20 July 2021
CD31: getting started with bitcoin mining with @diverter_nokyc, @econoalchemist, and @roninminer
EPISODE: 0.3.1
BLOCK: 691887
PRICE: 3373 sats per dollar
TOPICS: getting started with bitcoin mining, power, heat, noise, being good to your wife, internet, renting failed subway sandwich locations for mining, hosted mining options and tradeoffs, cloud mining is bad, mining shitcoins and dumping them for bitcoin
@diverter_nokyc: https://twitter.com/diverter_nokyc
@econoalchemist: https://twitter.com/econoalchemist
@roninminer: https://twitter.com/roninminer
I. Introduction/Why Mine Bitcoin at Home?
II. Acquiring a Miner [53:18]
III. Setting up Power/Infrastructure [1:06:36]
IV. Solving Wi-Fi [1:21:15]
V. Dealing with Noise [1:23:58]
VI. Dealing with Heat [1:29:01]
VII. Immersion Mining at Home [1:32:16]
VIII. Price Per Terahash [1:34:32]
IX. Extra Benefits of Mining at a Small Scale [1:36:57]
X. Two Different Types of Immersion [1:40:40]
XI. Mining Pools [1:45:48]
XII. Unsustainable Fee Market in the Future? [2:05:00]
XIII. Hosted Mining Services [2:12:24]
XIV. Mining Shitcoins for Bitcoin [2:34:45]
XV. Profitability [2:42:03]
Full Transcript: https://chowcollection.medium.com/matt-odell-citadel-dispatch-e31-getting-started-with-bitcoin-mining-with-diverter-nokyc-63513757f709
diverter's guide: https://diverter.hostyourown.tools/mining-for-the-streets/
econoalchemist guide: https://www.econoalchemist.com/post/home-mining-for-non-kyc-bitcoin
laurentia pool: https://laurentiapool.org/
support dispatch: https://citadeldispatch.com/contribute
twitch: https://twitch.tv/citadeldispatch
youtube: https://www.youtube.com/channel/UCoA72saVAuQ8hYCnBO0Lymw
bitcointv: https://bitcointv.com/video-channels/citadeldispatch/videos
podcast: https://www.podpage.com/citadeldispatch
telegram: https://t.me/citadeldispatch
stream sats to the show: https://www.fountain.fm/
join the chat: https://matrix.to/#/#citadel:bitcoin.kyoto
[00:00:00]
Unknown:
There's our indicated up. Dow futures up by about a 123 points right now, but they were up by more than a 100 points more, just a little while ago. We were looking at the Dow up by about 200 and 25. S and P futures up by 14, the Nasdaq up by about 53, and then the treasury market is really something to behold at this point. Earlier this morning, the 10 year was just at, 1.2%. In fact, it's fallen below that to 1.17%. That's kind of unbelievable to watch this pressure on yields continue. 30 years at 1.8%, 2 years at 0.206, And the price of Bitcoin fell below 30,000 for the first time since June 22nd. About $98,000,000,000 was wiped off the entire crypto market just in 24 hours. This morning, Bitcoin at 29441.
Ether's down about 4.6 percent to 1735. Pressure across the board though with declines of more than 7% for Litecoin, for Ripple, for Dogecoin, and the energy market too. This was something to watch. There's a little bit of a bounce back this morning for WTI, but yesterday was the biggest decline we've seen for the oil market's worst day since September and the lowest level in 2 months at $66.84 a barrel.
[00:01:10] Unknown:
Got some other big losers to talk about as well yesterday. Energy stocks tumbling after the price of oil fell by as much as 8%. Crew stocks each down, between about 4 6% yesterday, adding some dramatic losses for the month of July so far, but those stocks regaining some ground this morning. Take a look at where things, stand. You're you're looking at, a little bit of a a rebound there. Airline stocks also punished yesterday as well. Those stocks, rebounding again, this morning. You can take a a look at, where some of those stand, Royal Caribbean, looking like it's up about 3 a half percent, and some of the airlines as well, off, but, but pushing forward this morning. Those stocks, as I said, rebounding before. As stocks plunged yesterday, investors betting on a familiar category that could grow if COVID cases continue to rise, and that's grocery stores. Shares of Kroger and Albertsons jumped. Costco touching an all time high. Other pandemic plays were higher, including Clorox.
And, yes, Peloton is making the trade back.
[00:02:11] Unknown:
Kroger up by 5.7%.
[00:02:12] Unknown:
Think that's your you think I thought everybody was either bought their Peloton or not by now. You really think this is gonna happen this way? Did you hoard any of this last time? I saw it.
[00:02:24] Unknown:
Because I shouldn't say this. It's on every table around here Yep. NASDAQ. And there were a couple of times where I might have said, look. I I might have taken one of those home. Are you kidding me? You shouldn't Well, you couldn't get them. You couldn't get You couldn't get them. You couldn't get them anywhere. Did you steal the toilet paper that happened to? I I would just wrap a lot around my my hands, walk out without anyone noticing. No. I didn't do that. But now here's my here's okay. Did you guys read the journal today? I want I want everyone to read this. It's, we'll always have COVID, but it's gonna be manageable according to the journal, even the delta variant since hospitalization is so so rare even if it it it's fairly effective, the vaccines are, and we'll develop new vaccines against it. But we should get used to it, but it probably won't cause the the same type of disruption that that the first two surges I I don't think there is You know is not shutdown.
Yeah. But you know who's not listening? The 10 year. Yeah. And the 10 year was ahead of this. Right. Because we did talk we knew about the d word, the delta word 2 weeks ago, 3 weeks ago, 4 weeks ago. That's what's been pressuring it the whole time. I don't know. I think Actually, investors the consequences of the slow of the slowdown of it not being as robust or or or reopening being delayed somewhat, I think was what what else would account for the 16th to 11?
[00:03:39] Unknown:
The the only thing that I can think with that is it was somebody hedging their bets. Somebody who thinks it's going to be a strong opening, a strong economy, maybe you hedge your bet by by taking the other side of it in the treasury market. Because I can't imagine that that there are investors who saw this,
[00:03:54] Unknown:
you know, 3, 4 weeks ago and thought, okay. This is what's going to happen. Seeing the packed stadiums and the 80 you know, the greatest earnings we've ever had, all those things, none of that accounts for the 10 year.
[00:04:07] Unknown:
No. You're
[00:04:11] Unknown:
welcome.
[00:04:44] Unknown:
Happy Bitcoin Tuesday, freaks. It's your boy, Matt O'Dell, here for our weekly Citadel dispatch, the interactive live show about Bitcoin distributed systems privacy and open source software. To our freaks joining us on the audio feed, That was our CNBC crew this morning grappling, I guess, with this new idea that another COVID lockdown is gonna hit us. And, just, you know, kind of you kinda can feel like a little bit of panic in the air from the mainstream journalist. I know that was a more trash clip than usual out of, CNBC, but, I kind of view them as a time capsule. And I think in a couple years, we'll look back and kind of laugh at all of these clips. So, here we are showing them regardless.
They used to be the most watched Bitcoin show in the world, and now they kind of have put Bitcoin on the back burner. It's just, like, kind of a side note, which is interesting to see. I wanna do a quick shout out to all the freaks who support this show and keep it ad free. I don't want this show to ever have ads or sponsors. I think it aligns incentives better. The best way you can support the show is through the podcasting 2 point o apps. If you go to new podcast apps.com, you search Citadel Dispatch, you load the app with stats, and then you could stream stats to the show as you listen.
You can also donate, via the l n URL QR code, which we do have more guests today. So it is blocked on the video stream, but you can find that on my Twitter profile. Or you can go to citadel dispatch.com and donate through tipping.me or our samurai. The support is real for me, freaks, and I do really appreciate it. I think, we need more people to step up and try this new format. Like I said, I think it aligns incentives better. It is not all it is definitely a slow roll. It's still dispatch. I've been running it for a loss, since we started over 6 months ago, but I think it'll be worth it in the end. Some things, you know, require a strong foundation, and sometimes the mission is more important than the short term gains.
With all that said, this is serial dispatch 31. We have some very special guests today for a conversation that I have really been looking forward to. As a result, to get these great guests together, we had to do an earlier rip than usual. So to the live freaks who are joining us, you know, 5 hours earlier than usual in the live chat, thank you so much for joining us. I mean, the live chat is really live audience chat is really what makes this show unique in my opinion. No topics are off limits. We will get to all your questions. So I appreciate you all who are joining us. So with that said, today's topic is getting started with Bitcoin mining. I think it's kind of fitting since, most of the corporate miners are at a big conference in Miami right now called Mining Disrupt. You know, it's got a little bit of a shitcoin tilt to it because it's got disrupt in the headline.
So I have 3 of the most outspoken pleb miners, miners who have been focused on making it easier for the average person to get into Bitcoin mining and all that that takes. We have Diverter No KYC who's joining the show again. I believe this is his second time. How's it going, Diverter?
[00:08:07] Unknown:
Yes. 2nd time. Glad to be here. Can't wait to get started on this.
[00:08:11] Unknown:
We have Econo Alchemist who's also joining for a second time. How's it going, Econo Alchemist?
[00:08:17] Unknown:
Going great. Thanks for having me. Dude, thank you for joining.
[00:08:20] Unknown:
And we have first time guest, Ronan Miner. His government name is apparently Neil, and that's what he's titled on here. How's it going, Neil? I'm doing great. Yeah. What's up, freaks? So, guys, I mean, historically, the best time to get into mining is in downturns. I think you guys probably all agree that the best time to get into mining is all the time. But I think now more than ever, especially with this recent crackdown in China, and we see all these ASICs prices are going down significantly more than Bitcoin, it seems. It could be a good time for the average Bitcoiner, the average self sovereign Bitcoiner to get into Bitcoin mining. It's a great way to to stack.
If you do it right, there's no KYC. It's it's it's probably one of the most private ways to accumulate Bitcoin. And I think even if it's at a slight loss, those two benefits, can can outweigh, any any loss of income there. But, I mean, you guys seem to have been doing it pretty profitably, so, maybe we get the best of all worlds. So I I'm thinking here with this conversation, it's gonna be a general getting started with Bitcoin mining, acquiring ASICs, setting up the ASICs, power costs, and other things people need to keep in mind. We'll have a conversation about KYC and how to limit it, limit your personal information. We'll talk about Compass hosting and other hosting providers that'll host your ASICS for you and the trade offs present there.
We'll talk about cloud mining, which I personally think no one should use, but I guess we'll get into that. And, we're just gonna talk about the state of mempools like we always do, and and we'll see where this conversation takes us. Like I said, freaks, if you have any questions, feel free to throw them in the audience chat. If we don't get to them right away, I am jotting down questions, as I see them as well. So so, hopefully, we will get to all of them, as we go on. So so I guess where where should we start? Why why don't we start with with Neil?
Neil, to to the average to the average freak, you know, maybe they've been listening to Citadel Dispatch this whole time. They're trying to improve their setup. Why should they be interested in mining Bitcoin?
[00:10:40] Unknown:
Well, simply, it's KYC free sats like you're saying, and then, it's income. It's so when well, back up. Some guy, Fartface and Nick Foster just gave me miners were worth s nines were worth nothing. They just sent me a couple each, and I was mining at a loss last July, so a year ago. And just to do it, just to wrap my head around it, figure out what it was all about, and whatever. So I'm paying a little bit of premium. I'm not sure if that premium was even more than, like, CoinJoin implementations. You might be paying the same fee. I never looked into it that closely. But and then I and then you hear Michael Sailor say some things and kinda it just, like, dawned on me. And I was like, well, what what are my personal options in the future for for yield or for how am I gonna ever execute on these Bitcoin that I've been sitting on? Like, your only options are sell your Bitcoin or lend it out to one of these 3rd party lending services that I've never trusted. I've never supported. I there's no there's no reason for me to ever do that, but it seemed like the only other option.
And simply just buying, maybe spending a little bit of your Bitcoin to get some machines was a better idea, and then you have a solid yield coming in regularly. You're always you're always you're at least if you have to spend the Bitcoin, it's not your stack. At least you're making Bitcoin that you could be spending.
[00:12:13] Unknown:
That's some great insight. Diverter Eco, you have anything to add there?
[00:12:20] Unknown:
Well, for me personally, I I got into mining, originally solely because I saw that, the trajectory that Bitcoin was on, or the on and off ramps, I should say, that the was on is that everything is becoming more KYC. KYC is creeping in everywhere. No matter where you look, if if you have to put an identification in. So I'm I'm trying to figure out ways that I can continue to acquire Bitcoin without having to do KYC. Now this is in 2,000 18, I guess, the very end of 2018, maybe 2019. Anyway, it was a while back, and I I started thinking about mining. But then when I came on to, Bitcoin, forums, places where you would go like Reddit, Twitter, places like that, and it was completely and totally discouraged that, you know, you should not even worry about mining. Just buy and hold. Just buy and hold. Just buy and hold. But that's not accomplishing my goal. Like, the whole point is I I I want to get Bitcoin, but I don't I'm afraid of the KYC part.
So after a little research, I look into it, and I can't figure out why I wouldn't do it if I understand that I might very well lose a little bit of money here. Generally speaking, though, if you go to a BISK or a a HODL HODL or one of those platforms, most of the time, you're gonna be paying a little bit of a premium over regular spot market value. So what's the difference, you know, the way I see it? So there's there are plenty of reasons to do it if you are concerned about ways that you can acquire Bitcoin and keep your identity more hidden, but it's not for everyone. So, you know, it's a very personalized thing. It's it's what these blanket statements of either everybody should mind or nobody should mind, they don't they don't help anything.
[00:14:30] Unknown:
Yeah. I mean, I think that's a really strong point about the privacy premium you pay regardless. I mean, Neil touched on that, you know, but between whether or not you get it on Bisk or Huddl Huddl or or local ATM, you know, a lot of these local ATMs, some of them only require phone number, and and you can use, you know, a burner phone number. They often they often come at a premium, and you often you're reduced in the amount you can purchase at a given time or cash trades or, you know, selling for goods and services. Or as Neil mentioned, if you do KYC and you go through KYC, this the only, in my opinion, if if you're using a KYC service, it's completely unsafe.
But if if you if you use it with CoinJoin, at least you get some forward privacy, and it's reckless not to use it with CoinJoin in my opinion. And when you use CoinJoin, then you're gonna you're gonna take additional fees. You're gonna be paying minor fees. You're gonna be paying CoinJoin fees as well. So So in general and, I mean, I think this is probably bigger than just the Bitcoin world. I think in general, privacy usually comes with a convenience and a and, an additional monetary cost, every time you want to do something that's more privacy conscious. Right? So we have diverter, I guess, was, like, the first one to really release a, like, a full write up on how someone could get started with doing this. I think he called it mining for the streets.
I don't know if if is that guide still out there, Diverter?
[00:16:01] Unknown:
Yeah. You can find it on on, my blog. It's on, links in my Twitter profiles, diverter.hostyourown.tools, and then money for the streets is is the name of the article. Awesome. Yeah. And and like you said, it's the fact that we're even sitting here having this conversation right now, not to sound like an asshole or or or arrogant jerk or anything, but it makes me feel fulfilled in in a certain way, because the whole point of me trying to put out, mining for the streets was was exactly this, to to try to change the narrative. Because at that time, it absolutely was not was not advised for anyone to get into mining. Nowhere you went, could would you see anyone that would encourage you if you said, hey. I'm thinking about getting a miner. It was immediately shot down. So the fact that this conversation has even taken place, whether it had anything to do with me releasing this or not, I still feel,
[00:17:04] Unknown:
an amount of fulfillment from it. Oh, it it it has definitely had something to do with it, man. I I read that article so many times, and it was so instrumental in, like, me thinking, okay. Maybe I should start doing this now. It's still it's still one of the number one articles I I share with people when they're talking about, well, where do I even get started? And I'm like, well, here you go. I I send that article to so many people.
[00:17:26] Unknown:
I mean it I mean, it's been a narrative that's been around. I remember, like, even in 2013 on, like, Reddit and, and Bitcoin talk, like, people would say, like, because for whatever it's worth, the for some reason, normie's a first inclination, if you're a new corner or a pre corner, your first inclination is I wanna mine Bitcoin. It's just, like, the natural path that people usually take. You even see it with, like, the institutional guys or, like, the CNBC people. Like, they just immediately, the first thing they say is, like, I wanna mine this thing, with my computer.
And then people come into Reddit. They come into Bitcoin Talk. This was back in, like, 2013, 2014, and the first thing that people say is you're gonna lose more money if you mine. Don't fuck around with it. Mining's only for the professionals. And to this day, we still see it on Twitter. So I think, Diverter, I think you made a very big impact. I mean, we have Eco here, e Econ Alchemist here, and, I mean, he credits you with his he came out with his own guide, a very, very good guide. And, Nico, you credit Diverter with part of that inspiration. Right?
[00:18:31] Unknown:
Yeah. 100%. Diverter's article was a huge breakthrough for me. You know, if if we back up, like, 8 months ago, I I had made the decision that I was never gonna KYC again. I was all out of dry powder, but I still wanted to accumulate Bitcoin. And so I was just kicking rocks trying to figure out how I was gonna get more Bitcoin, and I and I just kept coming back to mining. But as you guys have highlighted, the narratives were just don't do it. You're gonna waste money. You you can't mine unless you've got your own hydro plant. Like, leave it to the big guys. So, you know, I was just searching for something to some way to get more Bitcoin. And and diverger's guide, I I found that and read it, and that was just the light bulb moment for me that that made me look at the whole situation not so much in the sense that I was gonna be competing with the rest of the network, but that I was gonna be dollar cost averaging through my electric bill. And so that instantly solved the issue of privacy, KYC, third party risk. It was a no brainer for me. And like Diverter said, even if even if I was mining at a little bit of a loss, I was gonna be paying that premium on bisque anyways.
So, you know, that was that was a huge moment for me, and it just kinda opened up this whole new frontier.
[00:20:02] Unknown:
Yeah. And I still have I still have people up in my comments telling me. I just had a guy the other day that was vehemently arguing with me on whether whether a single person could mine profitably or not. And I was like, I don't care that you failed at it. That's not my I'm sorry, you mined through a bear market or whatever you did wrong, over allocated or something. And it's like, no. It's been it's been very lucrative for me. So I have no I have no problem in telling people, like, as long as you do it right, like, it's the same rules that apply to Bitcoin.
You DCA miners, you get a little extra cash, you buy another miner, something like that. You see a dip like we just saw, you buy the dip. The same rule apply. And then you plug them in, and you let them run. And even so every every unprofitable sat that I've ever mined is deep deeply profitable right now. I just hung on to it. If you're not selling, you're not losing money. So
[00:21:05] Unknown:
Yeah. And, you know, it's a it's a it really is a mindset type of thing. You know, the and if you think about it, one of the things I I talk about in Mind for the Streets was the entire ethos around Bitcoin. Everything centers around don't trust, verify, except in this one area. This is the one place where everybody was actually encouraged to just trust that somebody else is gonna mine. You don't have to worry about it. The big guys got it. And that just struck me as all kinds of wrong in in many different ways. So, you know, the difference really is comes down to a mindset of, okay, am I going into this as an actual profitable business or as I am I going to this as a way to accumulate Bitcoin in a way that's more private where I can attempt to keep my identity more more hidden?
And the upside, as we've seen, recently is you you actually don't know whether, just buy and hold will be more profitable. BlockWare Solutions, put out a report, which I linked to in in in the guide, from a previous cycle, talking about, whether people that, just bought and held or those that mined and actually sold just to pay their electricity bill, who came out the best at the end of the bull market. And it it it was the miners. It was the people that were mining and and just selling enough to pay, their income, and the reason is probably just because of situations like we're in right now. So things can change even if you go into it mining at a loss like like I did. I was mining at a loss when I first started, and I think you said you were too, Neil, but things can change so quickly.
The difficulty adjustment has the ability to, you know, kind of stabilize this market. And if some outside in influences come in, you never know. You may be you may end up extremely profitable like we are right now.
[00:23:14] Unknown:
Yeah. And you don't and then and this is, this recent event is actually super fascinating because okay. So even 3 months ago, miners were twice or 3 times the price, and the price the price of Bitcoin was higher, the network hash rate was higher. But then you saw, okay, your your physical equipment has been devalued because all of these miners came out of the market for sale. But at the same time, network cash rate dropped, so then it became ultra profitable to be a miner. It's almost like its own its own, like, self fulfilling hedge against.
I didn't really think that idea through before I started it. But, like, you're always maybe your miners go down in price, but now you're making more Bitcoin. So it's, like, it's a win win either way.
[00:24:03] Unknown:
Right. But so, I mean, an interesting aspect here, right, is a lot of people, I think, when they think about getting into mining is they they always go to those, like, calculators. Right? Those, like, revenue calculators. And Bitcoin is such a crazy beast that, you know, you have 2 aspects that the calculator can't really predict, right, which is, you know, how the what happens with the difficulty adjustment, and, you know, how much hash is on the network, how much hash leaves the network, and what the Bitcoin price is. Right? And that's, you know, in in a way, I mean, if you if you're if you're mining, it's it's even more of a long term game than if you're doing buy and hold or or stacking. Right?
[00:24:42] Unknown:
That's yeah. That's exactly right. That the whole point I I made the argument that, especially a home miner, is actually the most bullish person on Bitcoin. You think you're bullish. Well, do you have a miner running in your garage? Because, what that means is you can't just suddenly lose faith one day and decide to hop on Coinbase or Kraken or wherever and just sell all your Bitcoin and walk away. It doesn't work like that. If you're going to to mine Bitcoin, you're gonna put in time, energy, money, into setting up your infrastructure. You're not gonna be able to just what are you gonna do? Just just just turn a miner off and leave it sitting in your garage? Now you've got 1,000 of dollars worth of equipment.
So it's absolutely a long term bet on Bitcoin. So, you know, get your get get your mind right before you just think about it.
[00:25:40] Unknown:
Yeah. And it's not it's not easy money. It's not like you just go and plug in a miner and and you start printing your own money. It's it's a lot of work, especially if you wanna scale up an operation. Then now you're talking okay. So, like, for example, 400 amp is about the most power you can get going into a residential without without really having to pull some strings and do some stuff. So 400 amp, that'll that'll do 20 new generation miners, and then you're tapped out. You're not increase that operation by by very much more. So you have to start looking elsewhere to to figure out where to go. You that's why I call myself a power pirate. You gotta go wherever you can go to find more power.
And then so, like, for example, what I've been looking into right now is there's somewhere around 1500 subways that closed either during the pandemic or the year before well, in the last couple years, 1500 subway locations have closed. They have bread ovens in there. They have other machines, stuff like that lighting. They use a decent amount of power. They're probably somewhere between 406 100 amps for a location like that, and they're all sitting empty right now. And there's nothing more than that strip strip mall owner wants than to lease that out. So they're gonna give you a pretty decent deal on the lease itself, and then your only issue is dealing with airflow, deal dealing with heat and noise.
And there you go. You got another you got another petahash location just handed to you. You didn't have to build out the infrastructure for it or anything like that. And I guess where I'm going with this is, like, you wanna keep it small and you want to spread it out. So if the power in the town goes out or you lose Internet access or something like that, you don't have a 100 machines going offline at once. You're better off, like, distributing an ad out to smaller locations. Yeah. It's a little more man hours going around each one, but once once you're up and running, like, you could do that in a day. You can hit 5 locations in a day, and there you have there you have 5 Petahash online. You're you're doing just fine.
[00:27:59] Unknown:
As you guys can tell, Neil has really taken off in the last year. Like like, me here here, me and Eco are, we've got a we've got a miner or 2 spun up somewhere in the back room. This dude's renting out subways. Okay? So this this thing is a serious bug, when you get into it. Believe me. Oh, it's it's definitely addicting.
[00:28:22] Unknown:
Yeah. It goes to the same like I was saying, the same rule for for miners is you DCA the miners, and then you buy it buy buy the miner dip. It's the same thing with with hash power. You never look at your bottom line hash power number and say, that's good. I'm I'm satisfied with that. No. You never look at your Bitcoin stack and say, alright. I'm gonna stop stacking now. No. You always want more hash. It is it is probably more addictive than stacking coins themselves, actually.
[00:28:55] Unknown:
Yeah. And it it is a commitment like Diverter was saying because in in in relative Bitcoin terms, it's gonna take you, you know, 8 months to a year to earn back the amount of Bitcoin in mining that you would have had to have spent to get the hardware. So, you know, you you gotta be in it for the long run. And then what other business you know, there's there's just not a lot of other business models out there that will give you a return on investment in a year or less. So it it you know, once you get into it and you figure out how it works and you get over that infrastructure hurdle, and then you start seeing that you're getting really close to return on investment. Well, then you wanna take some off the top and reinvest and expand your operation.
And that's why I'm saying it's addicting because that's
[00:29:52] Unknown:
And you look at it happened to me. Yeah. And you look at it when you start when you start scaling up, you start seeing, okay, ROI might be increasing because of additional costs. Like, okay, you owned you owned the first 400 amps at your own private property or something like that. Okay. The next 400 amps is gonna cost you more because you have to lease it out. So you start looking at increased costs like that, and it kicks your ROI kicks your ROI down the road a little bit. But then you also have to remember, on ROI, you're not it's not just a initial capital investment that you're looking to get returned on. I mean, because the machines themselves are also if the price is going up, the price in the machines is going up. And then with this recent shutdown of, microBT, where they're not even manufacturing new generation machines till September, And I don't know what Bitmain's doing. They put some hold on on selling, and sounds like they might still be producing, but they put a hold on selling. So, I mean, the glut in the market may completely flip on its head where all of a sudden there's a shortage because you have a company like MicroPT that's no longer even producing them.
