Giant Chinese Bitcoin Mines Are the Foundation of the Next Economy

The digital currency Bitcoin has fluctuated in value, but it seems unlikely to go away in the immediate future. And part of its ongoing strength depends on Bitcoin farms, where virtual value is mined in enormous factories

Writing for the Coinsmith, a Bitcoin news site, a writer named Bitsmith describes a trip he took to a Chinese Bitcoin farm. Housed in an abandoned factory, it's run by three men who live in the facility six nights a week, sleeping and playing games in between servicing thousands of machines. Piles of burned-out machines are heaped in the corner, and banks of enormous fans keep the place cooled down as the chipboards grind through the algorithms that produce new Bitcoins.


Bitsmith writes:

The first thing you notice as you approach the warehouse is the noise. It begins as soon as you step out of the car, at which point it sounds like massive swarm of angry bees droning away somewhere off in the distance. It becomes louder and louder the closer you get to the building, and as you step through the doors it becomes a deafening and steady roar; a combination of tens of thousands of tiny ASIC chips hashing away, and dozens of large industrial fans serving to cool down the "workers" ...

The next thing that hits you as you enter is the wind. The deeper into the building I walked, the more powerful the gust became, coming from behind me and rushing past, across the giant warehouse floor full of machines ...

The mining operation resides on an old, repurposed factory floor, and contains 2500 machines hashing away at 230 Gh/s, each. (That's 230 billion calculations per second, per unit) ...

Bitsmith concludes:

Walking around the warehouse floor, I was struck with a feeling of awe that THIS is what keeps bitcoin alive. That even if someone wanted to bring down bitcoin, they'd have to outdo these guys and the dozens of other operations like this around the world. The decentralized nature of it all… that this is just one operation among many, run by different operators in different countries around the world. This really drove home that bitcoin can't be killed by decree. Make it illegal in one country and people like this will keep hashing away in others.


This is the very real, very expensive, and very environmentally unsustainable reality behind a virtual currency hailed as the future of money. We haven't escaped from industrial age mines. We've merely reinvented them.


Read the rest of the story, and see an incredible gallery of images, over at The Coinsman.

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