you pay more for kWh compared to regular retail price. Is the situation different in NY? I really doubt that but maybe I'm missing something.

But still, 180 jobs...I kind'of doubt that number.
Even with the minimum wage, they are going to spend 4 million on wages alone a year.
And you can't pay technicians in NY with 10$/hours.

Regarding 180 jobs I think they take into account construction workers who surely will not be working a whole year there, but rather around a month or two max.

[Kakmakr]

It is very interesting that companies are stilling keen on investing in areas where we had strong resistance against Crypto currencies in the past. Take the BitLicense as an example, it pushed companies to relocate to more Bitcoin friendly states and a lot of innovative companies had to close their doors. 

I am very surprised that more and more mining farms are shooting up with the Bitcoin difficulty at the high it is now. How long can this still be profitable or are they more invested in mining other Crypto currencies? 

[stompix]

I just do not understand why they need so many employees. I think they claim this to make it easier for the government to accept.

That. It's very important for you as a miner to promote yourself in the best possible way, especially so with how miners are seen as power hungry entities only bumping up the price of local resources. If you can make it look like you employ whatever number of people, and thus do something good for the local community, you already scored a few points there. I however doubt that the good initial promises will be maintained for long. Employees add additional cost, so I think that after a few months the majority of these employees will likely be dumped one way or another....

I just remembered an episode of John Oliver about this:
https://www.youtube.com/watch?v=8bl19RoR7lc

How sometimes states offer so much incentive to some companies in forms of tax cuts that sometimes they end worse than if they would have paid the new workers directly from state funds.

Ps.
I don't agree with J.O. views, as he is a bit too much of a leftist for me but in this case, he is damn right.

They say that New York is neither company friendly nor energy friendly, but I'm sure their business will be profitable eventually.

When you talk about the state of NY, things differ a lot depending on the location.
Massena has a price of just 3 cents per kw for residential customers so it might be possible they offer 2 cents for business or even less.

As far as I know in most countries when you buy electricity it is the opposite situation to buying goods regarding payment. When you buy goods in bulk you get a discounted price, while when you buy electricity in bigger amounts you pay more for kWh compared to regular retail price. Is the situation different in NY? I really doubt that but maybe I'm missing something.

It depends a lot on how that energy is generated and how much you have available.

In case you have an extra 5MW nuclear available and your client needs only 100 out of the 700 a new turn on reactor would produce the price is going to be higher.
Because you end up with another batch of  605 MW you need to sell...

But if you have a dam, you have an extra of 200MW available and there comes a client that wants to buy it all, then you are going to give it to him for almost free as that is lost revenue at the moment.


 

[TheQuin]

Regarding 180 jobs I think they take into account construction workers who surely will not be working a whole year there, but rather around a month or two max.

The article says "an estimated 150 jobs over the next 18 months" so I'd take that to mean mainly construction workers. Then it says "The plant will be staffed 24 hours a day, seven days a week, 365 days a year by security personnel, IT technicians, electricians, and operational staff." so probably 20 to 30 permanent positions after that.

[BitHodler]

But if you have a dam, you have an extra of 200MW available and there comes a client that wants to buy it all, then you are going to give it to him for almost free as that is lost revenue at the moment.

If governments stopped being utter hypocrites, and acknowledge how damaging losses of unused power are on a global scale, they would be happy with how Bitcoin avoids billions worth of energy waste every year.

Miners would glady consume energy waste, especially if it's priced way below regular rates. It's either losing money on this energy waste or making a decent buck out of it. I would definitely know what to do in that case.

It would be extremely funny but also interesting when power suppliers start up their own mining farms. What other profitable way is there to follow if they don't pass it to miners? Energy waste becomes big business.

[Betwrong]

But if you have a dam, you have an extra of 200MW available and there comes a client that wants to buy it all, then you are going to give it to him for almost free as that is lost revenue at the moment.

If governments stopped being utter hypocrites, and acknowledge how damaging losses of unused power are on a global scale, they would be happy with how Bitcoin avoids billions worth of energy waste every year.

Miners would glady consume energy waste, especially if it's priced way below regular rates. It's either losing money on this energy waste or making a decent buck out of it. I would definitely know what to do in that case.

It would be extremely funny but also interesting when power suppliers start up their own mining farms. What other profitable way is there to follow if they don't pass it to miners? Energy waste becomes big business.

This is only possible in the areas where the energy supply completely satisfies the demand for it. I think most areas are short of energy and there is no such thing as unused power there. That's why miners who build their farms in South East Asia can't operate properly because of constant power outages. Btw do you know how much of unused power in the world is wasted, say, monthly? Because I think it's not much actually. As far as I know they adjust the production of power accordingly to demand in the areas where overproduction can happen.

[BitHodler]

Btw do you know how much of unused power in the world is wasted, say, monthly? Because I think it's not much actually. As far as I know they adjust the production of power accordingly to demand in the areas where overproduction can happen.

It's impossible to exactly figure out since we depend on third party information sources, only because energy suppliers won't ever want to be associated with this form of environmental 'destruction', as some people like to call it.

There are several aspects of energy waste that are being calculated, but if you Google energy waste, some articles point out that there is more energy waste in the world than usage. If this is real, then it's pretty shocking.

If we purely focus on energy suppliers, then it's probably safe to say that at least 10% of the energy is wasted before it even reaches its destination. That alone is a pretty significant percentage already.

Don't forget that our electronic hardware at home is wasting energy as well, even when they are turned off.

[stompix]

But if you have a dam, you have an extra of 200MW available and there comes a client that wants to buy it all, then you are going to give it to him for almost free as that is lost revenue at the moment.

If governments stopped being utter hypocrites, and acknowledge how damaging losses of unused power are on a global scale, they would be happy with how Bitcoin avoids billions worth of energy waste every year.

Most of the unused power or space capacity is there because you can't produce the exact amount of energy needed, nor can you turn on nuclear reactors or even gas power plants in a matter of seconds.

Pretty ironic is the fact that most of this waste energy is caused by the so-called "green energy" which has the habit of being totally unreliable so every time you need to have an alternative up and ready to supplement power. Furthermore, and to add to the stupidity of the whole thing, most of that spare capacity that is held in standby usually comes from hydropower, as it's the cheapest for this job.

As for miners consuming waste energy, that's close to impossible as the fluctuations will render bitcoin mining really vulnerable both to attacks as huge farms go down and to huge delays in block confirmations from the same reason.

There are several aspects of energy waste that are being calculated, but if you Google energy waste, some articles point out that there is more energy waste in the world than usage. If this is real, then it's pretty shocking.

There is no definition of real waste.
If you ask a treehugger what waste is, just by unlocking your smartphone to look at what day it is you waste energy you could have easily memorated that and from this kind of attitude there are some dumb statistics out there where people waste millions of kw because they forget to turn off the tv or are using the AC one degree more than required.
F that, if I'm going to live my life acting like a squirrel all day conserving and preventing energy waste I don't want to live on this planet anymore.


 

[Diabolov]

New York??? not sure how they plan to have long term sustainability. NY State, outside of CA, has some of the worst company taxes and restrictions. Perhaps they can get State subsidies or favorable Tax arrangement from the State for opening a New company but long term NY is going to eat them alive. Compare this to China and other Asian Countries that will not only offer nearly free Electricity but will subsidize heavily these mining upstarts, of course the downside is these Countries will permanently own part, if not all, of your company.

Wish them all the best but NY is neither company friendly nor energy friendly. My guess is they will either have to shut down or move within 5 years, especially if they do well, due to NY coming up with a new "Crypto Mining Tax" in order to help fund the bankrupt NY Gov.