So then now you're looking at, okay, so you ROI'd at your cost. Your machines are paid off. I mean and if you needed to shut down one of these one of these small opera one of these small 20 unit operations you have going on or something, those machines may, even though they're used, may have appreciated in value 3 x. So, I mean, you got the the world's your oyster at that point. And I know I personally know a guy. He just got a $1,000,000 loan collateralized by his machines. So if they're doing that now, then the the leverage the leverage on the machines themselves is going to like, okay. So you get a $1,000,000 loan collateralized by your machines.
So what are you gonna do with that $1,000,000? You're gonna go out and buy $1,000,000 more machines. So then now now you have that many less machines out on the market. And if people start doing that regularly, then, I could see a definite a definite run up in the price of machines themselves.
[00:32:08] Unknown:
So I'm gonna just jump in here real quick. First of all, Neil, I fucking love the hustle. Never considered Subway locations. There's obviously a massive retail vacuum because of COVID, because of lockdowns really, less so COVID, but the response to COVID. So that is definitely a major opportunity. I just wanna say to the freaks, you know, if you do use leverage, be responsible with it. You know, interest rates are low, so people are happy to give you a shit ton of debt. Historically, like, the horror stories you hear about Bitcoin mining are are pretty similar to the horror stories you hear about Bitcoin purchasing Bitcoin, which is that people go in way too heavy at the top.
They don't know when the top is. None of us know when this cyclical top is gonna be. And with Bitcoin mining specifically, you end up having fixed costs, especially if it's a larger operation. And those fixed costs, you know, could be labor. They could be rent. They could be electricity. And those fixed costs, if if if you're not set up to deal with them, you end up selling the bottom, whether that's your ASICs or whether that's the Bitcoin stash you built up. I'm completely down to go deeper down this rabbit hole, but I think before we do, I think we should pull it back a little bit and talk about this idea basically of, you know, having 1 or 2 minors in your home or your office, a place you already have electricity. Maybe you live in a colder environment, and it can also offset some heat costs so you don't have to really deal with cooling.
It's definitely way more accessible, you know, if it's only 1 or 2 machines, especially to get your your toe in the door, which is is what I think the focus of the show probably should be. I'm curious. Like, I think part of the reason I've always been interested in Bitcoin mining is for ideological reasons. Like, I I think what we want to see as stakeholders in this network, is this idea of Bitcoin mining distributing out to more people and more small operations, that are ideologically minded as well, that believe in the idea of freedom money, that believe in the idea of censorship resistant Bitcoin. Does that factor at all into your guys' mining, or is is that just a is that just an afterthought after, you know, stacking as much as possible?
[00:34:23] Unknown:
Let me back up to your your what you were just saying, and then I didn't include it in what what I was saying is, but no. Leveraging your miners, using them as collateral towards anything is, like, the worst idea ever because you wanna be doing the opposite. You want to be having some capital on hand that weathers the storm. The last thing you wanna be doing is selling your Bitcoin at this point. So you want to have if you have 2 thirds of your capital in miners, you want a third of that at least in in reserves so that you don't have to sell. The name of the game is not selling. If you're selling coins to support yourself, you're probably in a rough way, and it's not gonna last very long for you. So, yeah, don't leverage.
[00:35:09] Unknown:
And just to be clear, like, this is not that's just not a mining PSA. Like, there's a lot of people that, you know, took collateralized loans out on their Bitcoin right now that are feeling pinches, because of this price decrease. And in in my mind, it's it's a if if you don't manage that risk correctly, it could be very reckless if the goal is, you know, long term accumulate as much Bitcoin as possible.
[00:35:32] Unknown:
Yeah. To your to your question about the the the ideological, reasons for mining, For me personally, originally, no. It it I didn't. I wasn't thinking, you know, how can I help this network? I was thinking, how can I personally, acquire more Bitcoin without doing KYC? So the beauty of Bitcoin is the incentive models. So the incentive model for Bitcoin is if each individual acts in their individual, you know, best interest that that collectively helps the network. So it works perfectly. Now I've I personally don't believe that anyone should rely on altruism as any sort of business model.
So if you're dependent on people being, quote, unquote, good people, you're not gonna make it. So what I like about this individual or what I've kinda termed a garage band mining, what I like about that is that it it kind of helps the incentive model for Bitcoin even in a in a situation where, let's say, the the subsidy the block subsidy is gone. Alright? We're of course, we're talking a long time down the road here, but the point being, if it were if a day were to come where, it's not so profitable for these big huge mining farms to be running, and they shut off, what is the network still secure?
There's a lot of things that that go into this, though. And like I said, even though I don't believe we should rely on altruism, there's some things especially developing now where they it sort of aligns really, really good. Like, for example, this flared gas mining that that Marty and Great America and places like that are doing. A lot of times, like, that right there, that's actually helping, these oil and gas operators. So even if that were, that operation were technically losing money, it could still come out as a benefit to them if they were saving money in in another area. So point being, the incentive model is really aligned perfectly in Bitcoin. It's very, very well done as a system.
But as an individual, I I highly suggest that everyone, that's looking to get into mining, get into mining as an individual. This is not one of those, hey. I'm just gonna run a miner to help the network situations because it's not gonna work out for you, and you're gonna end up losing real money potentially. So help yourself, and by helping yourself, you will help the network.
[00:38:24] Unknown:
Yeah. I totally I totally agree with that. And start small. Don't, like and by small, I mean, like, a single s nine or something like that because you don't you don't you're not they look cool. It's fun, but you have the complexity or, like, the the number of things you have to deal with once you have one when it comes to either heat or noise or I mean, you can hear these everywhere in the house. There's very few places you could put it, even in s nine, and you don't have some some sort of background noise from it always. And if you can if you can find a way of quieting it down or something like that to to Matt's question earlier was it was incredibly profitable for me this winter.
I just had a few s nines running in the crawl space under a condo, and I called my my local power provider, my utility company, and I negotiated down a rate that if if if I was using electric heat for my home and not not heating my home with, natural gas, they would give me a deeply debt discounted rate here in Minnesota. And I I mean, I had my electric rate down to 6¢ a kilowatt hour. So even running s nines, high network hash rate at the time, they were still profitable. I was, I mean, I was paying off the place. And so that my mortgage, my HOA, and my electric bill with 3 s nines and an m 32, and I was heating my house for free all winter from May until October was what they negotiated the deal with me. And that's just me. I'm just as a person. I just called my electric company and told them I was using electric space heat, and they dropped my rate.
And, I mean, that's that's better than any, any tenant you could have rent in your place, screwing up all your stuff and clogging your toilet. I mean, there's a couple noise complaints about how loud my tenants were, but, otherwise, free money.
[00:40:30] Unknown:
Yeah. So, I mean, I agree. The one of the reasons I've always been bullish on Bitcoin is because of the incentives, because we can't expect altruism. We should expect greed from people, and Bitcoin's one of the few systems, if not the only in in our world where it it actually channels that greed to make the network more robust. I guess where I was kinda going with it is, I think as, you know, among the Bitcoin enthusiast community, among the people that are obsessed with Bitcoin, you know, the audience of this show, the industry at large, I I think there's there there's an incentive there where a push to make Bitcoin mining more accessible for the average person, benefits us all, because the network will be more more robust and more secure.
And logic follows that as a result, the the value of the network should increase and our holdings should increase. I mean, there's a there's a major difference, and and we kinda saw that on an extreme, during the 2017 scaling wars where Bitmain was keeping their miners for themselves. Right? And they were mining first before they were releasing it, and they were the main hardware producer of the whole system. And and there's definitely this this existential risk to having these large corporate miners having mining controlled by a very few groups of individuals, that are easy to knock on their door, easy to pressure them, easy to get them to bend the knee.
So, I mean, in general, I commend you guys for for just, you know, pushing for this more accessible you know, making Bitcoin mining more accessible to the masses, if you get what I mean.
[00:42:19] Unknown:
Yeah. When I was first getting started, I I didn't really think I could have a whole lot of impact on the network just running one ASIC. But then you know, so it wasn't so much for the ideological reason of running it. But then when Marathon started censoring transactions, that's when I took more of a sense of pride in in in claiming no one's gonna be able to use these 80 terahashes per second to censor transactions because I'm in control of them. So, you know, I now I wanna get as much hash power as I can so that I can ensure that no one else is using that hash power to censor transactions or use the network in a way that that I disagree with ideologically.
[00:43:07] Unknown:
Yeah. And if there's if there's nobody gonna mine those transactions, fuck you. Well, I'm gonna mine
[00:43:14] Unknown:
them. Right. Right.
[00:43:16] Unknown:
And that brings the incentives back in line too because, if if the majority of the hash isn't mining a certain transaction, those fees on those transactions will go up, and you'll make more money than a miner that isn't mining them.
[00:43:28] Unknown:
Yep.
[00:43:29] Unknown:
Right. Yeah. And, you know, the power usage, is is not, easy to disguise or hide this. You're you're not gonna hide a a a large ASIC farm. But, you know, as as I've seen Marty mentioned a few times that he believes the future, of mining is off grid, and I tend to agree with that. I just believe there there's a little bit of an asterisk there because, in my opinion, these single, you know, garage band type miners are essentially off grid. You know, you're running an ASIC or 2. If we've got 10,000 households running an ASIC or 2 rather than one mining farm running 10,000 ASICs, that completely changes everything.
100%.
[00:44:18] Unknown:
Yeah. I absolutely agree with that too. And that's kinda, like, why why me and my brother started, like, getting into this this immersion thing because it's nothing the power company will come out and give you 400 amps. They'll just do it. You hire an electrician. They'll do your panel. My brother, Saint, by the way, I lucked out and, had an awesome brother who knows how to do all that shit. So I stick to the mining side. He sticks to the actual rails making it work side. But once you have immersion, then you've eliminated the 2 things that I found to be the biggest problem is the noise and the heat, the disturbance. Now you only have, like, a a, what, maybe 8 by 8 by 4 footprint in your garage. Most people to have a Petahash would be willing to willing to accommodate that loss of garage space.
And and then I see, like, there's no reason why every every dairy queen or every household wouldn't wouldn't do that. I mean, the network cash rate I I see in the future is just gonna explode with these with these small miners compared to the large mining farms.
[00:45:32] Unknown:
Yeah. And, you know, the efficiency is is what really increases this. I don't know where you're gonna take this, Matt, but, you know, one of the most common things, that I see people ask whenever they're first starting to get into mining is is what what should I get? Should I get just an, you know, an old used s nine just to kinda play around with, or should I, you know, get a brand new, s 19 pro? You know, how how should I start out here? I've always been I'm always of the opinion that if you're just going to be, you know, a a a single ACIC, maybe 2, running in your home, you should go ahead and go with a good new generation high efficiency miner, rather than go with the s nine, now if that's possible.
I don't believe we will ever again see the same type of efficiency jump that we've seen from, say, the s 9 to the s 19, where we went from 13 and a half terahash at almost, you know, 1500 watts, where we're up now to, you know, a 110 terahash at at just barely double the, the electricity usage. So I don't believe we'll see that efficiency gain in the future. The the race to this point for ASHIP manufacturers has been the race to efficiency. How much hash rate can we put out? I'm of the opinion that in the future, these ASIC manufacturers, will likely the next race is now to longevity.
It's no longer a race to how much hash can we get. It's a race to how long can these miners run. So there's really a spot in the market, in my opinion, for, an ASIN manufacturer to potentially use some of these higher efficiency chips in a, a a a smaller type miner. So rather than an s 19 that gets you a 110 terahash at, you know, 35100, whatever, electricity usage, maybe they they they hit you with something a little smaller that's more capable of being run-in a home that is designed specifically for longevity. Because I I I really think that's where the future of this game is is in seeing how long these things can run rather than how how fast can we get to hashing.
[00:48:02] Unknown:
Absolutely absolutely same thesis on my end is I I think that this new generation may may last upwards of 10 years. And so what you you and, again, that goes back to the immersion thing that I've been that I've been looking at with my brother is so a a cool clean computer is a happy computer. You wanna keep everything you wanna keep it in a static environment. You don't want it the fans all kicking on higher because it's a hot day out or something like that. No. You just want a nice static environment to keep the machine as as stable as possible for as long as possible, the least amount of particulate matter, the least amount of heat or humidity, or if you're in a salty environment or anything like that.
And then, there was another point that you'd said before I was gonna say. But, yeah, I I totally agree with you. I think I think these may last a long time and,
[00:49:03] Unknown:
yeah, go ahead and talk. I forgot what I was saying. Yep. I mean, just look at the s nines. Like, those have been running, and they're still running profitably going on how many years now. You know, I I think these Whatsminers that are coming out now are gonna be that next industry works for the years to come. And I think it'll last well into the next subsidy
[00:49:23] Unknown:
epoch. I mean, s nines were what? Like, 2016, 2017? Yeah. Something like that. Yeah. 2016, I think. This has been this has been a thing, you know, a topic that we've been, we've talked a lot about on rabbit hole recap over the years. This idea of ASIC life cycles increasing. Right? And I think it's particularly well suited for home miners and small miners, because acquiring ASICs can be difficult. Acquiring new ASICs can be difficult. Getting rid of your old inventory can be difficult. And the the big players, it was kind of for for a little bit there after, you know, ASICs got developed to begin with, where they were, like, kinda just racing to the next generation. Right? Make some profit and then race to the next generation.
Especially, when you start talking about home mining and trying to recoup heat costs, if if, you know, you you want you want hardware that'll last you a bit. You know? And I would get go even further, you know, if we're gonna talk about I I expect, to see pretty much, like, every hot water heater, especially in urban environments where there are larger hot water heaters, you know, mining Bitcoin on the side and reclaiming that heat through the hot water, and no one wants to to replace their boiler every 2 years or 3 years. Right? But if you get to the 7 to 10 year point, that that all of a sudden becomes much more feasible. Right?
[00:50:52] Unknown:
Yeah. That's exactly what, Sato Mining is working on right now. I think they're out of France.
[00:50:59] Unknown:
Yeah. And you start you start getting in a whole whole other realm. So the reason why I always talk about 20 miners, 20 new generation miners, the reason why I keep bringing that one up is because it's all pretty pretty static. You're gonna generate about the same amount of heat regardless of if you're with the new generation Antminers or the new generation MicroBT. What's miners? And you're talking and the reason again why I say why I always say 20 is because that's 400 amps. That's about the maximum you're gonna be bringing into a residential area if your if your wires can handle it coming in off the street.
But you're talking about producing 210,000 BTUs that you have to that you have to disperse, and that's right along the lines of, I think, a a 10,000 heating a 10,000 square foot dome. So you're talking a lot of heat being generated. And, I mean, you can start running in floor heating,
[00:52:01] Unknown:
hot tubs. Your water heater is probably gonna be heated up no problem. That's just not that much. I remember seeing a pool heater. Right? Like, a a pool water heater. Someone made a guide for that or at least a walk through.
[00:52:13] Unknown:
Yep. Exactly. And we actually spa 256. Yeah. Yeah. We actually even looked into, running some because, like, in Iceland, their their streets and their sidewalks have essentially what's the same thing as in floor heat because they just have so much geothermal that they could just they can do that. And we looked into doing that in some sidewalks in Saint Paul just to get rid of our heat, but then you run into the problem is how how are you gonna get rid of the heat in the summer? Now you need a separate system. And if you're gonna build out that separate system to get rid of the heat, then why are you eating the sidewalks other than laziness? Just go up and shovel.
[00:52:53] Unknown:
Okay, guys. So so first of all, to the listeners, I'm gonna put both diverter and econoalchemist guides, in the show notes, in the podcast show notes, and and also, on syllabuspatch.com in those show notes. So you should definitely go and and give those a proper read through. They're very, very detailed. Neil, I don't think you have any proper write ups. Right?
[00:53:17] Unknown:
No. Hell no. Anyone who wants to talk to me, my DMs are always open. I help anyone who wants any questions. Awesome. Well, so both those guys will be in the show notes.
[00:53:28] Unknown:
But let's go through this. Right? So the first step is acquiring some miners. Where should Freaks, how should Freaks go about that? What's the best ways to do it? You know, what are some gotchas? What should they be concerned about, etcetera?
[00:53:42] Unknown:
So if you're looking to just start with an s nine, just wait. Joe Rogers is gonna throw up another shop here as soon as we get these current s nines out that we have coming on, we're selling them. Those ones we sold all at cost. Now we decided that we gotta make $20 a minor or something like that. So they're gonna be a little bit more than literal at cost because I have to buy a plane ticket to fly down there and help them ship them all out. But, other than that, I mean, if you're looking for an s nine, you could buy as many as you want from that shop. That store will be going up soon. I'll be posting it everywhere. I'm sure I'm sure these other gentlemen will be too. And that's just trying to get as many minors in the hands of Pleas as possible.
Like, we need we need to arm the cyber hornets so that everyone at least knows what's going on. If you don't like it, sell it off to someone else. Like, whatever. It's not gonna work for you. Just try it. And then, I I mean are pretty cheap. Right? What are they going for right now? Like, 300 or something like that? Yeah. They were $300 when we were selling before. When we when we put up the next store, they might be close to 400. All depending on what the market does. I mean, if there's another million miners coming from overseas, like, that's gonna totally change the price. So I I I don't know. That's that's why we're waiting. We just wanna deal with the first, however many we sold, and those are at cost. We literally didn't make a dollar from that. And if there is anything left over from shipping, we're just either gonna open a bar tab down at Bitblock Boom, or we're gonna donate it to Bitcoin Beach or something like that. Like, we're not we're not we're just doing it because we want people to know how to use miners. Then we wanna know what kind of, yeah. No Joe Rogers. It's plebs.
[00:55:29] Unknown:
No. It's definitely plebs. Joe's right on this one.
[00:55:32] Unknown:
Nice, plebs. And then
[00:55:35] Unknown:
and then as for and I I'm just gonna show this guy because he's become a friend of mine because he's just been such a good such a good supplier for me, and I've never had issues or anything, and then I have problems. I just call him directly is, Nick Foster at Kaboom Racks. There's a there's a Telegram marketplace at Kaboom Racks, and you can just go and watch. A lot of times, there's large minimum order quantities, so you might not like, you might want a single m 31 s, but minimum order quantity is 20, just hit me up. I can pile some people together, and we'll go all in on it together. That's not a big deal. I know he kinda likes a couple places that he likes too, though. So
[00:56:23] Unknown:
Yeah. The Before we move to, Eco, just real quick, how does that process with Kaboomrax work? It's like you it's a Telegram channel, and then it's like an OTC deal. I guess you have to, like, DM Nick and then process the deal separately?
[00:56:38] Unknown:
Yeah. Yeah. It's a marketplace where only only Kaboom Racks puts listings up. And if you want something, it'll tell you if you wanna do it yourself, there's a link right there in the in the listing. And then, like, I'll just call I'll just call them when I want something or whatever, and we hook something up. We hook up the deal.
[00:57:00] Unknown:
Awesome. Okay. You go.
[00:57:02] Unknown:
I I was just gonna add the Telegram channel, hardware market verified listings. And, you know, that's where Nick from Kaboomer Axle post some stuff. So Nick's got a really good reputation in the community, so does Blockware Solutions, and so does Mindfarmbuy. And all those guys post in that channel. But, you know, I when people ask me, I recommend going to that channel and searching there. Anyone posting in that channel to sell has verified themselves with the admin. You know, they've provided identification documents so the admin knows who they are.
That's not a silver bullet, and, you know, they're they're still can be scammers, so you always wanna proceed with caution. I, myself, almost got scammed out of a quarter of a Bitcoin 6, 8 months ago when I started down this path. Not from that channel, but, you know, going venturing out to doing online searches to buy minors, looking at, like, Amazon ads or eBay ads or going to, you know, whatever website I found that had anything to do with Whatsminer. There's a lot of really elaborate scams out there. There's people standing by that will respond to your emails. They'll convince you that they've got what you want in stock, and they're ready to ship. You just need to send them a payment.
So, you know, just just be careful. And there's also, a Telegram channel for, like, blacklisted scammers. So you can always hop in that channel too and just, like, ping that group and say, hey. Has anyone worked with this person? You have any background on them? Is this a scam? Does this sound fishy? And, you know, there's people out there that'll that'll back you up and let you know what's going on.
[00:58:55] Unknown:
Absolutely. You're so right about that. And and you're talking about a lot of money. If you're buying either 1 one minor new generation, you're talking about you could get a car for that. So don't always run it by someone. I still do. Before I make any type of purchases or anything, I still run it by someone and be like, hey. Will you just take a second look at this? I mean, that's a little bit of that has been alleviated now that that I just deal with Nick at KaboomRacks. But, I mean, I can't tell you not to do it because you could do whatever you want, but I just have not seen anything that seems legit on, like, eBay or sure shit, not Alibaba.
So, I mean, just talk to somebody before you go out on a limb and do something. Like, talk to somebody else. Like, all of us are always here to talk about it. Just hit us up. Like, do not make a big purchase on something that you think is not 100% verified.
[00:59:56] Unknown:
So that's all I can say to that, I guess.
[00:59:59] Unknown:
I mean, a lot of it is, like it's almost like an art. Right? Like, I've I've always had a dream, and I guess it'll happen eventually, where, like, there could be, like, a in store like, big cities could have, like, a location where you could just, like, walk in and, like, buy a miner for cash. It's all But we're not there yet. Already talking about it.
[01:00:19] Unknown:
So And then you gotta pick where your cities are gonna be, and then you'll brick and mortar. And You just put it in a subway location, and you mine in the back. And then put a big Bitcoin sign up instead of the subway sign and then everyone knows you're mining in the back? Yeah. That sounds great. I didn't think that one through. Yeah. If you have an merchant, though, they won't know that you're mining in the back. They'll just see a a a minor storefront, and you rip all the guts out of them. So, like, in the cell phone stores, so nobody's got any incentive to come in and steal anything.
[01:00:49] Unknown:
So My brother's got a eBay story. Right?
[01:00:53] Unknown:
Yeah. This, I covered this in, mining for the streets for anybody that's gonna read it, because as these guys have alluded to, the the scams in this particular area, acquiring acquiring ASICs, they are very elaborate. They're very well done, and and they will follow through all these things. As he said, they'll answer your emails. They'll put up great looking websites. They're they're very, very well done because, as Neil said, this is a lot of money. It's not a joke. And, additionally, generally speaking, you're you're paying in Bitcoin. They want Bitcoin. You're not paying in fiat. So once you send that Bitcoin transaction, there is no customer service to get that returned to you.
So this is a very, very, very important part. It's covered in there, but my, original story whenever I first, wanted to get started was, yes, I hit I hit eBay. A couple of these ads, you'll be able to instantly know that they're a scam because what they're selling is just not physically possible. It defies physics. Alright? They they'll put out a miner that gets 410 terahashes at 900 watts or whatever. I mean, it's ridiculous. So you can, you can you know? Okay. That's that's stupid. That's a scam. But now let me move on to this other one. So I bought the miner. It was listed as brand new.
It was a brand new a one, Ison miner, which is a little bit older, 25 terahashes. So I buy it brand new. I wait. I'm all excited when it gets here. I unbox it, open it up, and it looks as if it has been sitting at the bottom of a landfill for about 3 years, and then somebody just dug it out of the landfill, stuck it in a box, and shipped it to me. It was horrendous. Terrible. Terrible. Filled with dust. Just a very, very bad experience. And so moving on from that is where I found, the Telegram group. Just by happenstance, I found the Telegram group. And it it it is also linked in, Mining for the Streets that's linked in there. There's actually a a a an example ad from specifically from Kaboom Racks. I talked to them before I published the guide, asked them, you know, if it was cool if I went ahead and put one of their one of their ads in. And you can actually it's kind of a cool little time capsule because you can actually go back and look then and see what an s 17 pro, 50 terahash was going for.
It's like $1200, I think. Now they're much more. But the the the very important part is to make sure you're dealing with, on this Telegram channel, you're dealing with verified listings. Make sure not only that they're verified, but that they also have a good reputation in that community. Everybody that's there is willing to help you. They're not gonna spoon feed you, so don't go in there acting all entitled, like, you know, somebody tell me where I could do whatever. But go in there, ask your questions, be a regular person, not an asshole, and everyone will help you out, and they'll guide you, and they'll get you on to a good minor.
[01:04:14] Unknown:
Going back to your, your 420 terahash whatever whatever machine that they were selling. You also have to be careful because my understanding is that MicroBT themselves does not sell miners to retail. They only sell through wholesalers. So you can either have a broker like Kaboom Racks or, like, other other reputable brokers in the industry, or you can buy from these retail sites. But there's no there's no distinguishing one from the other other than what they're offering because they'll they'll have maybe some real miners on there, but then they have these other products that are completely insane. And a normal person looking at that would not know that a 400 terahash machine is not possible. They would just say, okay. Well, why wouldn't I spend $10 on a 400 terahash machine when my only other option is spending $5 on a 100 terahash machine. So the numbers aren't crazy to to to somebody that doesn't know any better, but it's it's a scam. So you don't know which ones actually have a relationship with with these larger manufacturers, and you can really get hurt doing stuff like that.
[01:05:48] Unknown:
Yeah. And that goes back to just reaching out to someone in the community and just trying to get a second set of eyes on what you're doing.
[01:05:57] Unknown:
Yeah. It takes 30 seconds. It takes 30 seconds to DM 1 of us and say, hey. Does this look legit to you or not? And Yeah. Typically typically, any of us could just glance at it or anyone in the mining community could just glance at it and be like, no. The the numbers aren't even close to what's even possible in this world.
