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Densities of Bitcoin Mining Data Centers to Consider

Densities of Bitcoin Mining Data Centers to Consider

by Sarah Pereau | 13 Dec 2017

Bitcoin is a scarce digital cryptocurrency that has become incredibly popular in recent days.

On December 11, 2017, Bitcoin’s 24-hour high was a value of $17,377.91. The value of Bitcoin lies in the fact that it is the only form of currency in the world which has “no counter-party risk to hold and to transfer” – it is entirely unregulated, giving you full control of the money with no risk of confiscation.

There is a limited amount of Bitcoin – 21 million. According to Erik Voorhees, co-founder of Coinapult and founder of (both Bitcoin companies), “those who contribute computing power to secure the network” are given Bitcoin. Thus, the more computing power you can provide, the higher the chances are of you getting new Bitcoin. This process is called “mining.” The computing power required for Bitcoin mining is extremely complex. Mining computers were once housed in household basements. Now, mining hardware is set up in Bitcoin mining data centers around the world, each with different densities. It makes sense for mining operations to be in a data center – few IT specialists are needed to oversee massive amounts of hardware for maintenance.

In Boden, Sweden, a company called KnC Miner has built a couple of high-density, 10-megawatt Bitcoin mining data centers designed specifically for cryptocurrency mining. KnC Miner “sells” the hardware to customers interesting in mining. Other companies such as Rocky Mountain Miners, lease space from data center providers such as Latisys, to “colocate portions of the data centers for cryptocurrency mining operations.”

Infrastructure companies have begun competing and leasing space to those interested in cryptocurrency mining. However, customers using standard data centers for mining could see an increase in monthly costs for electricity usage and hardware cooling compared to those mining in an industrial data center designed specifically for cryptocurrency mining. Alex Kempel, VP of Engineering at Allied Control, does not believe that “traditional data centers are ready for the capacity required for cryptocurrency mining.”

KnC Miner’s megawatt facility in Sweden houses enough GPU hardware and cooling hardware needed to host and support cryptocurrency mining. There is plenty of innovation in cryptocurrency mining. However, well established IT companies who already have data centers, still may not currently have the density requirements necessary to meet “the low end of Bitcoin densities.”

Bitmain, the industry’s second-largest company specializing in mining hardware, currently “controls 18.6 percent of the Bitcoin network’s hash power.” Along with Chinese investors, Bitmain will be building the world’s third-largest cryptocurrency data center.

While KnC Miner has an impressive 10-megawatt data center, Bitmain plans to build an astonishing 135-megawatt Bitcoin mining data centers for cryptocurrency mining.

The higher the density of the hardware, the more cryptocurrency mining operations a data center can host. The more Bitcoin mining data centers can host, the higher the profit for both the company leasing the hardware and the company colocating the space for mining operations.

GeoTel is the leading provider of telecommunications infrastructure data, including data center locations necessary for Bitcoin mining and other cryptocurrency mining. For over sixteen years, GeoTel’s products have been providing companies and government entities with the leverage and insight necessary to make intelligent, location-based business decisions. For more information, please contact our experts at (407) 788-8888.

Valerie Stephen