Why Host Your Bitcoin Mining Server at at Colocation Data Center?

A common question we are asked all the time, is "Why would I host my server at a data center, and not at my house, or my office?". The Short Answer: Scalability.

While it is initially cost effective to keep mining servers in a residential or small commercial setting, the saving's quickly diminish as the mining operation scales up. There are many costs that are often ignored when a Bitcoin Mining operation starts up. While nearly everybody is immediately aware of the electrical costs involved in the endeavor, hidden costs quickly add up. These include:

Electrical Infrastructure Costs: Typical new construction provides for a code allowable wattage consumption of 38,400 watts. This is 34 Antminer S1's or 20 Cointerra Terraminers. This power figure negates electricity needed to actually live or work at the location, and it negates cooling costs. Installing approximately 20 x 20amp electrical outlets also costs money.

Cooling Infrastructure Costs: It will take approximately 40% of the electrical consumption used by a miner to cool the space it is in, if mechanical cooling is necessary. This leaves only 23,040 watts available for actual mining power, and it also adds 40% to the cost of the net electricity used for the operation. With the national average of $0.12 per KWh, that brings the total to $0.16 per Kwh with cooling costs involved. Also, a net consumption of 23 Kw will require about 6.5 additional tons of cooling. Most large houses have about 6 tons for comfort cooling, this will mean a total of 12 tons of cooling necessary. Installing this additional air conditioner costs money.

Long Term opportunity costs: With the increasing Bitcoin Difficulty, one must take into account whether the costs of installing 20 x 20amp plugs, and 6 additional tons of air conditioner will make a good long term investment.

When it comes to crypto currency and mining for coins, the old adage of "time is money" holds true more than ever. This needs to be in the forefront of your thought process when deciding how you will go about this process. Make sure you choose a data center that will understand how valuable your uptime is!

In the end, a true data center will have not only battery backup, but a secondary power source, such as a generator. They'll also have network redundancy. These are 2 more things that will prove to be valuable to your experience.

Save yourself the worries of power consumption, electrical consumption and the fear of downtime for your equipment. Colocate your equipment and start earning your coins!