[01:06:23] Unknown:
Okay. So, I mean, I think, we nailed acquiring a miner, acquiring some hardware. So I guess the next process is setting up your miner. Where do we start there?
[01:06:37] Unknown:
Start with Evo. I don't know if you call it a while. Yeah. I I think infrastructure is the biggest consideration. You know, you've got, you're gonna need 240 volt power supply, and then you're gonna have a lot of hot air that you need to deal with. My particular miner was nearly a 150 degrees at the output fan, so you're gonna have to do something with that hot air. And then you got all the noise. You you know, you're gonna have a machine that's running close to 90 decibels, which is about the same as standing 10 feet away from a freight train as it rolls by. So what, you know, what are you gonna do about the sound?
Do you have a family? Are there is your wife gonna leave you because You know, if you do need to I'll start with electrical. If you do need to do electrical work and you're not comfortable, like, handling that yourself, hire a licensed professional and be aware that there are scammers everywhere. I had a bad experience even though I'm, you know, sufficient at doing electrical work myself and comfortable enough to do it. I didn't really have the time to do it. So I I reached out and hired somebody. They were not licensed, and and that digressed very quickly.
They did some damage to my house. They put my family in danger because of the way they left the electrical panel. And so that was really eye opening. That that relationship didn't end well, and I ended up going back and fixing everything they did wrong and doing it the way I wanted it to be done. But, yeah, you know, I lost some money and and was put at a risk doing that. So definitely vet your electricians, but get a licensed one if you're not comfortable doing that work. You know, for one minor, it's gonna pull, like, 5th nearly 15 amps at 240 volts. So depending on where you put this machine it may be easy to run it into your garage or you may have a shed out in your backyard that you're gonna run a line out to, or it may be in your basement. So, you know, just be thinking about that stuff leading up to ordering an ASIC.
And then after you place your order, it's gonna take a few weeks to get your machine in. And I I think that's really the time when you wanna start gearing up and building out your infrastructure.
[01:09:15] Unknown:
Is it is there anything else you guys wanna add on electrical? I don't know. I don't know if there's anything to add to that. You kinda nailed it. I mean, if you're gonna if you're gonna start building bigger, then you're probably better off having a a licensed professional do it. Because if you wanna bring in new power, like, say, you've exceeded your typical 100 or 200 amp residential power and you wanna increase that, you need to show that somebody actually did that that that was licensed to do so. Like, you're gonna run into those issues then if you're depending on how how you're scaling up. But, I mean, like you were saying, for for a couple minors, you're probably fine. Slap a new breaker in. You're probably not maxed out on your current panel's capacity.
Run 2, 3 maybe even. But you always wanna leave you also want always wanna leave extra. So if you're running if you're running a minor 15 amp draw like you're saying, you want that on a 20 amp breaker and you want to just cut that 20 amps straight off of whatever your service available is. Because if you start if you don't give it that extra 25%, 20, 25%, you start blowing shit up like crazy, like we were doing. I mean, like, we were blowing cords. We were blowing breakers. Like, it was and that was because we were running it a little higher, but close to what the miner's top draw is. But you don't know extenuating circumstances.
Like, it starts to draw for some reason because it like, they'll they'll just rev up at one point, and then it'll start drawing more than what like, the surge the surge of draw can screw you, especially if more than 1 miner surges at once. You're just literally exploding things. I had I had to leave work. I thought I was burning a I thought I was burning a barn down one day.
[01:11:20] Unknown:
It's scary.
[01:11:22] Unknown:
Yeah. Me, personally, I I'm not an electrician. I know just enough about electricity to, get myself killed. So, I I just hired a a a licensed electrician. If I'm remembering it correctly, it cost me around $300, to get it in because it depending on where you're at, like, in the United States, your residential, like, you know, especially if you're living, like, apartment or a rental or whatever, most of the time, what you're gonna have is gonna be, you know, 110, 120, outlets, your normal regular outlets. These newer generation miners, they they won't run on that. Now you can run, some s nines, depending on, you know, the firmware.
You can run some s nines on 110. So it is possible, to to have 110 if you're running, say, an s nine with brains or whatever. You can you can actually get, get a functioning miner that way. But for any of the newer generation miners, you're gonna need to go ahead and upgrade your electricity, and make sure that you have, adequate actual outlets, themselves. And I, you know, again, I keep going back to the guide, but I I try to put as much as I can in there. And there's I've got links and stuff in there to to all the equipment that I use, to actually plug in both of the cords. There's 2 cords on on the s 17.
So, yeah, it's definitely something to to look into and understand before you buy the miner. This is this we actually should've probably done this step 1 because step 1 is actually to understand this is what I'm gonna need before I get this minor. Because if you get it in your house and then you realize, oh, wait. I I I don't have, you know, 2 40 outlets. I don't have all this stuff. Then you're you're playing catch up.
[01:13:12] Unknown:
Yeah. You did definitely say that originally too. You said step 1 was infrastructure, and, we all just skipped right over the most important part of the structure. But, like, s nines are all are all, dual voltage. You can run them on 110 or 220. I think all of them will do that. You you'll run into a problem with your actual core your power cord if it's not rated for 220 on a on an s nine. But, I mean, otherwise, you can plug it in on your countertop like a toaster if you want to. That'll that'll run on any regular outlet as long as you don't have too much other draw. Like, you can't run your microwave and your s nine on the same on the same receptacle or the same breaker.
But anything larger in that, you are correct, is 220. So you're talking the type of draw that's gonna come from your air conditioner, Or if you have an electric stove, that's gonna be 2 20, electric dryer, things like that. So you may have those outlets available to you in your home, but you're going to you can't run anything else on it because there's no way that any of those breakers are rated for more than 20 amps. And you should probably even check the breaker to make sure it's not 15 amps, because if it's 15 amps, then you're gonna have a bad time.
[01:14:35] Unknown:
Yeah. It's definitely ideal to have a dedicated circuit for your miner.
[01:14:40] Unknown:
Yeah. Absolutely. Absolutely. And then so what we do with the, when we're running 10 on our on our bread rack is we actually run a subpanel right on the rack, which is a 100 amps. Wait. Do we run we are on 2. It's 200 amps. My bad. So, essentially, you leave that room. You got the you got the 150 amps from the miners themselves that you're that you're pulling off of each of the panels, dedicated breaker for each individual miner, and then, you have the extra 50 amps in case something happens. You're not in trouble. But, I mean, we were running it off of a off a dedicated circuit for for arc welding, and we melted the thing right off the wall.
It absolutely exploded. It melted right off the wall because it just wasn't rated high enough. You gotta be so careful about that, and that's going back to the original point why you want a licensed professional to be doing this stuff. You can legally do it on your own, but that doesn't mean you can safely do it on your own, and it'll kill you. That's another big point. Don't do anything that you're not comfortable with that you think might kill you. Yeah. Electric's a bitch. Also,
[01:16:04] Unknown:
as Diverter mentioned, it's not as expensive as you'd think it would be, especially if you're buying one of these new gen miners for, like, 4 k, 5 k. You know, it's it's also a cost that will bear fruition in the future if you own the place. I know we have all American miners here, but I think in Europe, 2 20 is the standard. I don't know how that changes the conversation. I assume, you know, they still can't handle the amperage. I mean, you regardless, you wanna get it all checked out before you jump right in. Right?
[01:16:42] Unknown:
Yeah. Definitely. And I I think as long as you got a dedicated circuit that's just for that minor like, even if you are in Europe, you've got standard 2 20 outlets. You know, you should have individual circuits throughout the house, and you just wanna make sure one of those is dedicated for your minor.
[01:17:00] Unknown:
A lot of new construction in, once again, the disclaimers throughout this whole episode are you should make sure everything on your own with with a licensed electrician. But I think a lot of new construction in the United States, especially in hot places, the the AC's the the AC outlets have a dedicated circuit a lot of times, a dedicated 220.
[01:17:24] Unknown:
I think so. Yeah. Always.
[01:17:26] Unknown:
Yeah. Always. Like like, right under the window, like, if you're in a if you're in a new Oh, you're talking they have the window unit.
[01:17:33] Unknown:
Oh, okay. Okay. I thought you were talking about, like, a outdoor AC unit. A lot of times, they'll actually even have a dedicated subpanel where they pull off of the main panel, and then you have your own breaker in a different panel, especially for smaller smaller places like the condos here, this only has this only has a 100 amps. So when I was running 3 s nines and an m 32 here, I mean, like, I was maxing everything out. There was no there was no turning on an air conditioner or running the dryer or I kept my refrigerator unplugged for a while because I didn't know how much drop was gonna be on the overall system. But, yeah, an air conditioner is always gonna be on its own breaker. Your electric stove is always gonna be on its own breaker, things like that.
[01:18:25] Unknown:
Another thing I did too when I was gearing up to receive my ASIC, I contacted my utility provider, and they had a program called, peak demand pricing. So I recommend anyone looking into this to contact their utility provider and see if they have peak demand pricing, which will reduce your overall electric cost by, charging one rate during peak demand hours and then charging a lower rate, during off hours off peak hours. And you can you know, I I I was running at, 12¢ a kilowatt hour, but then the electric company came out, swapped my meter with this peak demand pricing meter, and it reduced my average electric cost over 24 hours to 8¢ a kilowatt hour. So I saved a 3rd right off the top by doing that.
[01:19:26] Unknown:
And see, for me for me, it kind of, it it was similar, but instead of rather doing it on the daily basis because I live in a majority majority of the year, it's a cold climate here in Minnesota. So they did nobody's running their air conditioners in the winter, so they're not using as much electricity, but they're still they're still have the capacity to produce it. Instead, they're trying to conserve money on the, well, coal or natural gas or whatever. Well, I guess it would be natural gas. It wouldn't be coal. They'll be heating their homes with coal. But, so they actually wanted to conserve on their natural gas usage on the residential level so they would give you a break for the between May or between The winter month. Over in May, they would they would give you a reduced rate just on electricity use usage. So it's kinda like what you're talking about because it's it's off peak, but rather than being daily off peak, it is seasonal off peak. So
[01:20:34] Unknown:
Usually, off peak is is either winter. I mean, if you're not in a place where most people are using electric heat, which I guess is a lot of Europe, or nighttime. Right? Nighttime, usually, electric usage goes down. People don't have their TVs on. Their ACs are turned to a higher temperature.
[01:20:50] Unknown:
They're under the blink. That's a sounder thing, though, too. It's, like, ACs here in here in Minnesota, your AC unit uses electric. So your the ace the overall AC cons or the electric consumption in the summer is way higher, whereas in the winter, nobody's running their air conditioning units. They're instead burning natural gas in their furnaces. So they want to try to balance that a little bit so they'll give you an incredible rate. All you have to do is call them if you live in a cold
[01:21:20] Unknown:
climate. Awesome. So, I mean, we nailed down power. I mean, power is is the most notable both infrastructures, thing you have to deal with and also, cost wise when you're trying to figure out, you know, what your bottom line is when you're running these miners, what your power cost is. The other two things you have with setup are managing heat and, Internet connection. I mean, the Internet connection is is fairly simple. You just you need an Ethernet. Obviously, latent connection, that's better, but it's not like a video game thing. I mean, you don't have to have the best Internet in the world. Right? Like, there's there's these guys running off grid with, like, bullshit cell Internet. I have,
[01:22:04] Unknown:
it's called an Orbi. It's I think it's a Netgear product. All of my miners run wirelessly. You you can't there is no Wi Fi unit in the miner itself, so it does still need to be plugged in with an Ethernet cord. But you just send those to a splitter, and then the splitter is connected to this wireless. They call it a mesh network, but, I mean, it's it's not. It's just like a really powerful, Wi Fi system. So as long as you're I think the furthest the furthest mine goes is close to a quarter mile. I still have Wi Fi on my phone when I'm driving. So and the latency is not an issue. I mean, I run security cameras.
I run, fuck, 20 minuteers. It's all fine. It all runs fine off of this one Orbi unit. I can take a picture of it later and send it out to people, but that's how I did it everywhere. Like so I only pay for, Internet in one condo, but it broadcasts Internet signal out to all the condos. And then at, at the other sites, same deal. We weren't gonna we weren't gonna trench a new Ethernet cord through the yards and through wherever, so you just run it run it off of the same. And as long as you're as long as you're plugging in Ethernet cords into this wireless
[01:23:42] Unknown:
router deal. So Wi Fi access point is the word you're looking for. There we go. Thank you. Yeah. It's basically just turns Wi Fi into Ethernet. The so we have Internet is is a is should be relatively easy, especially if it's a home miner. So the last two things are heat and noise. How should people go about managing that?
[01:24:07] Unknown:
My approach with the sound was to I I kinda took diverter's idea from the he had a, like, a Coleman cooler that he had the ASIC in. So I kinda took the idea of that enclosure, but I I made mine out of MDF and plywood. And then I I put 6 inch ductwork on either end so that I that I could still get adequate airflow through the enclosure. And and it didn't come out as good as I wanted, but I did attenuate the sound by 10 decibels, which which is actually, like, perceived by the human ear that sounds about half as loud, as it would without the enclosure. So, that came out pretty well. If if I were gonna do it again, I would recommend using fire rated materials just in case the ACIT catches on fire. You don't wanna just have it sitting inside a kindling box, but, that was my approach to the sound.
[01:25:10] Unknown:
Yeah. So the the sound, if you're not doing, immersion mining, which we can talk about, and I guess Neil can get into it a little bit more later since he's looking into it, Your sound is coming from your fans. Alright. When these fans, on your miter, depending on your design, the the watch miners are a single tube basic, so they have a single intake fan and a single, exhaust fan. The new generation, Bitmain and Miners are a dual tube ASIC, so they had 2 intake fans and 2 exhaust fans. But these fans are what create, your noise, and the entire purpose of those fans is to cool down the chips, is to keep your miner cool.
So what I did, and everybody kind of that I talked to about it kinda said I was crazy or stupid or I was gonna mess a minor up or whatever, but, I'm sitting here nearly 2 years on on this exact setup and haven't had a single problem. What I figure is if if these fans kick on to keep the miner cool, and that's where my noise comes from, well, then if I can just keep this miner as cool as possible, then those fans don't have to run very hard. The fans don't run very hard, the noise goes down. So I focus on getting cool air intake into my miner.
The way I solve that very, very simply and very, very crudely as with everything to do with my setup. It's extremely, trailer park, my setup is, is I I just shoot cool air from a window air conditioning unit through ductwork as talked about, and I I I shoot it into the miner. It keeps the miner extremely cool. Sometimes, a lot of time, actually, the window air conditioning unit is kind of a little bit louder than the miner itself, just because those fans are only running at about 3,000 RPMs or or even lower than that. So the point I'm getting at here is the cooler that you can keep your environment where your miner is at, the the lower, the sound output should be.
[01:27:30] Unknown:
Yeah. And then excuse me. And in a cooler, you can keep it the more static of an environment the miner itself is in. So then, therefore, you have the added benefit of like, I was talking about earlier. The miners like computers like a static environment. So you're you're keeping the airflow going through it at a pretty pretty reasonable rate.
[01:27:57] Unknown:
Right. And there's, there are 3 d printed, there there there are 3 d three d printed, how I'm blanking on the word.
[01:28:10] Unknown:
It's like a bezel.
[01:28:11] Unknown:
Yeah. What what that's that's absolutely not the word I was gonna say, but I'll tell you that.
[01:28:17] Unknown:
I know what you're talking about. Some of the clients have gone off with them. The ones that sent me already had them on. They were not a not a baffle, but, like, it connected directly into that tubing. It was, like, a separate size.
[01:28:32] Unknown:
And they use the screws right from the ASIC itself, so there's no, like, extra screws. There's no extra things you have to do. You can order these off eBay. I linked to them in mind for the streets for anybody interested. Yeah. Muffler. They're they're linked in there, though. So you can look in there and see, for cheap, you know, just a few dollars, you can, buy them and just take the screws out of the fans, put those on, and then throw your screws right back in there. And you can set up your ducting, so that you it it makes it much easier to get everything set up.
Yeah. So look into those.
[01:29:06] Unknown:
But, yeah, when you're talking about when you're talking about heat, so I was saying this condo, it's a 1000 1000 square foot condo, had 3 s nines and an m 32 running in the basement. The dead of winter, it was probably 0, 0 degrees Fahrenheit. Maybe it was close to negative 10 at times. I'd have windows open because it was just heating the place up so much. That's how much heat it was putting off. So just take that into account when you're when you're thinking about, like, okay. I'm gonna mine this in my garage in Arizona. 1 s nine is gonna make your Arizona garage unbearable depending on the ambient temperature outside.
Yeah.
[01:29:54] Unknown:
You've gotta get the hot air out. You've gotta get the hot air. Like I said, it's a very simple concept. The concept itself is extremely simple. Cool air in, hot air out. You know, I haven't really I haven't really,
[01:30:05] Unknown:
made up my made up my mind yet on what's more important because the cool air in will keep the miner quieter, but the warm air out, it's almost like individual thing. Your specific your specific situation determines that. But then that's why, again, like, me and my brother are working on this this immersion thing. We've we've looked into all the immersion setups there are and been screwed over on a few of them. And so we're just gonna build our own now. We just figured that, okay, nobody's nobody's gonna work with us in in the way that we would work with them. Like, they're not they're not making good on their end, so we're just gonna build our own.
So that eliminates and it kinda goes back to what I was talking about earlier. You can have 20 minuteers in your garage in Arizona then if you have one of these immersion setups and you put in the power to to maintain said setup. But, it gets rid of it gets rid of everything. Preserves the miner. It increases the longevity of the miner. You're eliminating noise because you're taking all the fans off. You're actually increasing its efficiency because the fans themselves are a drain. I think you increase the efficiency of the minor by, like, 15 or 20% just by taking the fans off, and then you dissipate the heat. You're gonna you're gonna lose a little bit of that efficiency on the other end because you have to now cool down that liquid. So if you have a dry cooler outside, that's gonna that's gonna cost you something to run, but those dry coolers were manufactured to be as efficient as possible for businesses and things like that.
So you're still saving on the efficiency. You're you're making your family sane again, and you can increase the size of your operation because you would never be able to do that otherwise given the constraints of everything else.
[01:32:21] Unknown:
Yeah. There's one guy just that I remember that I recall, talking about, you know, this this concept of individuals at home doing, immersion mining. Of course, there's a little bit more to immersion side of it than there is, you know, just buying a Coleman cooler and cutting a couple holes in it, which is what I literally did. But on Twitter, you guys can check out there's a there's a good thread and and information, by a guy, Evan Utstrand, evenutstrend@evenutstrand. And he he put out a really good thread showing how he had taken, a minor and set up an an immersion set up in his home. So that might be worth checking out for you.
[01:33:09] Unknown:
Yeah. You start to run into economies of scale, though. Like, the larger the the larger you can make your operation if you're running an immersion, the better off you are just because of the the capital expenditure that you have to you have to front load. Like because you have to buy all this stuff. You have to buy all the equipment to do it, the cooler, the plumbing, the heat exchangers, the tanks, everything like that. You don't necessarily wanna do that for 1 or 2 miners because it's all the it's it's all the cost with really none of the benefit.
[01:33:49] Unknown:
Whereas I tend to Go ahead. I tend to agree. I agree. I I don't I think immersion for individual minors is probably, a little much, personally. I I don't think that it's that necessary. And and as you said, for the for the added cost and, energy expenditure or time expenditure that you'd have to put into it, I personally feel like, you can if you put just even a part of that energy and time and money into, dealing with a simple air intake, and exhaust, you could probably come out with a with a really good setup. So, yeah, I tend to agree.
But, you know, having said that, the there like I said, there's a guy on Twitter you can check out. He has done it. Maybe ask him some questions. I'm sure he'd probably be willing to talk to you about it. Yeah. And I remember what I was gonna say earlier now actually about,
[01:34:42] Unknown:
it was it was way back. One of the earlier topics that we were on was, it's kind of the same concept as if you're a small miner, like and I'm talking you're not in an industrial mining farm. Efficiency of a miner isn't to me to me isn't necessarily as productive of a metric as price per terahash. Because when you're when you're paying a lower price per terahash for the miner itself, you're you're front loading your savings. Okay? So you have a less efficient machine, but you save $2,000 on the machine. The efficiency itself is going to take you years to recoup at a couple cents a day to get to to earn back that $2,000 that you saved initially.
And then you just throw that $2,000 that you saved initially into a little side account, and you just wait it out in case something bad happens. Like, that's where you get your money. You buy miners cheap, and that's where you get your money to float yourself through any bad times or anything like that. Like, rather than, okay, every day, I make 3¢ more out of efficiency than than I would have otherwise. I skipped topics. I went way back. Sorry about that. Back to the immersion thing now. Well, I mean, to
[01:36:18] Unknown:
to bring it back to immersion, I mean, you you mentioned on immersion there's some economies of scale there. There are a lot of economies of scale with mining in general, between negotiating power contracts and negotiating large hardware purchases. I mean, we talked about KaboomRacks earlier about how they require bulk buys a lot of the time. That's even more so if you're trying to go, you know, completely wholesale. But one aspect of a diseconomy of scale with mining is capturing that waste heat. Right? So if you're a miner in a in a cold environment, if you can find some use for that heat, you all of a sudden, you have an advantage that a larger miner doesn't have. Right?
[01:37:03] Unknown:
Yeah. Absolutely. And even even on a even on a, yeah, even on the most minute scale, like I was saying with the condos, I didn't have I didn't have any heating bills for an entire winter because you're capturing that heat just and that was just that was just increasing the ambient air temperature of a 1,000 square foot condo. So, I mean, you can you can use that in any way you want. And then with the immersion, you actually capture all of the heat. There is no there is no dispersed heat from it. It's all in the liquid. And then you use a plate exchanger to swap that out for in what in in our design is we're we're literally just swapping that out for glycol mixture, which we then dissipate outdoors during a cold during during a cold or hot season.
But you could use that same plate exchanger to swap that heat out into any type of mixture. The reason why we use a glycol is because it gets 0 degrees here or negative 20 degrees here. So we need the glycol to not freeze on us. Otherwise, we'd be running the dielectric fluid itself out to the pump. But if you're actually if you actually have a use for the heat, then you just instead of using the plate exchanger to swap the dielectric heat the dielectric fluid heat into a glycol that's going outdoors, you swap that in anything you want. Like, I was talking about in floor heating or your water heater, like, you'd mentioned, anything. Anything you need heat for. But the problem is is you need like, heat is you still need to use that heat. Like, if you have a water heater and you're swapping the heat out, that water heater is gonna get hot, and then you better be using a hell of a lot of hot water because, otherwise, that hot water heater is gonna keep getting hotter.
Like, you need you need some sort of way to continue to dissipate it. So, like, heating heating your backyard pool in the middle of winter, that might work because there might be enough volume of water there, and there might be enough surface area to dissipate that. But, I mean, you'd have to you'd have to be you'd have to do the calculations on that to see if you could even get rid of that amount of heat in that why I like
[01:39:34] Unknown:
that's why, like, specifically, I really like the idea of of, like, landlords getting into mining, you know, like, in 5 years or something. Because then if you have, like, a full building, I mean, that hot water is just constantly getting used.
[01:39:47] Unknown:
Yeah. Exactly. And then, well, for you for you particularly in New York, boilers. Right. The boiler is a far better use of because it's a constant heat, and it's circulating through radiators. And and the majority of New York apartments, I would assume, still have radiators. I don't know that for a fact. But
[01:40:11] Unknown:
You are correct.
[01:40:12] Unknown:
Okay. Yeah. There's a lot of things you can do with hot water. I mean, you could steam water even if you wanted to. You could keep pushing the same heat into the same boiler and
[01:40:22] Unknown:
whatever. Well, that's how, like, radiator boiler heat works. Right? Like, you just create steam. The steam rises through the pipes. It's actually kind of magically, magically simple kind of in the way that Bitcoin's magically simple, but, I mean, I'm kinda getting sidetracked. But it just the steam goes up, and then it collects, and it goes right back down the same pipe. It's just a single pipe that goes up to the apartment while you hear the clanking.
[01:40:46] Unknown:
Let me clank let me, hop on that real quick while you gave me an idea. So there is 2 definite different versions of immersion cooling. There is the one that I've been explaining that we're doing because it's simple, it's easy. It is you heat up the dielectric fluid. You swap the heat out of that fluid into a different fluid, which you can then utilize or disperse somewhere else. But then you have 2 phase dielectric fluid, which is, in my opinion, not a great solution for multiple reasons. Let me get in let me first explain what 2 phase dielectric fluid is, and then I'll tell you why. I don't think it's a very good idea. You've seen those you've seen those videos of of the boards themselves submerged in some liquid, and it's and each chip is constantly boiling off a gas.
And it's the fluid, and it's cooling the it's cooling the the chips on the board, but it's turning into a gas. So then you need, first of all, a closed system. Like, you need to actually, like, lock that down because you don't wanna lose that gas. That's a very expensive gas because it's your dielectric fluid. But then you also need a condenser to condense it back down. So those are those are 2 bad problems just to begin with. And then thirdly, I've heard, and it is my opinion as such, but I don't I haven't looked into it, so I don't know. But every single time one of those bubbles forms on the chip and closes down to boil off the liquid, that's a vacuum.
So that is not what I've been preaching this whole time about keeping your miner in a static environment. That's not a static environment. You're over the life of the miner, who knows how many times that it had a vacuum bubble around each chip, and then it closes back down on the chip? There's force to that. It might not seem like a big deal, but, I mean, if you're trying to if you're trying to extend the longevity of one of these things for 10 years, like, you don't want you don't want that extra trauma on it constantly, and you don't want you don't want it to go a split second without any cooling whatsoever. Because as soon as that bubble forms, it has no cooling actually touching the chip itself.
So that's just that it's a theory of mine. I haven't looked into it. It's just something that I've thought about. So there's 2 there's 2 definite different types of immersion cooling, and I think the one that we're going with is probably going to be the successor.
[01:43:36] Unknown:
I didn't realize there was that much to immersion cooling. I I thought it was just like heating up some liquid, running it through a radiator, and then putting it back in the tank. But it it's interesting to hear all the details.
[01:43:51] Unknown:
Oh, yeah. It's super fascinating. Every every every facet of it is that is is incredibly interesting. And so that again, going back to my brother, that's why that's why he's so been so instrumental to what I've been trying to do or what we've been trying to do is he gets he gets that type of stuff. Like, he understands flow rates and temperature swaps and things like that. So, like, I I was in a privileged position to begin with to even have a brother like that that's like, yeah. Let's do it. That's this is what we're doing now. And then, it really it really comes down to is it's crazy how bad the supply lines have be have become. Like, the only reason why we don't have a working prototype right now is because supply lines have completely gone to hell.
We can't even we can't even source a dry cooler. I've been looking everywhere, and thank God for the plebes. People been reaching out to me saying, hey. My brother might have a line on something like that. My brother works with something like this, or how about this guy? And, I mean, the the best lead I have so far is a, motorsports manufacturing company. He's like, yeah. We'll just we'll just design one for you. Give us the specs. So that's pretty crazy.
[01:45:19] Unknown:
Wow. I love that we have big corners everywhere in every single industry. Okay. So, I mean, this has been very insightful so far so far. I I guess I mean, unless Eco and Diverter have more questions for Neil on immersion, I mean, I guess the next question that, most freaks would ask is choosing your mining pool. How do they go about that? What are your thoughts there?
[01:45:48] Unknown:
I mean, I think all I think all 3 of us are mining with Slush Pool. Right?
[01:45:54] Unknown:
Yeah. I don't really see a reason why not to. I started for different reasons than what are my reasons now. I was actually I was actually, under the impression that originally, when I started, like because I didn't know anything about mining when I started. I thought that they were the only public mining pool that wasn't located in China. So I was like, well, that's an easy decision. Right. And then now my reason has completely changed. I don't see any other mining pools doing anything for the community or for, like, coming out with new firmware, like, flashing new firmware on your miners. That was I would never do that. I would never ever do that before Slushpool came out with the brains OS because nothing could be trusted. It was all foreign firmware that hasn't been tested at all, or the people that have had been using it. You don't know whether or not they're lying and they just work for the firmware people. And, like, firmware is a dangerous thing. You don't just put firmware on on something that means a lot to you, like a piece of equipment that means a lot to you. You don't just put random firmware on it because you're gonna get an extra t tear or ashes out of it.
So that was kinda that was kinda my take on that. And now now for me, it's like they've done more to give back to the Bitcoin community than, well, than any pool. I don't think any pool has done anything. That's kinda where I'll leave it, I guess.
[01:47:44] Unknown:
I found him from Diverter and Crazy k. They they had made the suggestion to try out Slush Pool and, you know, I I really like that they had a mobile app so I could monitor my a six performance while I was out of the house. And it was just really easy to set up. And I just kinda stuck with it. I I haven't had any reason to change.
[01:48:08] Unknown:
So when, when you're talking about mining pools, you know, it it's basically, the payout structure is a little bit different. I am on slush pool now, but, there have been plenty of times where, I I was mining with pooling. Slush pool, The way that they're designed, is basically to incentivize you to stay on slush pool, to not hop back and forth between, different mining pools because you get paid for the last number of shares since they found a block. I'm not gonna get into the whole payout structure that much, but the point is they try to keep you staying there instead of hopping around at different pools. Because as a miner, to change where you are mining at, I mean, to change what mining pool you're on is literally a single click, which is why, you know, you see people talk about, you know, there's x amount of percentage of, mining is being done in China, but what they were actually talking about was these mining pools.
That's that's not necessarily that's not mining in China. The machines aren't in China. Those were Chinese mining pools that people were pointing hash at. That could be changed with a click. Right. The thing about the thing about slush pool is, in general, when we're talking about Bitcoin and Bitcoin history, slush pull, in general, in my opinion, has been on what I would call the right side of Bitcoin history, throughout, you know, the different events in Bitcoin. So they've garnered a very high reputation in in the community for, you know, for for being that. Now it may be that your specific setup, you would rather have a a payout where you are guaranteed to get a set amount, depending on the number of, hashes that you provide, not depending on whether the pool actually finds a block. That's how slush pool is set up. You get paid when they find a block.
What I'll say to that though is over a long enough time scale I found in my personal experience over a over a time scale of, like, a week or 2 or or even a difficulty epoch, generally speaking, you're usually gonna come out about the same. You'll make about the same amount of money with a little bit of variation. The one thing I'll say about about pools, before we're going on is this is a region that I think, regulators haven't yet gotten to, but I believe they're coming for, probably in fairly short order. I'm of the opinion that, what we will see in the future is we will see regulators attempt to treat mining pools as money transmitters.
And the reason for that is if you set up mining on slush pool, what happens whenever you get, whenever you're mining and you're earning Bitcoin, that Bitcoin is actually going to Slush Pool. That's not going directly into your wallet. Alright? And then once you hit a certain payout threshold, whatever you set that threshold at, whether it's point 1 or whatever the case may be, once you hit that threshold, then slush pull transfers you, the amount of Bitcoin that you've earned. So what I believe is regulators will make a move on that front. They will attempt to classify mining pools as money transmitters, and then what they will attempt to do is force mining pools to institute KYC for, anybody hook hooking up to their pool. Because as it stands right now, you don't have to do anything. You just you can just create an account with an email or whatever. Sometimes you don't even need that. You can just you can do it in an anonymous mode, like Luxor pool, anonymously, all that.
So, it's very simple. But what I believe KYC is coming to mining pools, in my opinion. Could be wrong. So one pool that it doesn't get talked about very much, but, that I think their payout structure in the future will become more and more important is, and I'm gonna probably pronounce this wrong, Laurentia Pool Laurentia Pool. However it's pronounced. Laurentia. It's a Mind Farm Buy. It's the pool that, he is involved with. And the reason that that's different is they pay out direct from the Coinbase. Alright? It's a direct from Coinbase payout. So there is no custody, that you're when you're mining, you don't mine to the rent your pool and then they transfer it to you.
This is a a when when you get a payout from a block reward, the Coinbase payout itself actually pays the miners. So I think that's gonna be very important. Right now, I'm not mining with them, for a few reasons. One of those being that the miner that I use, I run s 17 pro 50 terahash models. Those are the miners that I run. I can't hook up to that mining pool just because of a technical hookup situation. But the point I'm getting at is, I feel like this is a payout structure that I think we'll see more pools either be forced to move to or, implement KYC on their miners. I believe that's coming.
[01:53:29] Unknown:
So I think, my take on that I I I agree with you 100%, of course. But the the Stratum V2 the Stratum V2, I haven't looked into it enough to speak on it fully, but my understanding of it is that it allows individual miners to construct their own blocks. So then therefore and that's something Slushpool is working on right now. So why wouldn't I pay my why wouldn't I pay my minor fees to a pool that is actively working to basically make themselves obsolete? Like, they must have some sort of business plan for the future, whereas they they see a different way to financialize the mining pool market.
Because once that happens, then all transactions get paid out to my understanding of it. Correct me if I'm wrong.
[01:54:27] Unknown:
Let me just jump in here real quick. First of all, Laurentia Pool, I also probably pronounced it wrong, is a really cool concept. Major negative with Laurentia Pool is that no one knows how to pronounce it. I mean, I I love your mind farm by, but, to work on an easier name. I I will put the link in the show notes. For the video freaks, I put the link, directly in the video feed. The 2 main trade offs of of Laurentia Pool right now is, first of all, the the hash is low. So if you have a lower hash, oh, turns out that I pronounced it correctly. Fuck yes. We have Mind Farm Buy in the chat right now. The the payout is less.
You have more variance. Right? So the amount that if on a long term basis, when you're talking about a smaller hash pool, and you gotta start somewhere, obviously, you have more variance. So, your payouts are a longer time between payouts, but on a long time scale, it should even out. And then the second issue with, Coinbase payouts is obviously, you're paying, you're paying more in minor fees. Right? Because you're gonna get a lot of small payouts instead of 1 large payout. I also share their fears with Diverter. The one thing we have going for us is that it is easier to, you know, operate a mining pool in some jurisdiction somewhere that is not enforcing it, at at minimal switching costs as compared to actually moving miners around, moving hardware around.
So, hopefully, we'll have some kind of regular regulatory arbitrage. In the the meanwhile, right now with most pools, what you give them is an email address, which obviously could be a burner, and and they know your IP address if you don't use a VPN. So, I mean, I I think if privacy is your concern, you probably should be running everything through a VPN. To Neil's, comment about Stratum v 2, Stratum v 2 doesn't solve this specific, concern. Stratum v 2, the idea is right now, mining pool operators construct the blocks. They decide what transactions go on a block. With STRATAM v 2, the individual miners decide what what happens in a block, what what transactions get included in a block. So it gives us some censorship resistance in terms of taking away power from, you know, 5 or 6 mining pool operators, large mining pool operators, but the the payouts are still a custodial payout. It still goes to the mining pool operator, and then it goes out separate. I mean, they could obviously do a Coinbase payout just like, Laurentia does, but, but that's not necessarily in the spec. That's separate.
[01:57:03] Unknown:
Yeah. I I I really do think this is something that's gonna matter later, and it's gonna as you as you, alluded to there, it's a a lot of this is gonna be dependent on whether or not, pool operators are, willing to be defiant, which is the case with so much of Bitcoin. You know, right now, we're in a very permissive environment. Even, you know, with the things we're seeing in China and stuff like that, overall, this is we are not anywhere near an adversarial environment yet. The fight is just beginning. And it's gonna take, people that are willing to disobey, willing to not comply, willing to use things like regulatory arbitrage or willing to implement different payout structures. All these things are are are a necessity. It's a necessary part of, in my opinion, of Bitcoin and of being a Bitcoiner.
So, you know, just it's it's something to think about. It's not it's not a problem today. Probably won't be a problem for, you know, a little bit of time to come, but, yeah, I you know, I believe, every pool should be working on, were payout structure where this can be avoided. Because what what I don't want to see is KYC to hook up to a pool. That is that is a death knell.
[01:58:21] Unknown:
So another thing another another reason why like, this this most recent upgrade to slush pool is so you can't do the same payout threshold that you're talking about where where it hits a well, you still can. You still can. Like, okay. So you get to a 1,000,000 sats, and it'll payout to a wallet. The newest the newest upgrade that they just did is you can have several people, several several Bitcoin addresses.
[01:58:52] Unknown:
Excuse me.
[01:58:54] Unknown:
And you can pay out over time. So our our electric bills show up at the exact same time. But instead, now anyone anyone who's involved with anything I have going on, I get to allocate to them whatever percentage they're they've earned from whatever it is that I'm doing. And then the onus is on them to pay me the fiat bill to pay that electric. Like so I'm not so it works out so great for me, and what I have going on is, like, they don't they don't have any concerns anymore. Like, it's paying Bitcoin directly to them, and then they will owe me for the fiat bill. Whether they need to sell their Bitcoin to cover that fiat bill or not is up to them. I don't have to know about it. It's not me juggling. Okay. Well, we made this this amount of Bitcoin at this price at this time, but on 15th, our electric bill is due, so I have to calculate your your percentage of this bill given that it it it eliminates a lot of the volatility for them. Like, they're just getting the Bitcoin that we earned, and they're paying the bill however they wanna pay the bill. Whereas before, when it was just a denominated, okay, every 1,000,000 sats, it pays out to this address, and then now I have to divide that and figure out what the price of Bitcoin is today and the price of your electric in Bitcoin terms is subtract that from that and then pay that. Like, nobody wants that. They're they're mining because they want the Bitcoin. They'll pay the cash for the Bitcoin. They don't care.
Does that make sense?
[02:00:49] Unknown:
Yeah. It totally makes sense. Slushpool's new structure is it adds a lot of flexibility for mining operators. So I I was really happy to see their upgrade. And, you know, there's a just from a privacy standpoint, you know, I I personally have decided to, and and I recommend other people don't reuse addresses to receive mining rewards to, you know, specifically for some of the reasons Diverter was alluding to. You know, if that pool operator wallet becomes a choke point and they're watching the funds that go out of that pool operator's wallet to your personal wallet, you know, that that can be a problem. And one thing you can do to alleviate that is to take your mining rewards and run them through Whirlpool, and then that coin join will break that deterministic link from the pool operator's wallet.
And so if anyone's watching the pool's operator the pool operator's wallet and tracking those funds and it goes through a coin joint, then they're not gonna be able to trace it after that. And then on the other side of the coin join too, when you go to spend your mining rewards however you want, whoever you spend them with will not know that you're mining Bitcoin in case that's something you wanted to keep private.
[02:02:21] Unknown:
So Go ahead. That's a very good point. I I I assume most freaks listened to the last week's dispatch, which was with Samurai Wallet of, Samurai Wallet, one of the cofounders of Samurai Wallet. And we go deep into Whirlpool. I mean, I think Whirlpool should be in the standard toolkit of all Bitcoiners, but it including miners. I just wanted to make, just a quick correction or, clarification. So we're talking about Laurentia Pool earlier, and they pay directly from the Coinbase. That's not the exchange. The the exchange borrowed the term that was a Bitcoin term already. The Coinbase is the first transaction in a block. It's what, the miners construct. It can only be created by the miners. It's the miners paying themselves out. So when I talk about increased fee burden, you actually don't have a fee for the the payout, which is nice. But at some point, you're gonna have to consolidate those small transactions in the future, and then I ideally run them through Whirlpool.
At that point, you're gonna pay a higher transaction fee because the more in general, the more inputs you have in the transaction, the higher your transaction fee. Now I've been wrong about a sustained high fee environment happening. I mean, as you can see today, there was, like, a panic sell, and even that barely moved the mempools. You can still get very low fee transactions, and so it's it's more feasible in a low fee transaction environment. If we have a higher fee transaction environment, that could become an issue because it's gonna affect miner's bottom lines.
[02:03:59] Unknown:
Yeah. Let me think if I can remember the idea that we were talking about the other day. So I wanted to know what the percentage of lightning closes as a fee as a fee percentages on main chain. I was curious about that. I don't know if anyone's closing Lightning Channels right now, But there was this theory that that has blocked subsidy, which I don't subscribe to. I don't given given the trajectory of the iPhone, I don't think anyone could predict what Bitcoin's going to do in 10 years. But there is this theory of when the block subsidy declines, then the fee market may not have developed adequately enough to sustain minors.
So I I I'm kinda a buddy of mine reached out to me, showed me some numbers and stuff. I've just been too busy to look at it, but what do you guys think about that?
[02:05:06] Unknown:
Well, this is one of the things where I was kinda talking about earlier that, you know, relying on altruism is not a a a business model. However, I think there are situations where, especially things some of the things that are being explored right now where it could be that, people are mining not only just for the Bitcoin, reward itself, but for, other purposes such as, to handle flared gas, for example, just first example off the top of my head. So these oil and gas pro producers, they need to take care of this flared gas. Now right now, they you know, it can be done and they could turn a profit and do all the and do all sorts of things. But even if that weren't necessarily profitable, there still could be an incentive there for them to mine because it's a very easy way for them to deal with this flare gas, and and it could still eventually save them money.
So the point that I'm getting at is this network right now is probably over secured. Like, we we don't need this much has to actually secure the network. In a worst case scenario where there is just no fee market has developed, I believe that users can, would just simply end up waiting for, more confirmations. I believe there would be people mining out here that are mining for various reasons. The more that we can get it dispersed into individuals that are looking at this as a DCA mechanism or, you know, any sort of process like that where we further decentralize so that we're not reliant on profit driven huge farms.
I think that's a net win. I don't see it as being an issue personally, but even at looking at a worst case scenario, I still feel like there's areas where people will still be mining even if they weren't necessarily profitable.
[02:07:06] Unknown:
I mean, I'm also hopeful besides, you know, lightning open and closes. I I think, I think CoinJoin represents a base demand, like a reserve demand for a fee space. So, hopefully, if we see coin join usage go up and if every spend is a coin join I mean, when we say every spend is a coin join, it's obviously an optimistic goal, but if a large amount spends are a coin joint, it should increase, fees as well.
[02:07:31] Unknown:
But what if what if there's some and it goes back in my same thing. Nobody could predict anything that's gonna happen in 10 years because it's just simply impossible. But what if what if there is a main chain privacy improvement where coin joins are unnecessary, then you're not gonna have that that base layer fee protection. And I think I think Lightning is gonna accelerate to the point that Lightning channel closes will be, at some point, the the majority of the reward. The subsidy will decline, and I usually don't I usually don't try to speculate out that far in the future. But, I mean, we already saw we already saw 9 Bitcoin block rewards.
And so you're talking 3 bit 3 Bitcoin of that would or, yeah, 3 Bitcoin of that was or a little less than 3 Bitcoin of that was fees. And I don't I I just wanna know how much what percentage of those fees was lightning.
[02:08:42] Unknown:
And now I know that people work At the end of the day at the end of the day, you know, first of all, one of the main advantages of using Lightning is reduced fees, because it's it's basically, Lightning is a batched Bitcoin transaction, a large amount of small transactions that are batched into a single open close. If if if fees are low, then there'll be less demand for lightning. So it's kind of like, it it's more of like a pressure valve, like an escape valve is kind of how I look at it. But, regardless, look, at the end of the day, I think we're all here because we want to see sovereign Bitcoin usage increase.
And I I think if if adoption increases and and demand for main chain Bitcoin doesn't increase, whether that's lightning open and closes, whether that's coin joins, whether that's regular on chain transactions, whether it's miner payouts itself, or, like, the res the transaction after the minor payout if they're coming in through a Coinbase transaction, then we have bigger problems on our hands. Like, I I think, you know, block space is scarce. Demand should increase. On top of all of that, with adoption, price should go up as well. So once that per byte transaction, even if they are confirming at whatever point in the future, should have more purchasing power,
[02:10:00] Unknown:
You know? It's yet to be seen. This is all speculation. Right? Absolutely. Absolutely. And goes right back to my my original point was you can't you can't predict what it's gonna look like because you just there's no way to know.
[02:10:14] Unknown:
Right. Like, I mean, if if the last year has been evidence of that.
[02:10:19] Unknown:
Sorry.
[02:10:20] Unknown:
Continue. No. I was just saying the last year has been evidence of that. Like, when I pulled the trigger on deciding to mine, I was planning on losing 71¢ a day. And now here I am mining Bitcoin for 80% below spot price.
[02:10:35] Unknown:
Right. It's just been a a wild year, and you never know what the road ahead has. And none of us could've seen that coming. We never could've seen that coming. And if you look at, like, if you look at the block subsidy, right, so the part the part of the reward that's not, transaction fees, that obviously halves every 4 years. But where we stand today, it's significantly more than in the last epoch just because the Bitcoin price has increased significantly. The purchasing power of Bitcoin and we say Bitcoin price because we measure it against USD, but, really, what you're measuring it against is labor cost, bread cost, meat cost, real costs, like, actual purchasing power. That purchasing power of that subsidy has increased even though the actual Bitcoin denominated subsidy has decreased.
We've gotten a little bit sidetracked, even though I love this conversation, the freaks have heard a lot of mempool talk, especially since I completely took cake to my face in terms of of our current mempool environment. And I will own that probably every every dispatch until it changes. That's one of the reasons why we stream the live view of the mempools in dispatch is is because I think it's a very good timeline of where we're at. I wanna talk about and I think this is what a lot of freaks are are are gonna be asking at this point. We're 2 hours in. Maybe they're feeling a little bit overwhelmed. Maybe they think their power cost is prohibitively expensive. There's a new crop of Bitcoin mining in this hosted mining. This idea that another company, you know, has custody of your miner and hosts it at some kind of hosting facility for you at a lower power cost and pays you out.
The most famous and successful one being Compass Mining. I'm curious what your guys' opinion is on those trade offs, and is is that something that people should consider?
[02:12:29] Unknown:
Yeah. So I, I alluded to this very briefly in in Mining for the Streets, because the, you know, the fact of the matter is not everyone, has an electricity rate that would allow them, to mine Bitcoin. It just does it. Even even if you are willing to to take, a certain amount of loss, there comes a point where it's just it's just not feasible, or your structure is just not feasible. So there in the past, you know, what we've talked about or what's been advertised around is as you spoke about earlier, cloud mining, which in my opinion is basically a complete and total scan. Don't do cloud mining. It it sucks.
What hosted mining really is, it's it's not cloud mining. It's a different thing. Okay? So you buy a machine. It is yours. You own the machine. Now you have nowhere to actually run that machine, so you send it to a company or you can buy it from them, whatever. They actually physically host the machine, but yet it mines Bitcoin and the payout comes to you. Now, obviously, the very first trade off is not your miner, not your hash. Right? You don't have the mining machine. So what's to stop them from just leaving, taking your machine from not paying you?
All these things come into play, and they're absolutely 100% valid concerns. What I talked about in mining for the streets, was and the experience, I relied on a little bit of anecdotal personal experience with, a guy that I deal with, Crazy Kaye, who's one of the, Ronan guys. He actually won, a a a watch miner. I believe it was an m 30 or I believe it was m 30. He won it in a Twitter giveaway. Like, they actually they just gave it to him, but he couldn't mind. He didn't have anywhere to to be able to put it in his home to where he wouldn't have to, trade in his wife.
[02:14:37] Unknown:
So,
[02:14:39] Unknown:
he he chose the wife, You know, bad you know, we all make bad decisions, I guess, but he chose the wife. And no. Don't don't trade in your wife for minors. Don't do that. But, you know, he his whole thing was, you know, I I he wanted to mine. He wanted to mine Bitcoin. He wanted to earn Bitcoin without having to do full KYC. So he went with a hosting solution. Now the one that he went with is one that's been around for a little while. Compass, I don't know them. They're a little bit newer than Blockware, I believe. What he went with was Blockware Solutions. They had a facility that was hosted in Kentucky.
They offered him, sub 7¢ electricity rate. Now the way that worked is whenever he sent them a machine, he in turn received a full legal contract. Alright? So when he filled out this full legal contract with this company to where, they essentially relieve themselves of all, liability, which as far as, you know, problems with the machine and things of that nature. But he also, you know, was receiving, legal protection from them actually just running off with his machine. So, of course, obviously, if you don't own the miner, if you're if you're putting the miner in somebody else's facility, obviously, that's a massive trade off, and it may be one that you're not willing to make. Fine. But if you're in a situation where you absolutely cannot mine in your home, the biggest thing is what I put in there, don't skimp on reputation to get a little bit of a cheaper, cost.
Because what's gonna happen is, these machines are not cheap. We're talking about, you know, upwards of $10 a piece for one of these machines. So if you send a $10,000 piece of equipment to somebody that you've never seen, never shook their hand, never been in their facility, you know, that that that's a big risk. It's also a risk that, you know, whatever happens, maybe they get raided by somebody. Maybe somebody shuts them down. Maybe they get break in. There's all these risks, but it is a valid, thought process to go through. It's it's a valid option in certain scenarios. I just would highly encourage anyone that can find at home to do so. But if you absolutely can't and you're gonna go with a hosting solution, go with one that has a solid reputation that gives you a legal contract that protects you and protects loss of your machine, and that's the best you can hope for.
[02:17:29] Unknown:
Yeah. I totally agree. I mean, the I I I see the problem that Compass solves. Like, there's there's multiple there's multiple problems that they solve, being whether the heat, the noise, the electricity rate, the electricity availability. Like, that's that those are those are what we've made this whole podcast about today is those are the issues with mining. So if that's not if if even one of those is too much for you to handle, then I understand why you would want to mine, but it's it's counterparty risk. At all times, it's counterparty risk, and you're taking a you're you're essentially taking on the exact same reason or the exact same risk that I personally wasn't willing to do with lending Bitcoin.
Because you're lending them your miner. You're paying them you're paying them a rate to to get all those benefits. You're paying them something. It it's a hosting fee. You're essentially renting from them. And I'm not saying it's a bad idea because I don't know. I really don't. But all I'm saying is that I I was in a privileged position to if you don't wanna do any work to to figure out solutions to your own personal getting into mining, it's a very good solution. And you may you may luck out and you make more money than you spent on the miner over a certain ROI time, and then you're sitting on a bunch of Bitcoin, you're mining it for free. And then if if you get rug pulled or something, we've just seen so many rug pulls in this industry that you don't know what is viable and what isn't.
And the hosting thing seems to be kind of a newer type thing. I don't know. I haven't looked into it real closely. But So And like I said, I go ahead.
[02:19:50] Unknown:
Well, I'm just gonna say what what what were you what I got into this for, what you kinda left me just got into this for. I think you to a certain extent as well. We're looking for KYC free Bitcoin. Right? So, which is what we kind of we're talking about here. There's a very important distinction to make here because KYC the term KYC has has become, it's starting to be used now as just a catchall sort of phrase, for any sort of, you know, identity. You know, like, if you have to hand over any of your identity where you did k y that that's k y c. Alright? That's not actually technically the truth. Okay? But, one of the comments I see in here is saying doesn't hosting solution because of the the legality, doesn't that remove the KYC free rewards? So what's the point? Valid question. Right? Valid question.
However, there is a massive difference between doing actual KYC AML regulations and and this particular setup. The difference is when you do KYC, what you do when you go to this exchange, you fill out all this information, you give over all of your personal details to an actual Bitcoin exchange, a financial institution that has an obligation to have all this all of this stuff on file, so that it can be picked by whatever authorities wanna pick from it. Don't even need a warrant, so it's awesome. Whenever you're dealing with one of these hosting solutions, it's that's not the same thing that you're doing. You're not putting your information on a readily available, easily scraped database by whatever agency wants to scrape it, to gather all this information about you.
Now that's not to say that this hosting company doesn't have a legal obligation to hand over whatever information they give if pressed for it. I'm sure that they would. I'm I'm I'm sure that, you know, when push came to shove, your your identity the fact that you're, you have a minor hosted there, it that that's a very good possibility. But it's not the same thing as doing KYC. Right? You're not just
[02:21:59] Unknown:
immediately dumping into it. So You do you do, though. You you do like our boy, FTB, says, he says that there's there's a decently anonymous way to do it where you register with them, you pay them in Bitcoin, you use a burner email, all of the above, all the all the proper precautions to do so. But then you run into the other the other hurdle is if something does happen, now you have no assurances because how are you gonna prove anything to the to to them? If you haven't properly KYC'd, they can say that your machine like, one of their machines could go down. Like, one of the ones that they're hosting for themselves goes down or something happens to it or whatever, and that's not their machine anymore. That's your machine.
[02:22:56] Unknown:
Right. But but that's what I'm saying. The point that I'm getting at is is that's not actually KYC.
[02:23:04] Unknown:
No. But if he's lying about it, he has no claim. Like, you were saying that they had some insurance insurance assurances or something like that, but you can't collect on that if you lied about your identity.
[02:23:15] Unknown:
I'm not even talking about lying. I'm just saying KYC the term KYC is being used as a blanket term to just blanket, describe, you know, any sort of identity. So it's I I think it's important to distinct to to to make a distinction between what is actually doing KYC, which is handing over your selfie and your ID and all that stuff to an to a a a financial institution and exchange. That's one thing. That is KYC. This other thing is not we're calling it KYC. It's actually not. However, as you as you point out, when push comes to shove, your yes. Absolutely. Your identity, if you if you, give yourself some sort of legal protection from this company, they will hand over all of your information to authorities. It's not like they're not going to. The point I'm making is that's not sitting on a an actual KYC database like it is at an exchange.
It's not the same thing. So there's a level of separation between where your identity is sitting and these regulators or or agencies that may be interested in trying to deanonymize you. So there is a a level of, of protection, but that will immediately dissolve if they're pressed on it. The problem the the thing the thing is they have to be pressed first in this situation. I 100% agree with what you're saying. Yeah. Yeah. That's right.
[02:24:45] Unknown:
You just Oh, now either
[02:24:47] Unknown:
go ahead. I want I want one thing I I I will say, I don't wanna give too much away here because, you know, this is something that I I I am literally actively working on myself. But I I I hope to, alleviate this within the next few months. I am actively working on a solution that I believe, is tailor made for individuals looking for privacy that also want some sort of protection for their machines for a hosting facility. So I'm working on something. I hope hopefully, it it'll work out. I can't get too much of it but understand. I I see the problem. I understand the problem, and I'm I actually I am working on,
[02:25:30] Unknown:
bringing a solution to market. Yeah. I am too. I'm, 4 months into it right now. I'm not in competition with you. That's the sweet thing about miners. It's kinda the same thing about Bitcoin holders is you don't like, you're actively trying to get your friends and family and randoms on the Internet to buy Bitcoin in competition with you because you want more Bitcoin. And it's the same thing with mining, is you're actively trying to get basically, you're you're you're trying to orange pill your own competition. Like, you want more people to have miners because they're like minded people.
So
[02:26:14] Unknown:
Sure. And I and I don't want anybody to to to walk away from this thinking that I'm advocating for, hosting or certainly not for for KYC. I just think it's important that we understand that everybody is in a different situation. This is a very personalized thing. And there are trade offs that some of which are completely and wholly unacceptable, some of which may hurt a little bit, but you're willing to make them depending on your situation. So all I'm saying is cloud mining, scam. Don't do it. Hosted facilities, be very, very, very picky with who you use for a hosted facility if you choose to do it. Like, extremely picky.
Vet them as much as you can. Make sure that their reputation is strong. Make sure that you get the protection that you need.
[02:27:05] Unknown:
But at the end of the day, if you can, just mind at home. And I know I know I know plenty of people. And like I what I originally said is I understand what the hosting what the hosting offers to people. I understand the problem that it solves for people. And all the questions that, from the people that I know that do it, I've asked them questions because that's the only way I can get information about it. And, like, they gave you the serial number of the machine. They they do they they do put in place some level of security so that you know that you're not getting totally wrecked. But 3rd party is a third party. You can never you can never truly trust someone that you've never been with.
[02:27:59] Unknown:
Eco Eco, host our miners for us.
[02:28:02] Unknown:
You know, if I had more than 200 amps to my house, I might consider it. But We're buying next stop.
[02:28:10] Unknown:
Start leasing some subways out. There's a pizza joint that I've been looking at. They have electric pizza ovens. Place is a total disaster. 170,000. Just thinking about it, but the guy was a dick, so I told him I wasn't interested.
[02:28:26] Unknown:
You know, I I think you guys have, like, a a very level headed perspective on on hosted mining. You know, I I'm a self custody maximalist and a do it yourselfer. So, you know, I I I believe there there are no problems. There's only solutions. And you can find a solution to heat and air ventilation and noise, and electricity in your own home, and you can get basic and do it yourself. But, you know, I think everything you guys have said about hosting is valid. I think you've outlined the risks very well. And, you know, for those people out there that really wanna mine but just really can't do it at home, you know, I I think you guys have spelled out a good case where hosted mining can be a solution.
[02:29:21] Unknown:
I agree. I would rather I would rather buy a miner, me personally. Like, I'm in a privileged position where I don't have to do so, but I would rather I would prefer buying a minor with a company like Compass and having them host it for me for a fee, then I would blindly handing my coins over to a lending service where what they're actually doing with the with that coin is so opaque that you don't even you don't even know how your money is being used. Like, they don't know you don't know what why you're getting that yield. They don't even tell you. They don't even tell you what assets they hold or anything, and that's that's insane to me. At least at least you know the structure of a company like Compass.
[02:30:13] Unknown:
And one of the things I I wanna point out too, I don't know about Compass. Like I said, I I don't know anything about them. The only thing that I do know a little bit about is Blockware Solutions. Like I said, that's only because, of Crazy Kay, which I've talked with. Like I said, he's one of the Ronan guys. He's had a he had a a couple of ASICs with them for over a year. He never had a problem. So one of the things that they do though is they give you VPN access to your miner. Okay? So it's not like you just just, you know, throw this machine in there and then you just hope you get a payout in your wallet later. You have VPN access to the miner. So, in the case of Blockware Solutions anyway, and he's able to choose whatever pool he wants to mine on. So he you know, if he wants to mine on slash pool, it's no it's it works the same way. He has full VPS control, of where his hash is getting pointed. So you don't have to mine with their pool or anything like that in the case of of blockware. So, again, that's one more thing where it's a little it's not quite just blind trust. It's not like cloud mining where you just hope that they send you a payout after a certain amount of time. Like, you do have some sort of aspect of control over your hash. You just don't have the physical access to the device. So, again, massive trade off, but that's not to say it should be fully discounted.
[02:31:32] Unknown:
No. I agree. I agree. There is, no. And that's the same way compass mine compass mining works too is from the people that I talked to is you get to point your hash rate at whatever pool you want. They're just running it, and they're running it at a fee.
[02:31:49] Unknown:
But
[02:31:53] Unknown:
but the 3rd party hosting thing is always what I'm worried about is because if they can prove any type of, like so the whole new like, I was talking earlier, you can you can use miners as collateral against the loan. You don't know that they're not doing exactly that. They might be leveraging your miner because it's an asset on their balance sheet because they're in possession of it, and it's a liability on your side. So, I mean, they get margin called. All those miners might be you don't you just don't know the funky business that might happen. It's the same thing with GBTC or anything else. Nobody nothing nothing is out on the table. You don't know what anyone's doing with your assets.
And if they're your and I and and again, I'll go back to saying, I don't think that compass mining is a bad idea. It's I see the problems that they solve, and it is it is legitimate problems for most people. I just I'm in I'm in a position where I don't need to deal with that, so I haven't looked that much into it. So maybe my take is even bad on it. I'll I'll admit that. Well, I mean, I mean, look. Trusted third parties are security holes point blank period. That's been established. We know this.
[02:33:14] Unknown:
So it's just a matter of whether or not this particular third party, has done enough, to garner enough reputation to allow you to put a level of trust in them. And, you know, like I said, I hope to be bringing something in the market to actually deal with the identity portion of this in the future so that people are concerned about KYC, that that want some sort of protection but don't want to hang over their identity. It can be done. I just need a little bit more work on it, but it's it's I'm I'm gonna get it done. So look forward to that.
[02:33:51] Unknown:
Attaboy. That's exciting.
[02:33:57] Unknown:
I mean, I think I think that was a pretty great discussion on the trade offs. It's counterparty risk like anything else, and, you have to decide if your if whatever your current situation is, how how you wanna handle that risk and if that risk is worth it to you. But I would say, like other custodians in the Bitcoin space, just because they might not formally be KYC currently, you always run the risk that there's a shotgun KYC moment if they're holding whether that's your Bitcoin or your hardware. And and that that can happen quicker than people expect. I mean, we we saw we've seen it happen a 1000000 different times with, Bitcoin custodians. Absolutely. Binance being the most recent example.
Yep.
[02:34:51] Unknown:
Yeah. Go ahead. Can I can I hit this one little question here that you It's talking about how about, mining shitcoins on a general purpose computer that's already present in your home and then dumping them for Bitcoin? I mean, I'll probably get canceled for saying this, but sure. Why not? You know, the whole point of this game is to accumulate Bitcoin, if I'm not mistaken. So, if you have a a general purpose GPU or even a CPU that you're able to mine, you know, some shitcoin that you care nothing about and instantly dump for Bitcoin without having to do KYC in order to do so, then, I mean, what are we talking about? Fire it up. What I'll say though is, a lot of the times, that's not really that true. Like, a a regular normal CPU or GPU that you've got sitting in your normal laptop is probably not actually gonna do anything other than heat up your computer a whole lot and not really earn much.
So what you'll end up doing is spending a a few 100 or even a few $1,000 in building out a GPU or CPU to, you you know, to mine something when, I mean, you know, buy an AC. Spend that, buddy. Get an s 9 or an s 17 or an m 31 or m 20 and and, you know, just go directly to Bitcoin. But, that's, you know, that's something. And there's a miner that came out a few a little while back. It was called a coin mine. What's the name of it? Coin Mine 1. I, First of all, I don't don't get it. It's terrible. But their their their entire, their entire selling point was this is a miner that you can just plug in and leave on your countertop.
Alright? And you can have it sitting in your in your home just just on a coffee table. It looks just like, you know, like an Xbox or something, and you can just leave it sitting there and you'll be mining Bitcoin and you'll be contributing to the network. That's this is their whole spiel. Right? You contribute to the network, you'll mine Bitcoin. When in reality, you can literally never ROI with a coin mine ever. Like, no matter you cannot do it. And what they're doing is they're trying to, like you have to you can mine, like, Grin or just some other just the worst worst of the worst shit coins.
And then they'll try to transfer that to Bitcoin and and, you know, make you feel like you're mining Bitcoin at home, and you're doing so with the machine that, you know, you can talk about at a party. Like, it's a good conversation starter. No. It's it's horrible. You can never know why. But in my opinion, there's a massive market share here that's not being addressed yet that I believe ASIC manufacturers in the future may do where they actually target a home miner. And they proceed and they succeed
[02:37:49] Unknown:
Oh, sorry. I didn't mean you're That's alright. Go ahead. Oh, well well, we see some of our friends. Right? Like, Matt Odell is actually the only one left out of the chat that that we shared together, and we see some of our buddies doing exactly that. They they're they're mining shit coins and insta converting them. It's, essentially, it's a speculative attack against the shitcoin. It drives the price of Bitcoin up because they're mining shitcoins, and then they're selling the shit coin to drive the price down on the on the coin that they're mining and drive the price of Bitcoin up.
But everyone has a hard time against them because they are, quote, supporting the network.
[02:38:43] Unknown:
Yeah. Well, if I could just jump in here real quick. I mean, first of all, I'll I'll reiterate what Diverter said. I mean, CoinMine is extremely overpriced, and they put it in a, like, a super classy package or whatever, and they they get sponsorship deals on big podcasts to sell it. But it it was extremely overpriced. I do agree that there's a place for a home miner. As far as mining shitcoins and dumping them for Bitcoin, auto dumping them for Bitcoin, I don't think I mean, diverted you said in the beginning, I might get canceled for this. I mean, I think that aligns pretty strongly with Bitcoin in that you're providing auto sell pressure on the shit coin, and you're providing auto buy pressure on the Bitcoin.
And one of the nice things about it is you if you do have a gaming computer at home, you can just use that already. You already have that. It's general purpose hardware. To go out and buy a purpose built overpriced machine to do that is a whole another story that doesn't make sense. Can you hear me again? Yes. Sorry.
[02:39:48] Unknown:
Yeah. No. To to back to my point is these guys that we know that are doing this are buying Alienware machines that are essentially purpose built to do exactly this. They're they're super fast. Everything about them is great for doing this. And they're still essentially money at a loss, but they're being subsidized because the machine themselves is under a 1 year warranty. You can cook the machine. You can just cook it. You can crank it up as high as you want, destroy the machine, and then you get it replaced at the end. And then when the new one shows up in a box, you say, alright. This game is over. I'm just gonna resell it brand new in the box. So there's a whole different dichotomy of what else is going on. Like, they might be speculatively attacking that particular chain that they're on and making Bitcoin out of it, But when all is said and done, the hardware cost has done nothing.
I hope I didn't give away too much, but don't do that. It's dumb. You're gonna get caught with your pants down.
[02:41:08] Unknown:
Yeah. I mean, the the whole the whole idea here is that, we want people to be able to, you know, directly mine Bitcoin and to be able to earn, in a way that they don't have to give over too much of their identity and with that with too much third party counterparty risk. That's the whole goal. Now there are a mere there are myriad ways that that can be done. But at the end of the day, if you have the ability to buy a a Bitcoin asset, set it up in your home and mine, that can be done. Absolutely feasible. You're you're not, necessarily, quote, unquote, competing against the big players. You're just dollar cost averaging in through your electricity bill as Econo Alchemist, alluded to. However you wanna accomplish that goal, do that. But understand that this is this is absolutely a feasible thing that can be done today.
[02:42:09] Unknown:
Yeah. All the narratives against home mining have been shattered in my opinion.
[02:42:17] Unknown:
Oh, absolutely. I mean, you look right now at the the profitability for miners at right now, the the one of the tools I like, there's a couple of them. I like, what to mine dot com or, cryptomining.tools. Those are mining calculators that you can look at. You can, put in your, residential electricity rate, choose the different miner that you want to actually, look at, and you can get an idea of what your profitability will be. And if you look right now, like, if you're at a residential rate, the average in the for the United States is 13¢ per kilowatt hour. At 13¢ per kilowatt hour, you're literally earning mining Bitcoin probably at around a 60 to 70% discount from what you would buy on a spot market.
[02:43:07] Unknown:
Yeah. A lot of those calculators are broken after the whole China thing. So the one that I found to be most accurate is insights dot brains. That's braiins. And you guy have in Antminer right now is breakeven price, 13¢ a kilowatt hour. Daily profit, $2.86. You jump to new generation. Even even not the newest generation, the What's Minor M30 s is 30¢ a kilowatt hours breakeven. Daily profit, $21.25. And once they put brains on that, like, you're talking you got 4 minors. You're making more money than you're making at your at your Fiat job.
[02:44:06] Unknown:
Yeah. Like, right now, I mean, I run, the s 17 pro, 5th 50 Terahash model. And for me, basically, per miner, I'm essentially, DCA ing a $100 a week in in Bitcoin. Daily profit on an s 17,
[02:44:24] Unknown:
not a pro, but just a regular s 17,
[02:44:29] Unknown:
$16 a day. Yeah. I'm, for mine, I'm basically getting getting around $100 a week. We're just just round numbers. Call it a $100 a week, and I'm paying around 30 ish.
[02:44:41] Unknown:
Yeah. On the n 30 twos on the n 30 twos, we're making at 8¢ a kilowatt hour. We're making $400 a day.
[02:44:51] Unknown:
Right. So it's not only at this point right now, it's not only, you know, just about breakeven. I mean, if you're if you have even a a decent electricity rate, you can be rather profitable, and that helps a lot to get your, return on initial investment as long as these machines have a little bit of longevity to them. It's important, you know, when when you deploy, there's a lot of things that go into it. But, you know, the entire narrative as Econo, alluded to, the entire narrative for so long that was, you know, just buy and hold. Don't even worry about money. I am I am so excited to see that, be falling away and and more day by day, I see more people on Twitter.
There's a guy, Bob dot Hogle. He just, you know, released his his guide. And it's like every guy that comes out, I feel like that's another baton being passed to the next to the next round to the next round of people, you know, putting out these machines and becoming garage band miners. So I'm I'm absolutely I'm so happy to see this this change.
[02:45:56] Unknown:
Yeah. I love it too. But we I think we need to move away from this, ROI, this idea of ROI, like, return on initial investment. Because people look at it and they're like, okay. So it's 14 months before my machines are paid off. And I understand that that's that's conventional, but at the same time, you gotta remember, okay. So now the machines are paid off, and it took you this many months to pay them off. But at the same time, those machines are not a nonzero value. Those machines are still worth an incredible amount of money. Like, you can't discount the fact that you have physical capital still.
[02:46:46] Unknown:
No. Not at all. I'm not it's it's not that. But but there is, an a real cost, that you have to deposit into this, especially if you're paying for a miner in Bitcoin. Then, you know, your your return on investment is are you pricing that in US deal? Are you pricing that in Bitcoin? So, you know, you're gonna there's there's things that you need to look at, but, with the especially the state of the network as it is right now, I'm of the opinion that there's there's never been a time better than, potentially right now, the next I have a dip. 6 months. Yeah. The next 3 to 6 months are crucial as all these miners are coming out of China, all this like, this is the iron is hot right now.
[02:47:33] Unknown:
Yeah. And to to Neil's point about ROI, you know, I I think the asset appreciation actually bolsters the ROI argument. That's one of the first things I hear people bring up when they're considering mining is, like, well, you know, how long is it gonna take me to earn my money back? Would I be better off just buying Bitcoin with it and holding it instead? And, you know, that's why a week ago, I I put that little mini thread together with some data I had collected about the previous 12 months to help people decide what would be a good idea for them to to get into mining. Like like, what the profitability of it for them will be.
And, you know, right now, even if if the price stayed static and the network hash rate doubled, you'd still be mining profitably at the average US electricity rate. And in in in the in an in a flip scenario where the price crashes, but the hash rate state is static, you're still running profitably at the average electricity rate. So like you're saying, I I think right now, the you have nothing but upside potential to gain from this. Because even even if the price goes down and the network hash rate goes up from this point, most people in the United States are still gonna be profitable mining at home.
[02:49:04] Unknown:
Yeah. And it's important when you're looking at these things that, when you're calculating potential return on investments or whatever you're looking at, do worst case scenarios. Don't don't calculate your your absolute rosy rosy eyed glasses, you know, because profits come and go. Alright? And if, you know, things can happen and things can change to where this, amazing profitability we see right now today could go back to like it was just a year ago. And, you know, you you were potentially I was mining at a loss on these same exact machines that I'm now mining at basically 70% under market value. So calculate your risk as if things were going to be really bad and be, you know, be pleasantly surprised, not that it's aware of. Thing the last thing you wanna do
[02:49:54] Unknown:
is is not mining at a loss. The last thing you wanna do is be selling at a loss. Do not put yourself in a position where you have to sell coins at a loss. That's just always keep a reserve. Just know that it's gonna go bad. It always does. You'll end up in a position where you can't afford your bills or whatever. Money at a loss is fine as long as you can cover your bills, but do not sell at a loss. That has wrecked more people than anything else is overextending yourself. Do not overextend.
[02:50:42] Unknown:
Yeah. So, I mean, guys, this has been a great conversation. We're nearing the 3 hour point. I think it's probably a good time to wrap up. I appreciate all your time. I guess we'll do final thoughts. We'll start with Iko. Iko, final thoughts.
[02:50:59] Unknown:
Anyone can mine at home. It solves the issue of privacy. It it solves the issue of censorship resistance. It show it solves the issue of KYC. It it's very profitable right now. There's a lot of margin to, go to the downside and still have this make sense. It's worth the effort. The hardest part is gonna be the infrastructure. But once you get over that hurdle, it's smooth sailing from there. Plug it in. Let it run. The thing is on autopilot. There's just so many benefits to money at home, and I'm just thrilled that there's been a lot of interest from the community in pursuing it.
[02:51:42] Unknown:
Awesome. Thank you, Iko. Neil, final thoughts.
[02:51:47] Unknown:
Not much. I just wanna I just wanna give a shout out to my brother again, Eric. He dude, it's so it's was such a blessing to orange pill the guy. One day, I'm sitting at the bar with him, and I go, you wanna get into Bitcoin mining? He's like, yep. Done. So easy. And to have somebody to kick problems around with all the time, every day, every day, if I need him, he's there to to answer anything and work with me. It's just been such a blessing. And to answer some of the, chat that I've been looking at, 12. I drank 12.
[02:52:29] Unknown:
Thanks, Neil. Diverter, final thoughts.
[02:52:36] Unknown:
Yeah. So, as the chat says, don't be a DJ. This this whole mining for the streets thing, this whole individual garage band mining thing, I I feel like, it's we're seeing a resurgence of it now, which I absolutely love. We're gonna need it to continue to grow. Understand that when you are, asking to operate in a market that is outside of regulations, which is what we're doing, We're we're asking to be left alone. We don't want KYC. We don't want all this stuff. So when you're when that's the case and you're you're asking, you know, you're you're making the initiative that I don't want I don't need regulations, then what that means is we have to regulate ourselves.
So it's on you to do the research. It's on you to find the reputable dealers. It's on you to, learn about your infrastructure, your electricity costs, your profitability. All this is on you and your personal responsibility. Anybody that tells you that it can't be done, has just simply not done the research themselves. DUIOR, do your own research. Don't skimp on, reputation to save a few bucks, and fire those miners up.
[02:53:59] Unknown:
Thank you, guys. I hope to have you all on dispatch again soon. I think this was a very good conversation. I think,
[02:54:07] Unknown:
one last point one last point, Matt. Hit us. Everyone can ask us anything they want whenever they want. Do not make a purchase without verifying it.
[02:54:21] Unknown:
100%. I mean, we appreciate your time. I think so I'm gonna put, I'm gonna put links to all their Twitters in, they're tagged on Twitter, on the actual tweet of the show, but I'm also gonna put them in the show notes as I usually do. I'm also gonna put links to the guides in the show notes. You can also find both, Eco's blog and Diverter's blog on sidleldispatch.com/help. I just wanted to thank the freaks who joined us in the live chat. Once again, I wanna thank the freaks who support the show. Reminder, you can go to new podcast apps.com to download a podcasting 2 point o app, where you can stream stats directly to the show. All you have to do is search CITIL dispatch there, load it up with stats. You can stream stats that way. You can also support the show by going to sidlodispatch.com, and there's a there's a tip and dot me, so you can donate via lightning, or you can donate via PayNim.
So I implore all of you to do that if you're interested in, oh, well, I implore you all to support the show. I appreciate that. But I implore you all to check out their Twitters, follow them on Twitter, read those guides. Once again, still dispatch.com/help has links to the blogs. And I'm just feeling really grateful here. I love my BitHorners. I love you guys. Thank you for being on the show.
[02:55:42] Unknown:
Thanks, Matt.
[02:55:43] Unknown:
Thanks, man. Ben Black. Yeah. Thanks, man. We're definitely gonna make it happen again soon. Appreciate you guys. Absolutely.
[02:56:01] Unknown:
The sun is hot, and that old Clark is moving slow, and so am I. Workday passes like molasses in wintertime, but Oh, miss something tall and strong. Make it a hurricane before I go and sing. It's only half past 12, but I don't care. It's 5 o'clock somewhere. This lunch break is gonna take all afternoon and after night. Tomorrow morning, I know they'll be held to pay. Hey, but that's all right. I ain't even had a day off now. In over a year, I've been making vacations. Gonna start right here. Get the phone's from me. You can tell them I just sailed away. And, boy, miss something tall and strong. Make it a It's 5 o'clock somewhere.
I could pay off my tab for myself in a cab and be back to work before 2. At a moment like this, I can't help but wonder what would Jimmy Buffett do. Funny you should ask,
[02:58:55] Unknown:
It doesn't matter. 5 o'clock somewhere. It's always on 5 in Margaritaville, come to think of it. I heard it. You've been there, haven't you? Yes, sir. I've seen your boat there. I've been
[02:59:42] Unknown:
Love your freaks. If you prefer to support the show via merch, we got some quality merch [email protected]/stack. Check that out. I love you all. I'll see you for rabbit hole recap on Thursday, and I'll see you for another Bitcoin Tuesday on Tuesday. Stay humble, stack stats.
[03:00:00] Unknown:
Later, bro.
There's our indicated up. Dow futures up by about a 123 points right now, but they were up by more than a 100 points more, just a little while ago. We were looking at the Dow up by about 200 and 25. S and P futures up by 14, the Nasdaq up by about 53, and then the treasury market is really something to behold at this point. Earlier this morning, the 10 year was just at, 1.2%. In fact, it's fallen below that to 1.17%. That's kind of unbelievable to watch this pressure on yields continue. 30 years at 1.8%, 2 years at 0.206, And the price of Bitcoin fell below 30,000 for the first time since June 22nd. About $98,000,000,000 was wiped off the entire crypto market just in 24 hours. This morning, Bitcoin at 29441.
Ether's down about 4.6 percent to 1735. Pressure across the board though with declines of more than 7% for Litecoin, for Ripple, for Dogecoin, and the energy market too. This was something to watch. There's a little bit of a bounce back this morning for WTI, but yesterday was the biggest decline we've seen for the oil market's worst day since September and the lowest level in 2 months at $66.84 a barrel.
[00:01:10] Unknown:
Got some other big losers to talk about as well yesterday. Energy stocks tumbling after the price of oil fell by as much as 8%. Crew stocks each down, between about 4 6% yesterday, adding some dramatic losses for the month of July so far, but those stocks regaining some ground this morning. Take a look at where things, stand. You're you're looking at, a little bit of a a rebound there. Airline stocks also punished yesterday as well. Those stocks, rebounding again, this morning. You can take a a look at, where some of those stand, Royal Caribbean, looking like it's up about 3 a half percent, and some of the airlines as well, off, but, but pushing forward this morning. Those stocks, as I said, rebounding before. As stocks plunged yesterday, investors betting on a familiar category that could grow if COVID cases continue to rise, and that's grocery stores. Shares of Kroger and Albertsons jumped. Costco touching an all time high. Other pandemic plays were higher, including Clorox.
And, yes, Peloton is making the trade back.
[00:02:11] Unknown:
Kroger up by 5.7%.
[00:02:12] Unknown:
Think that's your you think I thought everybody was either bought their Peloton or not by now. You really think this is gonna happen this way? Did you hoard any of this last time? I saw it.
[00:02:24] Unknown:
Because I shouldn't say this. It's on every table around here Yep. NASDAQ. And there were a couple of times where I might have said, look. I I might have taken one of those home. Are you kidding me? You shouldn't Well, you couldn't get them. You couldn't get You couldn't get them. You couldn't get them anywhere. Did you steal the toilet paper that happened to? I I would just wrap a lot around my my hands, walk out without anyone noticing. No. I didn't do that. But now here's my here's okay. Did you guys read the journal today? I want I want everyone to read this. It's, we'll always have COVID, but it's gonna be manageable according to the journal, even the delta variant since hospitalization is so so rare even if it it it's fairly effective, the vaccines are, and we'll develop new vaccines against it. But we should get used to it, but it probably won't cause the the same type of disruption that that the first two surges I I don't think there is You know is not shutdown.
Yeah. But you know who's not listening? The 10 year. Yeah. And the 10 year was ahead of this. Right. Because we did talk we knew about the d word, the delta word 2 weeks ago, 3 weeks ago, 4 weeks ago. That's what's been pressuring it the whole time. I don't know. I think Actually, investors the consequences of the slow of the slowdown of it not being as robust or or or reopening being delayed somewhat, I think was what what else would account for the 16th to 11?
[00:03:39] Unknown:
The the only thing that I can think with that is it was somebody hedging their bets. Somebody who thinks it's going to be a strong opening, a strong economy, maybe you hedge your bet by by taking the other side of it in the treasury market. Because I can't imagine that that there are investors who saw this,
[00:03:54] Unknown:
you know, 3, 4 weeks ago and thought, okay. This is what's going to happen. Seeing the packed stadiums and the 80 you know, the greatest earnings we've ever had, all those things, none of that accounts for the 10 year.
[00:04:07] Unknown:
No. You're
[00:04:11] Unknown:
welcome.
[00:04:44] Unknown:
Happy Bitcoin Tuesday, freaks. It's your boy, Matt O'Dell, here for our weekly Citadel dispatch, the interactive live show about Bitcoin distributed systems privacy and open source software. To our freaks joining us on the audio feed, That was our CNBC crew this morning grappling, I guess, with this new idea that another COVID lockdown is gonna hit us. And, just, you know, kind of you kinda can feel like a little bit of panic in the air from the mainstream journalist. I know that was a more trash clip than usual out of, CNBC, but, I kind of view them as a time capsule. And I think in a couple years, we'll look back and kind of laugh at all of these clips. So, here we are showing them regardless.
They used to be the most watched Bitcoin show in the world, and now they kind of have put Bitcoin on the back burner. It's just, like, kind of a side note, which is interesting to see. I wanna do a quick shout out to all the freaks who support this show and keep it ad free. I don't want this show to ever have ads or sponsors. I think it aligns incentives better. The best way you can support the show is through the podcasting 2 point o apps. If you go to new podcast apps.com, you search Citadel Dispatch, you load the app with stats, and then you could stream stats to the show as you listen.
You can also donate, via the l n URL QR code, which we do have more guests today. So it is blocked on the video stream, but you can find that on my Twitter profile. Or you can go to citadel dispatch.com and donate through tipping.me or our samurai. The support is real for me, freaks, and I do really appreciate it. I think, we need more people to step up and try this new format. Like I said, I think it aligns incentives better. It is not all it is definitely a slow roll. It's still dispatch. I've been running it for a loss, since we started over 6 months ago, but I think it'll be worth it in the end. Some things, you know, require a strong foundation, and sometimes the mission is more important than the short term gains.
With all that said, this is serial dispatch 31. We have some very special guests today for a conversation that I have really been looking forward to. As a result, to get these great guests together, we had to do an earlier rip than usual. So to the live freaks who are joining us, you know, 5 hours earlier than usual in the live chat, thank you so much for joining us. I mean, the live chat is really live audience chat is really what makes this show unique in my opinion. No topics are off limits. We will get to all your questions. So I appreciate you all who are joining us. So with that said, today's topic is getting started with Bitcoin mining. I think it's kind of fitting since, most of the corporate miners are at a big conference in Miami right now called Mining Disrupt. You know, it's got a little bit of a shitcoin tilt to it because it's got disrupt in the headline.
So I have 3 of the most outspoken pleb miners, miners who have been focused on making it easier for the average person to get into Bitcoin mining and all that that takes. We have Diverter No KYC who's joining the show again. I believe this is his second time. How's it going, Diverter?
[00:08:07] Unknown:
Yes. 2nd time. Glad to be here. Can't wait to get started on this.
[00:08:11] Unknown:
We have Econo Alchemist who's also joining for a second time. How's it going, Econo Alchemist?
[00:08:17] Unknown:
Going great. Thanks for having me. Dude, thank you for joining.
[00:08:20] Unknown:
And we have first time guest, Ronan Miner. His government name is apparently Neil, and that's what he's titled on here. How's it going, Neil? I'm doing great. Yeah. What's up, freaks? So, guys, I mean, historically, the best time to get into mining is in downturns. I think you guys probably all agree that the best time to get into mining is all the time. But I think now more than ever, especially with this recent crackdown in China, and we see all these ASICs prices are going down significantly more than Bitcoin, it seems. It could be a good time for the average Bitcoiner, the average self sovereign Bitcoiner to get into Bitcoin mining. It's a great way to to stack.
If you do it right, there's no KYC. It's it's it's probably one of the most private ways to accumulate Bitcoin. And I think even if it's at a slight loss, those two benefits, can can outweigh, any any loss of income there. But, I mean, you guys seem to have been doing it pretty profitably, so, maybe we get the best of all worlds. So I I'm thinking here with this conversation, it's gonna be a general getting started with Bitcoin mining, acquiring ASICs, setting up the ASICs, power costs, and other things people need to keep in mind. We'll have a conversation about KYC and how to limit it, limit your personal information. We'll talk about Compass hosting and other hosting providers that'll host your ASICS for you and the trade offs present there.
We'll talk about cloud mining, which I personally think no one should use, but I guess we'll get into that. And, we're just gonna talk about the state of mempools like we always do, and and we'll see where this conversation takes us. Like I said, freaks, if you have any questions, feel free to throw them in the audience chat. If we don't get to them right away, I am jotting down questions, as I see them as well. So so, hopefully, we will get to all of them, as we go on. So so I guess where where should we start? Why why don't we start with with Neil?
Neil, to to the average to the average freak, you know, maybe they've been listening to Citadel Dispatch this whole time. They're trying to improve their setup. Why should they be interested in mining Bitcoin?
[00:10:40] Unknown:
Well, simply, it's KYC free sats like you're saying, and then, it's income. It's so when well, back up. Some guy, Fartface and Nick Foster just gave me miners were worth s nines were worth nothing. They just sent me a couple each, and I was mining at a loss last July, so a year ago. And just to do it, just to wrap my head around it, figure out what it was all about, and whatever. So I'm paying a little bit of premium. I'm not sure if that premium was even more than, like, CoinJoin implementations. You might be paying the same fee. I never looked into it that closely. But and then I and then you hear Michael Sailor say some things and kinda it just, like, dawned on me. And I was like, well, what what are my personal options in the future for for yield or for how am I gonna ever execute on these Bitcoin that I've been sitting on? Like, your only options are sell your Bitcoin or lend it out to one of these 3rd party lending services that I've never trusted. I've never supported. I there's no there's no reason for me to ever do that, but it seemed like the only other option.
And simply just buying, maybe spending a little bit of your Bitcoin to get some machines was a better idea, and then you have a solid yield coming in regularly. You're always you're always you're at least if you have to spend the Bitcoin, it's not your stack. At least you're making Bitcoin that you could be spending.
[00:12:13] Unknown:
That's some great insight. Diverter Eco, you have anything to add there?
[00:12:20] Unknown:
Well, for me personally, I I got into mining, originally solely because I saw that, the trajectory that Bitcoin was on, or the on and off ramps, I should say, that the was on is that everything is becoming more KYC. KYC is creeping in everywhere. No matter where you look, if if you have to put an identification in. So I'm I'm trying to figure out ways that I can continue to acquire Bitcoin without having to do KYC. Now this is in 2,000 18, I guess, the very end of 2018, maybe 2019. Anyway, it was a while back, and I I started thinking about mining. But then when I came on to, Bitcoin, forums, places where you would go like Reddit, Twitter, places like that, and it was completely and totally discouraged that, you know, you should not even worry about mining. Just buy and hold. Just buy and hold. Just buy and hold. But that's not accomplishing my goal. Like, the whole point is I I I want to get Bitcoin, but I don't I'm afraid of the KYC part.
So after a little research, I look into it, and I can't figure out why I wouldn't do it if I understand that I might very well lose a little bit of money here. Generally speaking, though, if you go to a BISK or a a HODL HODL or one of those platforms, most of the time, you're gonna be paying a little bit of a premium over regular spot market value. So what's the difference, you know, the way I see it? So there's there are plenty of reasons to do it if you are concerned about ways that you can acquire Bitcoin and keep your identity more hidden, but it's not for everyone. So, you know, it's a very personalized thing. It's it's what these blanket statements of either everybody should mind or nobody should mind, they don't they don't help anything.
[00:14:30] Unknown:
Yeah. I mean, I think that's a really strong point about the privacy premium you pay regardless. I mean, Neil touched on that, you know, but between whether or not you get it on Bisk or Huddl Huddl or or local ATM, you know, a lot of these local ATMs, some of them only require phone number, and and you can use, you know, a burner phone number. They often they often come at a premium, and you often you're reduced in the amount you can purchase at a given time or cash trades or, you know, selling for goods and services. Or as Neil mentioned, if you do KYC and you go through KYC, this the only, in my opinion, if if you're using a KYC service, it's completely unsafe.
But if if you if you use it with CoinJoin, at least you get some forward privacy, and it's reckless not to use it with CoinJoin in my opinion. And when you use CoinJoin, then you're gonna you're gonna take additional fees. You're gonna be paying minor fees. You're gonna be paying CoinJoin fees as well. So So in general and, I mean, I think this is probably bigger than just the Bitcoin world. I think in general, privacy usually comes with a convenience and a and, an additional monetary cost, every time you want to do something that's more privacy conscious. Right? So we have diverter, I guess, was, like, the first one to really release a, like, a full write up on how someone could get started with doing this. I think he called it mining for the streets.
I don't know if if is that guide still out there, Diverter?
[00:16:01] Unknown:
Yeah. You can find it on on, my blog. It's on, links in my Twitter profiles, diverter.hostyourown.tools, and then money for the streets is is the name of the article. Awesome. Yeah. And and like you said, it's the fact that we're even sitting here having this conversation right now, not to sound like an asshole or or or arrogant jerk or anything, but it makes me feel fulfilled in in a certain way, because the whole point of me trying to put out, mining for the streets was was exactly this, to to try to change the narrative. Because at that time, it absolutely was not was not advised for anyone to get into mining. Nowhere you went, could would you see anyone that would encourage you if you said, hey. I'm thinking about getting a miner. It was immediately shot down. So the fact that this conversation has even taken place, whether it had anything to do with me releasing this or not, I still feel,
[00:17:04] Unknown:
an amount of fulfillment from it. Oh, it it it has definitely had something to do with it, man. I I read that article so many times, and it was so instrumental in, like, me thinking, okay. Maybe I should start doing this now. It's still it's still one of the number one articles I I share with people when they're talking about, well, where do I even get started? And I'm like, well, here you go. I I send that article to so many people.
[00:17:26] Unknown:
I mean it I mean, it's been a narrative that's been around. I remember, like, even in 2013 on, like, Reddit and, and Bitcoin talk, like, people would say, like, because for whatever it's worth, the for some reason, normie's a first inclination, if you're a new corner or a pre corner, your first inclination is I wanna mine Bitcoin. It's just, like, the natural path that people usually take. You even see it with, like, the institutional guys or, like, the CNBC people. Like, they just immediately, the first thing they say is, like, I wanna mine this thing, with my computer.
And then people come into Reddit. They come into Bitcoin Talk. This was back in, like, 2013, 2014, and the first thing that people say is you're gonna lose more money if you mine. Don't fuck around with it. Mining's only for the professionals. And to this day, we still see it on Twitter. So I think, Diverter, I think you made a very big impact. I mean, we have Eco here, e Econ Alchemist here, and, I mean, he credits you with his he came out with his own guide, a very, very good guide. And, Nico, you credit Diverter with part of that inspiration. Right?
[00:18:31] Unknown:
Yeah. 100%. Diverter's article was a huge breakthrough for me. You know, if if we back up, like, 8 months ago, I I had made the decision that I was never gonna KYC again. I was all out of dry powder, but I still wanted to accumulate Bitcoin. And so I was just kicking rocks trying to figure out how I was gonna get more Bitcoin, and I and I just kept coming back to mining. But as you guys have highlighted, the narratives were just don't do it. You're gonna waste money. You you can't mine unless you've got your own hydro plant. Like, leave it to the big guys. So, you know, I was just searching for something to some way to get more Bitcoin. And and diverger's guide, I I found that and read it, and that was just the light bulb moment for me that that made me look at the whole situation not so much in the sense that I was gonna be competing with the rest of the network, but that I was gonna be dollar cost averaging through my electric bill. And so that instantly solved the issue of privacy, KYC, third party risk. It was a no brainer for me. And like Diverter said, even if even if I was mining at a little bit of a loss, I was gonna be paying that premium on bisque anyways.
So, you know, that was that was a huge moment for me, and it just kinda opened up this whole new frontier.
[00:20:02] Unknown:
Yeah. And I still have I still have people up in my comments telling me. I just had a guy the other day that was vehemently arguing with me on whether whether a single person could mine profitably or not. And I was like, I don't care that you failed at it. That's not my I'm sorry, you mined through a bear market or whatever you did wrong, over allocated or something. And it's like, no. It's been it's been very lucrative for me. So I have no I have no problem in telling people, like, as long as you do it right, like, it's the same rules that apply to Bitcoin.
You DCA miners, you get a little extra cash, you buy another miner, something like that. You see a dip like we just saw, you buy the dip. The same rule apply. And then you plug them in, and you let them run. And even so every every unprofitable sat that I've ever mined is deep deeply profitable right now. I just hung on to it. If you're not selling, you're not losing money. So
[00:21:05] Unknown:
Yeah. And, you know, it's a it's a it really is a mindset type of thing. You know, the and if you think about it, one of the things I I talk about in Mind for the Streets was the entire ethos around Bitcoin. Everything centers around don't trust, verify, except in this one area. This is the one place where everybody was actually encouraged to just trust that somebody else is gonna mine. You don't have to worry about it. The big guys got it. And that just struck me as all kinds of wrong in in many different ways. So, you know, the difference really is comes down to a mindset of, okay, am I going into this as an actual profitable business or as I am I going to this as a way to accumulate Bitcoin in a way that's more private where I can attempt to keep my identity more more hidden?
And the upside, as we've seen, recently is you you actually don't know whether, just buy and hold will be more profitable. BlockWare Solutions, put out a report, which I linked to in in in the guide, from a previous cycle, talking about, whether people that, just bought and held or those that mined and actually sold just to pay their electricity bill, who came out the best at the end of the bull market. And it it it was the miners. It was the people that were mining and and just selling enough to pay, their income, and the reason is probably just because of situations like we're in right now. So things can change even if you go into it mining at a loss like like I did. I was mining at a loss when I first started, and I think you said you were too, Neil, but things can change so quickly.
The difficulty adjustment has the ability to, you know, kind of stabilize this market. And if some outside in influences come in, you never know. You may be you may end up extremely profitable like we are right now.
[00:23:14] Unknown:
Yeah. And you don't and then and this is, this recent event is actually super fascinating because okay. So even 3 months ago, miners were twice or 3 times the price, and the price the price of Bitcoin was higher, the network hash rate was higher. But then you saw, okay, your your physical equipment has been devalued because all of these miners came out of the market for sale. But at the same time, network cash rate dropped, so then it became ultra profitable to be a miner. It's almost like its own its own, like, self fulfilling hedge against.
I didn't really think that idea through before I started it. But, like, you're always maybe your miners go down in price, but now you're making more Bitcoin. So it's, like, it's a win win either way.
[00:24:03] Unknown:
Right. But so, I mean, an interesting aspect here, right, is a lot of people, I think, when they think about getting into mining is they they always go to those, like, calculators. Right? Those, like, revenue calculators. And Bitcoin is such a crazy beast that, you know, you have 2 aspects that the calculator can't really predict, right, which is, you know, how the what happens with the difficulty adjustment, and, you know, how much hash is on the network, how much hash leaves the network, and what the Bitcoin price is. Right? And that's, you know, in in a way, I mean, if you if you're if you're mining, it's it's even more of a long term game than if you're doing buy and hold or or stacking. Right?
[00:24:42] Unknown:
That's yeah. That's exactly right. That the whole point I I made the argument that, especially a home miner, is actually the most bullish person on Bitcoin. You think you're bullish. Well, do you have a miner running in your garage? Because, what that means is you can't just suddenly lose faith one day and decide to hop on Coinbase or Kraken or wherever and just sell all your Bitcoin and walk away. It doesn't work like that. If you're going to to mine Bitcoin, you're gonna put in time, energy, money, into setting up your infrastructure. You're not gonna be able to just what are you gonna do? Just just just turn a miner off and leave it sitting in your garage? Now you've got 1,000 of dollars worth of equipment.
So it's absolutely a long term bet on Bitcoin. So, you know, get your get get your mind right before you just think about it.
[00:25:40] Unknown:
Yeah. And it's not it's not easy money. It's not like you just go and plug in a miner and and you start printing your own money. It's it's a lot of work, especially if you wanna scale up an operation. Then now you're talking okay. So, like, for example, 400 amp is about the most power you can get going into a residential without without really having to pull some strings and do some stuff. So 400 amp, that'll that'll do 20 new generation miners, and then you're tapped out. You're not increase that operation by by very much more. So you have to start looking elsewhere to to figure out where to go. You that's why I call myself a power pirate. You gotta go wherever you can go to find more power.
And then so, like, for example, what I've been looking into right now is there's somewhere around 1500 subways that closed either during the pandemic or the year before well, in the last couple years, 1500 subway locations have closed. They have bread ovens in there. They have other machines, stuff like that lighting. They use a decent amount of power. They're probably somewhere between 406 100 amps for a location like that, and they're all sitting empty right now. And there's nothing more than that strip strip mall owner wants than to lease that out. So they're gonna give you a pretty decent deal on the lease itself, and then your only issue is dealing with airflow, deal dealing with heat and noise.
And there you go. You got another you got another petahash location just handed to you. You didn't have to build out the infrastructure for it or anything like that. And I guess where I'm going with this is, like, you wanna keep it small and you want to spread it out. So if the power in the town goes out or you lose Internet access or something like that, you don't have a 100 machines going offline at once. You're better off, like, distributing an ad out to smaller locations. Yeah. It's a little more man hours going around each one, but once once you're up and running, like, you could do that in a day. You can hit 5 locations in a day, and there you have there you have 5 Petahash online. You're you're doing just fine.
[00:27:59] Unknown:
As you guys can tell, Neil has really taken off in the last year. Like like, me here here, me and Eco are, we've got a we've got a miner or 2 spun up somewhere in the back room. This dude's renting out subways. Okay? So this this thing is a serious bug, when you get into it. Believe me. Oh, it's it's definitely addicting.
[00:28:22] Unknown:
Yeah. It goes to the same like I was saying, the same rule for for miners is you DCA the miners, and then you buy it buy buy the miner dip. It's the same thing with with hash power. You never look at your bottom line hash power number and say, that's good. I'm I'm satisfied with that. No. You never look at your Bitcoin stack and say, alright. I'm gonna stop stacking now. No. You always want more hash. It is it is probably more addictive than stacking coins themselves, actually.
[00:28:55] Unknown:
Yeah. And it it is a commitment like Diverter was saying because in in in relative Bitcoin terms, it's gonna take you, you know, 8 months to a year to earn back the amount of Bitcoin in mining that you would have had to have spent to get the hardware. So, you know, you you gotta be in it for the long run. And then what other business you know, there's there's just not a lot of other business models out there that will give you a return on investment in a year or less. So it it you know, once you get into it and you figure out how it works and you get over that infrastructure hurdle, and then you start seeing that you're getting really close to return on investment. Well, then you wanna take some off the top and reinvest and expand your operation.
And that's why I'm saying it's addicting because that's
[00:29:52] Unknown:
And you look at it happened to me. Yeah. And you look at it when you start when you start scaling up, you start seeing, okay, ROI might be increasing because of additional costs. Like, okay, you owned you owned the first 400 amps at your own private property or something like that. Okay. The next 400 amps is gonna cost you more because you have to lease it out. So you start looking at increased costs like that, and it kicks your ROI kicks your ROI down the road a little bit. But then you also have to remember, on ROI, you're not it's not just a initial capital investment that you're looking to get returned on. I mean, because the machines themselves are also if the price is going up, the price in the machines is going up. And then with this recent shutdown of, microBT, where they're not even manufacturing new generation machines till September, And I don't know what Bitmain's doing. They put some hold on on selling, and sounds like they might still be producing, but they put a hold on selling. So, I mean, the glut in the market may completely flip on its head where all of a sudden there's a shortage because you have a company like MicroPT that's no longer even producing them.
So then now you're looking at, okay, so you ROI'd at your cost. Your machines are paid off. I mean and if you needed to shut down one of these one of these small opera one of these small 20 unit operations you have going on or something, those machines may, even though they're used, may have appreciated in value 3 x. So, I mean, you got the the world's your oyster at that point. And I know I personally know a guy. He just got a $1,000,000 loan collateralized by his machines. So if they're doing that now, then the the leverage the leverage on the machines themselves is going to like, okay. So you get a $1,000,000 loan collateralized by your machines.
So what are you gonna do with that $1,000,000? You're gonna go out and buy $1,000,000 more machines. So then now now you have that many less machines out on the market. And if people start doing that regularly, then, I could see a definite a definite run up in the price of machines themselves.
[00:32:08] Unknown:
So I'm gonna just jump in here real quick. First of all, Neil, I fucking love the hustle. Never considered Subway locations. There's obviously a massive retail vacuum because of COVID, because of lockdowns really, less so COVID, but the response to COVID. So that is definitely a major opportunity. I just wanna say to the freaks, you know, if you do use leverage, be responsible with it. You know, interest rates are low, so people are happy to give you a shit ton of debt. Historically, like, the horror stories you hear about Bitcoin mining are are pretty similar to the horror stories you hear about Bitcoin purchasing Bitcoin, which is that people go in way too heavy at the top.
They don't know when the top is. None of us know when this cyclical top is gonna be. And with Bitcoin mining specifically, you end up having fixed costs, especially if it's a larger operation. And those fixed costs, you know, could be labor. They could be rent. They could be electricity. And those fixed costs, if if if you're not set up to deal with them, you end up selling the bottom, whether that's your ASICs or whether that's the Bitcoin stash you built up. I'm completely down to go deeper down this rabbit hole, but I think before we do, I think we should pull it back a little bit and talk about this idea basically of, you know, having 1 or 2 minors in your home or your office, a place you already have electricity. Maybe you live in a colder environment, and it can also offset some heat costs so you don't have to really deal with cooling.
It's definitely way more accessible, you know, if it's only 1 or 2 machines, especially to get your your toe in the door, which is is what I think the focus of the show probably should be. I'm curious. Like, I think part of the reason I've always been interested in Bitcoin mining is for ideological reasons. Like, I I think what we want to see as stakeholders in this network, is this idea of Bitcoin mining distributing out to more people and more small operations, that are ideologically minded as well, that believe in the idea of freedom money, that believe in the idea of censorship resistant Bitcoin. Does that factor at all into your guys' mining, or is is that just a is that just an afterthought after, you know, stacking as much as possible?
[00:34:23] Unknown:
Let me back up to your your what you were just saying, and then I didn't include it in what what I was saying is, but no. Leveraging your miners, using them as collateral towards anything is, like, the worst idea ever because you wanna be doing the opposite. You want to be having some capital on hand that weathers the storm. The last thing you wanna be doing is selling your Bitcoin at this point. So you want to have if you have 2 thirds of your capital in miners, you want a third of that at least in in reserves so that you don't have to sell. The name of the game is not selling. If you're selling coins to support yourself, you're probably in a rough way, and it's not gonna last very long for you. So, yeah, don't leverage.
[00:35:09] Unknown:
And just to be clear, like, this is not that's just not a mining PSA. Like, there's a lot of people that, you know, took collateralized loans out on their Bitcoin right now that are feeling pinches, because of this price decrease. And in in my mind, it's it's a if if you don't manage that risk correctly, it could be very reckless if the goal is, you know, long term accumulate as much Bitcoin as possible.
[00:35:32] Unknown:
Yeah. To your to your question about the the the ideological, reasons for mining, For me personally, originally, no. It it I didn't. I wasn't thinking, you know, how can I help this network? I was thinking, how can I personally, acquire more Bitcoin without doing KYC? So the beauty of Bitcoin is the incentive models. So the incentive model for Bitcoin is if each individual acts in their individual, you know, best interest that that collectively helps the network. So it works perfectly. Now I've I personally don't believe that anyone should rely on altruism as any sort of business model.
So if you're dependent on people being, quote, unquote, good people, you're not gonna make it. So what I like about this individual or what I've kinda termed a garage band mining, what I like about that is that it it kind of helps the incentive model for Bitcoin even in a in a situation where, let's say, the the subsidy the block subsidy is gone. Alright? We're of course, we're talking a long time down the road here, but the point being, if it were if a day were to come where, it's not so profitable for these big huge mining farms to be running, and they shut off, what is the network still secure?
There's a lot of things that that go into this, though. And like I said, even though I don't believe we should rely on altruism, there's some things especially developing now where they it sort of aligns really, really good. Like, for example, this flared gas mining that that Marty and Great America and places like that are doing. A lot of times, like, that right there, that's actually helping, these oil and gas operators. So even if that were, that operation were technically losing money, it could still come out as a benefit to them if they were saving money in in another area. So point being, the incentive model is really aligned perfectly in Bitcoin. It's very, very well done as a system.
But as an individual, I I highly suggest that everyone, that's looking to get into mining, get into mining as an individual. This is not one of those, hey. I'm just gonna run a miner to help the network situations because it's not gonna work out for you, and you're gonna end up losing real money potentially. So help yourself, and by helping yourself, you will help the network.
[00:38:24] Unknown:
Yeah. I totally I totally agree with that. And start small. Don't, like and by small, I mean, like, a single s nine or something like that because you don't you don't you're not they look cool. It's fun, but you have the complexity or, like, the the number of things you have to deal with once you have one when it comes to either heat or noise or I mean, you can hear these everywhere in the house. There's very few places you could put it, even in s nine, and you don't have some some sort of background noise from it always. And if you can if you can find a way of quieting it down or something like that to to Matt's question earlier was it was incredibly profitable for me this winter.
I just had a few s nines running in the crawl space under a condo, and I called my my local power provider, my utility company, and I negotiated down a rate that if if if I was using electric heat for my home and not not heating my home with, natural gas, they would give me a deeply debt discounted rate here in Minnesota. And I I mean, I had my electric rate down to 6¢ a kilowatt hour. So even running s nines, high network hash rate at the time, they were still profitable. I was, I mean, I was paying off the place. And so that my mortgage, my HOA, and my electric bill with 3 s nines and an m 32, and I was heating my house for free all winter from May until October was what they negotiated the deal with me. And that's just me. I'm just as a person. I just called my electric company and told them I was using electric space heat, and they dropped my rate.
And, I mean, that's that's better than any, any tenant you could have rent in your place, screwing up all your stuff and clogging your toilet. I mean, there's a couple noise complaints about how loud my tenants were, but, otherwise, free money.
[00:40:30] Unknown:
Yeah. So, I mean, I agree. The one of the reasons I've always been bullish on Bitcoin is because of the incentives, because we can't expect altruism. We should expect greed from people, and Bitcoin's one of the few systems, if not the only in in our world where it it actually channels that greed to make the network more robust. I guess where I was kinda going with it is, I think as, you know, among the Bitcoin enthusiast community, among the people that are obsessed with Bitcoin, you know, the audience of this show, the industry at large, I I think there's there there's an incentive there where a push to make Bitcoin mining more accessible for the average person, benefits us all, because the network will be more more robust and more secure.
And logic follows that as a result, the the value of the network should increase and our holdings should increase. I mean, there's a there's a major difference, and and we kinda saw that on an extreme, during the 2017 scaling wars where Bitmain was keeping their miners for themselves. Right? And they were mining first before they were releasing it, and they were the main hardware producer of the whole system. And and there's definitely this this existential risk to having these large corporate miners having mining controlled by a very few groups of individuals, that are easy to knock on their door, easy to pressure them, easy to get them to bend the knee.
So, I mean, in general, I commend you guys for for just, you know, pushing for this more accessible you know, making Bitcoin mining more accessible to the masses, if you get what I mean.
[00:42:19] Unknown:
Yeah. When I was first getting started, I I didn't really think I could have a whole lot of impact on the network just running one ASIC. But then you know, so it wasn't so much for the ideological reason of running it. But then when Marathon started censoring transactions, that's when I took more of a sense of pride in in in claiming no one's gonna be able to use these 80 terahashes per second to censor transactions because I'm in control of them. So, you know, I now I wanna get as much hash power as I can so that I can ensure that no one else is using that hash power to censor transactions or use the network in a way that that I disagree with ideologically.
[00:43:07] Unknown:
Yeah. And if there's if there's nobody gonna mine those transactions, fuck you. Well, I'm gonna mine
[00:43:14] Unknown:
them. Right. Right.
[00:43:16] Unknown:
And that brings the incentives back in line too because, if if the majority of the hash isn't mining a certain transaction, those fees on those transactions will go up, and you'll make more money than a miner that isn't mining them.
[00:43:28] Unknown:
Yep.
[00:43:29] Unknown:
Right. Yeah. And, you know, the power usage, is is not, easy to disguise or hide this. You're you're not gonna hide a a a large ASIC farm. But, you know, as as I've seen Marty mentioned a few times that he believes the future, of mining is off grid, and I tend to agree with that. I just believe there there's a little bit of an asterisk there because, in my opinion, these single, you know, garage band type miners are essentially off grid. You know, you're running an ASIC or 2. If we've got 10,000 households running an ASIC or 2 rather than one mining farm running 10,000 ASICs, that completely changes everything.
100%.
[00:44:18] Unknown:
Yeah. I absolutely agree with that too. And that's kinda, like, why why me and my brother started, like, getting into this this immersion thing because it's nothing the power company will come out and give you 400 amps. They'll just do it. You hire an electrician. They'll do your panel. My brother, Saint, by the way, I lucked out and, had an awesome brother who knows how to do all that shit. So I stick to the mining side. He sticks to the actual rails making it work side. But once you have immersion, then you've eliminated the 2 things that I found to be the biggest problem is the noise and the heat, the disturbance. Now you only have, like, a a, what, maybe 8 by 8 by 4 footprint in your garage. Most people to have a Petahash would be willing to willing to accommodate that loss of garage space.
And and then I see, like, there's no reason why every every dairy queen or every household wouldn't wouldn't do that. I mean, the network cash rate I I see in the future is just gonna explode with these with these small miners compared to the large mining farms.
[00:45:32] Unknown:
Yeah. And, you know, the efficiency is is what really increases this. I don't know where you're gonna take this, Matt, but, you know, one of the most common things, that I see people ask whenever they're first starting to get into mining is is what what should I get? Should I get just an, you know, an old used s nine just to kinda play around with, or should I, you know, get a brand new, s 19 pro? You know, how how should I start out here? I've always been I'm always of the opinion that if you're just going to be, you know, a a a single ACIC, maybe 2, running in your home, you should go ahead and go with a good new generation high efficiency miner, rather than go with the s nine, now if that's possible.
I don't believe we will ever again see the same type of efficiency jump that we've seen from, say, the s 9 to the s 19, where we went from 13 and a half terahash at almost, you know, 1500 watts, where we're up now to, you know, a 110 terahash at at just barely double the, the electricity usage. So I don't believe we'll see that efficiency gain in the future. The the race to this point for ASHIP manufacturers has been the race to efficiency. How much hash rate can we put out? I'm of the opinion that in the future, these ASIC manufacturers, will likely the next race is now to longevity.
It's no longer a race to how much hash can we get. It's a race to how long can these miners run. So there's really a spot in the market, in my opinion, for, an ASIN manufacturer to potentially use some of these higher efficiency chips in a, a a a smaller type miner. So rather than an s 19 that gets you a 110 terahash at, you know, 35100, whatever, electricity usage, maybe they they they hit you with something a little smaller that's more capable of being run-in a home that is designed specifically for longevity. Because I I I really think that's where the future of this game is is in seeing how long these things can run rather than how how fast can we get to hashing.
[00:48:02] Unknown:
Absolutely absolutely same thesis on my end is I I think that this new generation may may last upwards of 10 years. And so what you you and, again, that goes back to the immersion thing that I've been that I've been looking at with my brother is so a a cool clean computer is a happy computer. You wanna keep everything you wanna keep it in a static environment. You don't want it the fans all kicking on higher because it's a hot day out or something like that. No. You just want a nice static environment to keep the machine as as stable as possible for as long as possible, the least amount of particulate matter, the least amount of heat or humidity, or if you're in a salty environment or anything like that.
And then, there was another point that you'd said before I was gonna say. But, yeah, I I totally agree with you. I think I think these may last a long time and,
[00:49:03] Unknown:
yeah, go ahead and talk. I forgot what I was saying. Yep. I mean, just look at the s nines. Like, those have been running, and they're still running profitably going on how many years now. You know, I I think these Whatsminers that are coming out now are gonna be that next industry works for the years to come. And I think it'll last well into the next subsidy
[00:49:23] Unknown:
epoch. I mean, s nines were what? Like, 2016, 2017? Yeah. Something like that. Yeah. 2016, I think. This has been this has been a thing, you know, a topic that we've been, we've talked a lot about on rabbit hole recap over the years. This idea of ASIC life cycles increasing. Right? And I think it's particularly well suited for home miners and small miners, because acquiring ASICs can be difficult. Acquiring new ASICs can be difficult. Getting rid of your old inventory can be difficult. And the the big players, it was kind of for for a little bit there after, you know, ASICs got developed to begin with, where they were, like, kinda just racing to the next generation. Right? Make some profit and then race to the next generation.
Especially, when you start talking about home mining and trying to recoup heat costs, if if, you know, you you want you want hardware that'll last you a bit. You know? And I would get go even further, you know, if we're gonna talk about I I expect, to see pretty much, like, every hot water heater, especially in urban environments where there are larger hot water heaters, you know, mining Bitcoin on the side and reclaiming that heat through the hot water, and no one wants to to replace their boiler every 2 years or 3 years. Right? But if you get to the 7 to 10 year point, that that all of a sudden becomes much more feasible. Right?
[00:50:52] Unknown:
Yeah. That's exactly what, Sato Mining is working on right now. I think they're out of France.
[00:50:59] Unknown:
Yeah. And you start you start getting in a whole whole other realm. So the reason why I always talk about 20 miners, 20 new generation miners, the reason why I keep bringing that one up is because it's all pretty pretty static. You're gonna generate about the same amount of heat regardless of if you're with the new generation Antminers or the new generation MicroBT. What's miners? And you're talking and the reason again why I say why I always say 20 is because that's 400 amps. That's about the maximum you're gonna be bringing into a residential area if your if your wires can handle it coming in off the street.
But you're talking about producing 210,000 BTUs that you have to that you have to disperse, and that's right along the lines of, I think, a a 10,000 heating a 10,000 square foot dome. So you're talking a lot of heat being generated. And, I mean, you can start running in floor heating,
[00:52:01] Unknown:
hot tubs. Your water heater is probably gonna be heated up no problem. That's just not that much. I remember seeing a pool heater. Right? Like, a a pool water heater. Someone made a guide for that or at least a walk through.
[00:52:13] Unknown:
Yep. Exactly. And we actually spa 256. Yeah. Yeah. We actually even looked into, running some because, like, in Iceland, their their streets and their sidewalks have essentially what's the same thing as in floor heat because they just have so much geothermal that they could just they can do that. And we looked into doing that in some sidewalks in Saint Paul just to get rid of our heat, but then you run into the problem is how how are you gonna get rid of the heat in the summer? Now you need a separate system. And if you're gonna build out that separate system to get rid of the heat, then why are you eating the sidewalks other than laziness? Just go up and shovel.
[00:52:53] Unknown:
Okay, guys. So so first of all, to the listeners, I'm gonna put both diverter and econoalchemist guides, in the show notes, in the podcast show notes, and and also, on syllabuspatch.com in those show notes. So you should definitely go and and give those a proper read through. They're very, very detailed. Neil, I don't think you have any proper write ups. Right?
[00:53:17] Unknown:
No. Hell no. Anyone who wants to talk to me, my DMs are always open. I help anyone who wants any questions. Awesome. Well, so both those guys will be in the show notes.
[00:53:28] Unknown:
But let's go through this. Right? So the first step is acquiring some miners. Where should Freaks, how should Freaks go about that? What's the best ways to do it? You know, what are some gotchas? What should they be concerned about, etcetera?
[00:53:42] Unknown:
So if you're looking to just start with an s nine, just wait. Joe Rogers is gonna throw up another shop here as soon as we get these current s nines out that we have coming on, we're selling them. Those ones we sold all at cost. Now we decided that we gotta make $20 a minor or something like that. So they're gonna be a little bit more than literal at cost because I have to buy a plane ticket to fly down there and help them ship them all out. But, other than that, I mean, if you're looking for an s nine, you could buy as many as you want from that shop. That store will be going up soon. I'll be posting it everywhere. I'm sure I'm sure these other gentlemen will be too. And that's just trying to get as many minors in the hands of Pleas as possible.
Like, we need we need to arm the cyber hornets so that everyone at least knows what's going on. If you don't like it, sell it off to someone else. Like, whatever. It's not gonna work for you. Just try it. And then, I I mean are pretty cheap. Right? What are they going for right now? Like, 300 or something like that? Yeah. They were $300 when we were selling before. When we when we put up the next store, they might be close to 400. All depending on what the market does. I mean, if there's another million miners coming from overseas, like, that's gonna totally change the price. So I I I don't know. That's that's why we're waiting. We just wanna deal with the first, however many we sold, and those are at cost. We literally didn't make a dollar from that. And if there is anything left over from shipping, we're just either gonna open a bar tab down at Bitblock Boom, or we're gonna donate it to Bitcoin Beach or something like that. Like, we're not we're not we're just doing it because we want people to know how to use miners. Then we wanna know what kind of, yeah. No Joe Rogers. It's plebs.
[00:55:29] Unknown:
No. It's definitely plebs. Joe's right on this one.
[00:55:32] Unknown:
Nice, plebs. And then
[00:55:35] Unknown:
and then as for and I I'm just gonna show this guy because he's become a friend of mine because he's just been such a good such a good supplier for me, and I've never had issues or anything, and then I have problems. I just call him directly is, Nick Foster at Kaboom Racks. There's a there's a Telegram marketplace at Kaboom Racks, and you can just go and watch. A lot of times, there's large minimum order quantities, so you might not like, you might want a single m 31 s, but minimum order quantity is 20, just hit me up. I can pile some people together, and we'll go all in on it together. That's not a big deal. I know he kinda likes a couple places that he likes too, though. So
[00:56:23] Unknown:
Yeah. The Before we move to, Eco, just real quick, how does that process with Kaboomrax work? It's like you it's a Telegram channel, and then it's like an OTC deal. I guess you have to, like, DM Nick and then process the deal separately?
[00:56:38] Unknown:
Yeah. Yeah. It's a marketplace where only only Kaboom Racks puts listings up. And if you want something, it'll tell you if you wanna do it yourself, there's a link right there in the in the listing. And then, like, I'll just call I'll just call them when I want something or whatever, and we hook something up. We hook up the deal.
[00:57:00] Unknown:
Awesome. Okay. You go.
[00:57:02] Unknown:
I I was just gonna add the Telegram channel, hardware market verified listings. And, you know, that's where Nick from Kaboomer Axle post some stuff. So Nick's got a really good reputation in the community, so does Blockware Solutions, and so does Mindfarmbuy. And all those guys post in that channel. But, you know, I when people ask me, I recommend going to that channel and searching there. Anyone posting in that channel to sell has verified themselves with the admin. You know, they've provided identification documents so the admin knows who they are.
That's not a silver bullet, and, you know, they're they're still can be scammers, so you always wanna proceed with caution. I, myself, almost got scammed out of a quarter of a Bitcoin 6, 8 months ago when I started down this path. Not from that channel, but, you know, going venturing out to doing online searches to buy minors, looking at, like, Amazon ads or eBay ads or going to, you know, whatever website I found that had anything to do with Whatsminer. There's a lot of really elaborate scams out there. There's people standing by that will respond to your emails. They'll convince you that they've got what you want in stock, and they're ready to ship. You just need to send them a payment.
So, you know, just just be careful. And there's also, a Telegram channel for, like, blacklisted scammers. So you can always hop in that channel too and just, like, ping that group and say, hey. Has anyone worked with this person? You have any background on them? Is this a scam? Does this sound fishy? And, you know, there's people out there that'll that'll back you up and let you know what's going on.
[00:58:55] Unknown:
Absolutely. You're so right about that. And and you're talking about a lot of money. If you're buying either 1 one minor new generation, you're talking about you could get a car for that. So don't always run it by someone. I still do. Before I make any type of purchases or anything, I still run it by someone and be like, hey. Will you just take a second look at this? I mean, that's a little bit of that has been alleviated now that that I just deal with Nick at KaboomRacks. But, I mean, I can't tell you not to do it because you could do whatever you want, but I just have not seen anything that seems legit on, like, eBay or sure shit, not Alibaba.
So, I mean, just talk to somebody before you go out on a limb and do something. Like, talk to somebody else. Like, all of us are always here to talk about it. Just hit us up. Like, do not make a big purchase on something that you think is not 100% verified.
[00:59:56] Unknown:
So that's all I can say to that, I guess.
[00:59:59] Unknown:
I mean, a lot of it is, like it's almost like an art. Right? Like, I've I've always had a dream, and I guess it'll happen eventually, where, like, there could be, like, a in store like, big cities could have, like, a location where you could just, like, walk in and, like, buy a miner for cash. It's all But we're not there yet. Already talking about it.
[01:00:19] Unknown:
So And then you gotta pick where your cities are gonna be, and then you'll brick and mortar. And You just put it in a subway location, and you mine in the back. And then put a big Bitcoin sign up instead of the subway sign and then everyone knows you're mining in the back? Yeah. That sounds great. I didn't think that one through. Yeah. If you have an merchant, though, they won't know that you're mining in the back. They'll just see a a a minor storefront, and you rip all the guts out of them. So, like, in the cell phone stores, so nobody's got any incentive to come in and steal anything.
[01:00:49] Unknown:
So My brother's got a eBay story. Right?
[01:00:53] Unknown:
Yeah. This, I covered this in, mining for the streets for anybody that's gonna read it, because as these guys have alluded to, the the scams in this particular area, acquiring acquiring ASICs, they are very elaborate. They're very well done, and and they will follow through all these things. As he said, they'll answer your emails. They'll put up great looking websites. They're they're very, very well done because, as Neil said, this is a lot of money. It's not a joke. And, additionally, generally speaking, you're you're paying in Bitcoin. They want Bitcoin. You're not paying in fiat. So once you send that Bitcoin transaction, there is no customer service to get that returned to you.
So this is a very, very, very important part. It's covered in there, but my, original story whenever I first, wanted to get started was, yes, I hit I hit eBay. A couple of these ads, you'll be able to instantly know that they're a scam because what they're selling is just not physically possible. It defies physics. Alright? They they'll put out a miner that gets 410 terahashes at 900 watts or whatever. I mean, it's ridiculous. So you can, you can you know? Okay. That's that's stupid. That's a scam. But now let me move on to this other one. So I bought the miner. It was listed as brand new.
It was a brand new a one, Ison miner, which is a little bit older, 25 terahashes. So I buy it brand new. I wait. I'm all excited when it gets here. I unbox it, open it up, and it looks as if it has been sitting at the bottom of a landfill for about 3 years, and then somebody just dug it out of the landfill, stuck it in a box, and shipped it to me. It was horrendous. Terrible. Terrible. Filled with dust. Just a very, very bad experience. And so moving on from that is where I found, the Telegram group. Just by happenstance, I found the Telegram group. And it it it is also linked in, Mining for the Streets that's linked in there. There's actually a a a an example ad from specifically from Kaboom Racks. I talked to them before I published the guide, asked them, you know, if it was cool if I went ahead and put one of their one of their ads in. And you can actually it's kind of a cool little time capsule because you can actually go back and look then and see what an s 17 pro, 50 terahash was going for.
It's like $1200, I think. Now they're much more. But the the the very important part is to make sure you're dealing with, on this Telegram channel, you're dealing with verified listings. Make sure not only that they're verified, but that they also have a good reputation in that community. Everybody that's there is willing to help you. They're not gonna spoon feed you, so don't go in there acting all entitled, like, you know, somebody tell me where I could do whatever. But go in there, ask your questions, be a regular person, not an asshole, and everyone will help you out, and they'll guide you, and they'll get you on to a good minor.
[01:04:14] Unknown:
Going back to your, your 420 terahash whatever whatever machine that they were selling. You also have to be careful because my understanding is that MicroBT themselves does not sell miners to retail. They only sell through wholesalers. So you can either have a broker like Kaboom Racks or, like, other other reputable brokers in the industry, or you can buy from these retail sites. But there's no there's no distinguishing one from the other other than what they're offering because they'll they'll have maybe some real miners on there, but then they have these other products that are completely insane. And a normal person looking at that would not know that a 400 terahash machine is not possible. They would just say, okay. Well, why wouldn't I spend $10 on a 400 terahash machine when my only other option is spending $5 on a 100 terahash machine. So the numbers aren't crazy to to to somebody that doesn't know any better, but it's it's a scam. So you don't know which ones actually have a relationship with with these larger manufacturers, and you can really get hurt doing stuff like that.
[01:05:48] Unknown:
Yeah. And that goes back to just reaching out to someone in the community and just trying to get a second set of eyes on what you're doing.
[01:05:57] Unknown:
Yeah. It takes 30 seconds. It takes 30 seconds to DM 1 of us and say, hey. Does this look legit to you or not? And Yeah. Typically typically, any of us could just glance at it or anyone in the mining community could just glance at it and be like, no. The the numbers aren't even close to what's even possible in this world.
[01:06:23] Unknown:
Okay. So, I mean, I think, we nailed acquiring a miner, acquiring some hardware. So I guess the next process is setting up your miner. Where do we start there?
[01:06:37] Unknown:
Start with Evo. I don't know if you call it a while. Yeah. I I think infrastructure is the biggest consideration. You know, you've got, you're gonna need 240 volt power supply, and then you're gonna have a lot of hot air that you need to deal with. My particular miner was nearly a 150 degrees at the output fan, so you're gonna have to do something with that hot air. And then you got all the noise. You you know, you're gonna have a machine that's running close to 90 decibels, which is about the same as standing 10 feet away from a freight train as it rolls by. So what, you know, what are you gonna do about the sound?
Do you have a family? Are there is your wife gonna leave you because You know, if you do need to I'll start with electrical. If you do need to do electrical work and you're not comfortable, like, handling that yourself, hire a licensed professional and be aware that there are scammers everywhere. I had a bad experience even though I'm, you know, sufficient at doing electrical work myself and comfortable enough to do it. I didn't really have the time to do it. So I I reached out and hired somebody. They were not licensed, and and that digressed very quickly.
They did some damage to my house. They put my family in danger because of the way they left the electrical panel. And so that was really eye opening. That that relationship didn't end well, and I ended up going back and fixing everything they did wrong and doing it the way I wanted it to be done. But, yeah, you know, I lost some money and and was put at a risk doing that. So definitely vet your electricians, but get a licensed one if you're not comfortable doing that work. You know, for one minor, it's gonna pull, like, 5th nearly 15 amps at 240 volts. So depending on where you put this machine it may be easy to run it into your garage or you may have a shed out in your backyard that you're gonna run a line out to, or it may be in your basement. So, you know, just be thinking about that stuff leading up to ordering an ASIC.
And then after you place your order, it's gonna take a few weeks to get your machine in. And I I think that's really the time when you wanna start gearing up and building out your infrastructure.
[01:09:15] Unknown:
Is it is there anything else you guys wanna add on electrical? I don't know. I don't know if there's anything to add to that. You kinda nailed it. I mean, if you're gonna if you're gonna start building bigger, then you're probably better off having a a licensed professional do it. Because if you wanna bring in new power, like, say, you've exceeded your typical 100 or 200 amp residential power and you wanna increase that, you need to show that somebody actually did that that that was licensed to do so. Like, you're gonna run into those issues then if you're depending on how how you're scaling up. But, I mean, like you were saying, for for a couple minors, you're probably fine. Slap a new breaker in. You're probably not maxed out on your current panel's capacity.
Run 2, 3 maybe even. But you always wanna leave you also want always wanna leave extra. So if you're running if you're running a minor 15 amp draw like you're saying, you want that on a 20 amp breaker and you want to just cut that 20 amps straight off of whatever your service available is. Because if you start if you don't give it that extra 25%, 20, 25%, you start blowing shit up like crazy, like we were doing. I mean, like, we were blowing cords. We were blowing breakers. Like, it was and that was because we were running it a little higher, but close to what the miner's top draw is. But you don't know extenuating circumstances.
Like, it starts to draw for some reason because it like, they'll they'll just rev up at one point, and then it'll start drawing more than what like, the surge the surge of draw can screw you, especially if more than 1 miner surges at once. You're just literally exploding things. I had I had to leave work. I thought I was burning a I thought I was burning a barn down one day.
[01:11:20] Unknown:
It's scary.
[01:11:22] Unknown:
Yeah. Me, personally, I I'm not an electrician. I know just enough about electricity to, get myself killed. So, I I just hired a a a licensed electrician. If I'm remembering it correctly, it cost me around $300, to get it in because it depending on where you're at, like, in the United States, your residential, like, you know, especially if you're living, like, apartment or a rental or whatever, most of the time, what you're gonna have is gonna be, you know, 110, 120, outlets, your normal regular outlets. These newer generation miners, they they won't run on that. Now you can run, some s nines, depending on, you know, the firmware.
You can run some s nines on 110. So it is possible, to to have 110 if you're running, say, an s nine with brains or whatever. You can you can actually get, get a functioning miner that way. But for any of the newer generation miners, you're gonna need to go ahead and upgrade your electricity, and make sure that you have, adequate actual outlets, themselves. And I, you know, again, I keep going back to the guide, but I I try to put as much as I can in there. And there's I've got links and stuff in there to to all the equipment that I use, to actually plug in both of the cords. There's 2 cords on on the s 17.
So, yeah, it's definitely something to to look into and understand before you buy the miner. This is this we actually should've probably done this step 1 because step 1 is actually to understand this is what I'm gonna need before I get this minor. Because if you get it in your house and then you realize, oh, wait. I I I don't have, you know, 2 40 outlets. I don't have all this stuff. Then you're you're playing catch up.
[01:13:12] Unknown:
Yeah. You did definitely say that originally too. You said step 1 was infrastructure, and, we all just skipped right over the most important part of the structure. But, like, s nines are all are all, dual voltage. You can run them on 110 or 220. I think all of them will do that. You you'll run into a problem with your actual core your power cord if it's not rated for 220 on a on an s nine. But, I mean, otherwise, you can plug it in on your countertop like a toaster if you want to. That'll that'll run on any regular outlet as long as you don't have too much other draw. Like, you can't run your microwave and your s nine on the same on the same receptacle or the same breaker.
But anything larger in that, you are correct, is 220. So you're talking the type of draw that's gonna come from your air conditioner, Or if you have an electric stove, that's gonna be 2 20, electric dryer, things like that. So you may have those outlets available to you in your home, but you're going to you can't run anything else on it because there's no way that any of those breakers are rated for more than 20 amps. And you should probably even check the breaker to make sure it's not 15 amps, because if it's 15 amps, then you're gonna have a bad time.
[01:14:35] Unknown:
Yeah. It's definitely ideal to have a dedicated circuit for your miner.
[01:14:40] Unknown:
Yeah. Absolutely. Absolutely. And then so what we do with the, when we're running 10 on our on our bread rack is we actually run a subpanel right on the rack, which is a 100 amps. Wait. Do we run we are on 2. It's 200 amps. My bad. So, essentially, you leave that room. You got the you got the 150 amps from the miners themselves that you're that you're pulling off of each of the panels, dedicated breaker for each individual miner, and then, you have the extra 50 amps in case something happens. You're not in trouble. But, I mean, we were running it off of a off a dedicated circuit for for arc welding, and we melted the thing right off the wall.
It absolutely exploded. It melted right off the wall because it just wasn't rated high enough. You gotta be so careful about that, and that's going back to the original point why you want a licensed professional to be doing this stuff. You can legally do it on your own, but that doesn't mean you can safely do it on your own, and it'll kill you. That's another big point. Don't do anything that you're not comfortable with that you think might kill you. Yeah. Electric's a bitch. Also,
[01:16:04] Unknown:
as Diverter mentioned, it's not as expensive as you'd think it would be, especially if you're buying one of these new gen miners for, like, 4 k, 5 k. You know, it's it's also a cost that will bear fruition in the future if you own the place. I know we have all American miners here, but I think in Europe, 2 20 is the standard. I don't know how that changes the conversation. I assume, you know, they still can't handle the amperage. I mean, you regardless, you wanna get it all checked out before you jump right in. Right?
[01:16:42] Unknown:
Yeah. Definitely. And I I think as long as you got a dedicated circuit that's just for that minor like, even if you are in Europe, you've got standard 2 20 outlets. You know, you should have individual circuits throughout the house, and you just wanna make sure one of those is dedicated for your minor.
[01:17:00] Unknown:
A lot of new construction in, once again, the disclaimers throughout this whole episode are you should make sure everything on your own with with a licensed electrician. But I think a lot of new construction in the United States, especially in hot places, the the AC's the the AC outlets have a dedicated circuit a lot of times, a dedicated 220.
[01:17:24] Unknown:
I think so. Yeah. Always.
[01:17:26] Unknown:
Yeah. Always. Like like, right under the window, like, if you're in a if you're in a new Oh, you're talking they have the window unit.
[01:17:33] Unknown:
Oh, okay. Okay. I thought you were talking about, like, a outdoor AC unit. A lot of times, they'll actually even have a dedicated subpanel where they pull off of the main panel, and then you have your own breaker in a different panel, especially for smaller smaller places like the condos here, this only has this only has a 100 amps. So when I was running 3 s nines and an m 32 here, I mean, like, I was maxing everything out. There was no there was no turning on an air conditioner or running the dryer or I kept my refrigerator unplugged for a while because I didn't know how much drop was gonna be on the overall system. But, yeah, an air conditioner is always gonna be on its own breaker. Your electric stove is always gonna be on its own breaker, things like that.
[01:18:25] Unknown:
Another thing I did too when I was gearing up to receive my ASIC, I contacted my utility provider, and they had a program called, peak demand pricing. So I recommend anyone looking into this to contact their utility provider and see if they have peak demand pricing, which will reduce your overall electric cost by, charging one rate during peak demand hours and then charging a lower rate, during off hours off peak hours. And you can you know, I I I was running at, 12¢ a kilowatt hour, but then the electric company came out, swapped my meter with this peak demand pricing meter, and it reduced my average electric cost over 24 hours to 8¢ a kilowatt hour. So I saved a 3rd right off the top by doing that.
[01:19:26] Unknown:
And see, for me for me, it kind of, it it was similar, but instead of rather doing it on the daily basis because I live in a majority majority of the year, it's a cold climate here in Minnesota. So they did nobody's running their air conditioners in the winter, so they're not using as much electricity, but they're still they're still have the capacity to produce it. Instead, they're trying to conserve money on the, well, coal or natural gas or whatever. Well, I guess it would be natural gas. It wouldn't be coal. They'll be heating their homes with coal. But, so they actually wanted to conserve on their natural gas usage on the residential level so they would give you a break for the between May or between The winter month. Over in May, they would they would give you a reduced rate just on electricity use usage. So it's kinda like what you're talking about because it's it's off peak, but rather than being daily off peak, it is seasonal off peak. So
[01:20:34] Unknown:
Usually, off peak is is either winter. I mean, if you're not in a place where most people are using electric heat, which I guess is a lot of Europe, or nighttime. Right? Nighttime, usually, electric usage goes down. People don't have their TVs on. Their ACs are turned to a higher temperature.
[01:20:50] Unknown:
They're under the blink. That's a sounder thing, though, too. It's, like, ACs here in here in Minnesota, your AC unit uses electric. So your the ace the overall AC cons or the electric consumption in the summer is way higher, whereas in the winter, nobody's running their air conditioning units. They're instead burning natural gas in their furnaces. So they want to try to balance that a little bit so they'll give you an incredible rate. All you have to do is call them if you live in a cold
[01:21:20] Unknown:
climate. Awesome. So, I mean, we nailed down power. I mean, power is is the most notable both infrastructures, thing you have to deal with and also, cost wise when you're trying to figure out, you know, what your bottom line is when you're running these miners, what your power cost is. The other two things you have with setup are managing heat and, Internet connection. I mean, the Internet connection is is fairly simple. You just you need an Ethernet. Obviously, latent connection, that's better, but it's not like a video game thing. I mean, you don't have to have the best Internet in the world. Right? Like, there's there's these guys running off grid with, like, bullshit cell Internet. I have,
[01:22:04] Unknown:
it's called an Orbi. It's I think it's a Netgear product. All of my miners run wirelessly. You you can't there is no Wi Fi unit in the miner itself, so it does still need to be plugged in with an Ethernet cord. But you just send those to a splitter, and then the splitter is connected to this wireless. They call it a mesh network, but, I mean, it's it's not. It's just like a really powerful, Wi Fi system. So as long as you're I think the furthest the furthest mine goes is close to a quarter mile. I still have Wi Fi on my phone when I'm driving. So and the latency is not an issue. I mean, I run security cameras.
I run, fuck, 20 minuteers. It's all fine. It all runs fine off of this one Orbi unit. I can take a picture of it later and send it out to people, but that's how I did it everywhere. Like so I only pay for, Internet in one condo, but it broadcasts Internet signal out to all the condos. And then at, at the other sites, same deal. We weren't gonna we weren't gonna trench a new Ethernet cord through the yards and through wherever, so you just run it run it off of the same. And as long as you're as long as you're plugging in Ethernet cords into this wireless
[01:23:42] Unknown:
router deal. So Wi Fi access point is the word you're looking for. There we go. Thank you. Yeah. It's basically just turns Wi Fi into Ethernet. The so we have Internet is is a is should be relatively easy, especially if it's a home miner. So the last two things are heat and noise. How should people go about managing that?
[01:24:07] Unknown:
My approach with the sound was to I I kinda took diverter's idea from the he had a, like, a Coleman cooler that he had the ASIC in. So I kinda took the idea of that enclosure, but I I made mine out of MDF and plywood. And then I I put 6 inch ductwork on either end so that I that I could still get adequate airflow through the enclosure. And and it didn't come out as good as I wanted, but I did attenuate the sound by 10 decibels, which which is actually, like, perceived by the human ear that sounds about half as loud, as it would without the enclosure. So, that came out pretty well. If if I were gonna do it again, I would recommend using fire rated materials just in case the ACIT catches on fire. You don't wanna just have it sitting inside a kindling box, but, that was my approach to the sound.
[01:25:10] Unknown:
Yeah. So the the sound, if you're not doing, immersion mining, which we can talk about, and I guess Neil can get into it a little bit more later since he's looking into it, Your sound is coming from your fans. Alright. When these fans, on your miter, depending on your design, the the watch miners are a single tube basic, so they have a single intake fan and a single, exhaust fan. The new generation, Bitmain and Miners are a dual tube ASIC, so they had 2 intake fans and 2 exhaust fans. But these fans are what create, your noise, and the entire purpose of those fans is to cool down the chips, is to keep your miner cool.
So what I did, and everybody kind of that I talked to about it kinda said I was crazy or stupid or I was gonna mess a minor up or whatever, but, I'm sitting here nearly 2 years on on this exact setup and haven't had a single problem. What I figure is if if these fans kick on to keep the miner cool, and that's where my noise comes from, well, then if I can just keep this miner as cool as possible, then those fans don't have to run very hard. The fans don't run very hard, the noise goes down. So I focus on getting cool air intake into my miner.
The way I solve that very, very simply and very, very crudely as with everything to do with my setup. It's extremely, trailer park, my setup is, is I I just shoot cool air from a window air conditioning unit through ductwork as talked about, and I I I shoot it into the miner. It keeps the miner extremely cool. Sometimes, a lot of time, actually, the window air conditioning unit is kind of a little bit louder than the miner itself, just because those fans are only running at about 3,000 RPMs or or even lower than that. So the point I'm getting at here is the cooler that you can keep your environment where your miner is at, the the lower, the sound output should be.
[01:27:30] Unknown:
Yeah. And then excuse me. And in a cooler, you can keep it the more static of an environment the miner itself is in. So then, therefore, you have the added benefit of like, I was talking about earlier. The miners like computers like a static environment. So you're you're keeping the airflow going through it at a pretty pretty reasonable rate.
[01:27:57] Unknown:
Right. And there's, there are 3 d printed, there there there are 3 d three d printed, how I'm blanking on the word.
[01:28:10] Unknown:
It's like a bezel.
[01:28:11] Unknown:
Yeah. What what that's that's absolutely not the word I was gonna say, but I'll tell you that.
[01:28:17] Unknown:
I know what you're talking about. Some of the clients have gone off with them. The ones that sent me already had them on. They were not a not a baffle, but, like, it connected directly into that tubing. It was, like, a separate size.
[01:28:32] Unknown:
And they use the screws right from the ASIC itself, so there's no, like, extra screws. There's no extra things you have to do. You can order these off eBay. I linked to them in mind for the streets for anybody interested. Yeah. Muffler. They're they're linked in there, though. So you can look in there and see, for cheap, you know, just a few dollars, you can, buy them and just take the screws out of the fans, put those on, and then throw your screws right back in there. And you can set up your ducting, so that you it it makes it much easier to get everything set up.
Yeah. So look into those.
[01:29:06] Unknown:
But, yeah, when you're talking about when you're talking about heat, so I was saying this condo, it's a 1000 1000 square foot condo, had 3 s nines and an m 32 running in the basement. The dead of winter, it was probably 0, 0 degrees Fahrenheit. Maybe it was close to negative 10 at times. I'd have windows open because it was just heating the place up so much. That's how much heat it was putting off. So just take that into account when you're when you're thinking about, like, okay. I'm gonna mine this in my garage in Arizona. 1 s nine is gonna make your Arizona garage unbearable depending on the ambient temperature outside.
Yeah.
[01:29:54] Unknown:
You've gotta get the hot air out. You've gotta get the hot air. Like I said, it's a very simple concept. The concept itself is extremely simple. Cool air in, hot air out. You know, I haven't really I haven't really,
[01:30:05] Unknown:
made up my made up my mind yet on what's more important because the cool air in will keep the miner quieter, but the warm air out, it's almost like individual thing. Your specific your specific situation determines that. But then that's why, again, like, me and my brother are working on this this immersion thing. We've we've looked into all the immersion setups there are and been screwed over on a few of them. And so we're just gonna build our own now. We just figured that, okay, nobody's nobody's gonna work with us in in the way that we would work with them. Like, they're not they're not making good on their end, so we're just gonna build our own.
So that eliminates and it kinda goes back to what I was talking about earlier. You can have 20 minuteers in your garage in Arizona then if you have one of these immersion setups and you put in the power to to maintain said setup. But, it gets rid of it gets rid of everything. Preserves the miner. It increases the longevity of the miner. You're eliminating noise because you're taking all the fans off. You're actually increasing its efficiency because the fans themselves are a drain. I think you increase the efficiency of the minor by, like, 15 or 20% just by taking the fans off, and then you dissipate the heat. You're gonna you're gonna lose a little bit of that efficiency on the other end because you have to now cool down that liquid. So if you have a dry cooler outside, that's gonna that's gonna cost you something to run, but those dry coolers were manufactured to be as efficient as possible for businesses and things like that.
So you're still saving on the efficiency. You're you're making your family sane again, and you can increase the size of your operation because you would never be able to do that otherwise given the constraints of everything else.
[01:32:21] Unknown:
Yeah. There's one guy just that I remember that I recall, talking about, you know, this this concept of individuals at home doing, immersion mining. Of course, there's a little bit more to immersion side of it than there is, you know, just buying a Coleman cooler and cutting a couple holes in it, which is what I literally did. But on Twitter, you guys can check out there's a there's a good thread and and information, by a guy, Evan Utstrand, evenutstrend@evenutstrand. And he he put out a really good thread showing how he had taken, a minor and set up an an immersion set up in his home. So that might be worth checking out for you.
[01:33:09] Unknown:
Yeah. You start to run into economies of scale, though. Like, the larger the the larger you can make your operation if you're running an immersion, the better off you are just because of the the capital expenditure that you have to you have to front load. Like because you have to buy all this stuff. You have to buy all the equipment to do it, the cooler, the plumbing, the heat exchangers, the tanks, everything like that. You don't necessarily wanna do that for 1 or 2 miners because it's all the it's it's all the cost with really none of the benefit.
[01:33:49] Unknown:
Whereas I tend to Go ahead. I tend to agree. I agree. I I don't I think immersion for individual minors is probably, a little much, personally. I I don't think that it's that necessary. And and as you said, for the for the added cost and, energy expenditure or time expenditure that you'd have to put into it, I personally feel like, you can if you put just even a part of that energy and time and money into, dealing with a simple air intake, and exhaust, you could probably come out with a with a really good setup. So, yeah, I tend to agree.
But, you know, having said that, the there like I said, there's a guy on Twitter you can check out. He has done it. Maybe ask him some questions. I'm sure he'd probably be willing to talk to you about it. Yeah. And I remember what I was gonna say earlier now actually about,
[01:34:42] Unknown:
it was it was way back. One of the earlier topics that we were on was, it's kind of the same concept as if you're a small miner, like and I'm talking you're not in an industrial mining farm. Efficiency of a miner isn't to me to me isn't necessarily as productive of a metric as price per terahash. Because when you're when you're paying a lower price per terahash for the miner itself, you're you're front loading your savings. Okay? So you have a less efficient machine, but you save $2,000 on the machine. The efficiency itself is going to take you years to recoup at a couple cents a day to get to to earn back that $2,000 that you saved initially.
And then you just throw that $2,000 that you saved initially into a little side account, and you just wait it out in case something bad happens. Like, that's where you get your money. You buy miners cheap, and that's where you get your money to float yourself through any bad times or anything like that. Like, rather than, okay, every day, I make 3¢ more out of efficiency than than I would have otherwise. I skipped topics. I went way back. Sorry about that. Back to the immersion thing now. Well, I mean, to
[01:36:18] Unknown:
to bring it back to immersion, I mean, you you mentioned on immersion there's some economies of scale there. There are a lot of economies of scale with mining in general, between negotiating power contracts and negotiating large hardware purchases. I mean, we talked about KaboomRacks earlier about how they require bulk buys a lot of the time. That's even more so if you're trying to go, you know, completely wholesale. But one aspect of a diseconomy of scale with mining is capturing that waste heat. Right? So if you're a miner in a in a cold environment, if you can find some use for that heat, you all of a sudden, you have an advantage that a larger miner doesn't have. Right?
[01:37:03] Unknown:
Yeah. Absolutely. And even even on a even on a, yeah, even on the most minute scale, like I was saying with the condos, I didn't have I didn't have any heating bills for an entire winter because you're capturing that heat just and that was just that was just increasing the ambient air temperature of a 1,000 square foot condo. So, I mean, you can you can use that in any way you want. And then with the immersion, you actually capture all of the heat. There is no there is no dispersed heat from it. It's all in the liquid. And then you use a plate exchanger to swap that out for in what in in our design is we're we're literally just swapping that out for glycol mixture, which we then dissipate outdoors during a cold during during a cold or hot season.
But you could use that same plate exchanger to swap that heat out into any type of mixture. The reason why we use a glycol is because it gets 0 degrees here or negative 20 degrees here. So we need the glycol to not freeze on us. Otherwise, we'd be running the dielectric fluid itself out to the pump. But if you're actually if you actually have a use for the heat, then you just instead of using the plate exchanger to swap the dielectric heat the dielectric fluid heat into a glycol that's going outdoors, you swap that in anything you want. Like, I was talking about in floor heating or your water heater, like, you'd mentioned, anything. Anything you need heat for. But the problem is is you need like, heat is you still need to use that heat. Like, if you have a water heater and you're swapping the heat out, that water heater is gonna get hot, and then you better be using a hell of a lot of hot water because, otherwise, that hot water heater is gonna keep getting hotter.
Like, you need you need some sort of way to continue to dissipate it. So, like, heating heating your backyard pool in the middle of winter, that might work because there might be enough volume of water there, and there might be enough surface area to dissipate that. But, I mean, you'd have to you'd have to be you'd have to do the calculations on that to see if you could even get rid of that amount of heat in that why I like
[01:39:34] Unknown:
that's why, like, specifically, I really like the idea of of, like, landlords getting into mining, you know, like, in 5 years or something. Because then if you have, like, a full building, I mean, that hot water is just constantly getting used.
[01:39:47] Unknown:
Yeah. Exactly. And then, well, for you for you particularly in New York, boilers. Right. The boiler is a far better use of because it's a constant heat, and it's circulating through radiators. And and the majority of New York apartments, I would assume, still have radiators. I don't know that for a fact. But
[01:40:11] Unknown:
You are correct.
[01:40:12] Unknown:
Okay. Yeah. There's a lot of things you can do with hot water. I mean, you could steam water even if you wanted to. You could keep pushing the same heat into the same boiler and
[01:40:22] Unknown:
whatever. Well, that's how, like, radiator boiler heat works. Right? Like, you just create steam. The steam rises through the pipes. It's actually kind of magically, magically simple kind of in the way that Bitcoin's magically simple, but, I mean, I'm kinda getting sidetracked. But it just the steam goes up, and then it collects, and it goes right back down the same pipe. It's just a single pipe that goes up to the apartment while you hear the clanking.
[01:40:46] Unknown:
Let me clank let me, hop on that real quick while you gave me an idea. So there is 2 definite different versions of immersion cooling. There is the one that I've been explaining that we're doing because it's simple, it's easy. It is you heat up the dielectric fluid. You swap the heat out of that fluid into a different fluid, which you can then utilize or disperse somewhere else. But then you have 2 phase dielectric fluid, which is, in my opinion, not a great solution for multiple reasons. Let me get in let me first explain what 2 phase dielectric fluid is, and then I'll tell you why. I don't think it's a very good idea. You've seen those you've seen those videos of of the boards themselves submerged in some liquid, and it's and each chip is constantly boiling off a gas.
And it's the fluid, and it's cooling the it's cooling the the chips on the board, but it's turning into a gas. So then you need, first of all, a closed system. Like, you need to actually, like, lock that down because you don't wanna lose that gas. That's a very expensive gas because it's your dielectric fluid. But then you also need a condenser to condense it back down. So those are those are 2 bad problems just to begin with. And then thirdly, I've heard, and it is my opinion as such, but I don't I haven't looked into it, so I don't know. But every single time one of those bubbles forms on the chip and closes down to boil off the liquid, that's a vacuum.
So that is not what I've been preaching this whole time about keeping your miner in a static environment. That's not a static environment. You're over the life of the miner, who knows how many times that it had a vacuum bubble around each chip, and then it closes back down on the chip? There's force to that. It might not seem like a big deal, but, I mean, if you're trying to if you're trying to extend the longevity of one of these things for 10 years, like, you don't want you don't want that extra trauma on it constantly, and you don't want you don't want it to go a split second without any cooling whatsoever. Because as soon as that bubble forms, it has no cooling actually touching the chip itself.
So that's just that it's a theory of mine. I haven't looked into it. It's just something that I've thought about. So there's 2 there's 2 definite different types of immersion cooling, and I think the one that we're going with is probably going to be the successor.
[01:43:36] Unknown:
I didn't realize there was that much to immersion cooling. I I thought it was just like heating up some liquid, running it through a radiator, and then putting it back in the tank. But it it's interesting to hear all the details.
[01:43:51] Unknown:
Oh, yeah. It's super fascinating. Every every every facet of it is that is is incredibly interesting. And so that again, going back to my brother, that's why that's why he's so been so instrumental to what I've been trying to do or what we've been trying to do is he gets he gets that type of stuff. Like, he understands flow rates and temperature swaps and things like that. So, like, I I was in a privileged position to begin with to even have a brother like that that's like, yeah. Let's do it. That's this is what we're doing now. And then, it really it really comes down to is it's crazy how bad the supply lines have be have become. Like, the only reason why we don't have a working prototype right now is because supply lines have completely gone to hell.
We can't even we can't even source a dry cooler. I've been looking everywhere, and thank God for the plebes. People been reaching out to me saying, hey. My brother might have a line on something like that. My brother works with something like this, or how about this guy? And, I mean, the the best lead I have so far is a, motorsports manufacturing company. He's like, yeah. We'll just we'll just design one for you. Give us the specs. So that's pretty crazy.
[01:45:19] Unknown:
Wow. I love that we have big corners everywhere in every single industry. Okay. So, I mean, this has been very insightful so far so far. I I guess I mean, unless Eco and Diverter have more questions for Neil on immersion, I mean, I guess the next question that, most freaks would ask is choosing your mining pool. How do they go about that? What are your thoughts there?
[01:45:48] Unknown:
I mean, I think all I think all 3 of us are mining with Slush Pool. Right?
[01:45:54] Unknown:
Yeah. I don't really see a reason why not to. I started for different reasons than what are my reasons now. I was actually I was actually, under the impression that originally, when I started, like because I didn't know anything about mining when I started. I thought that they were the only public mining pool that wasn't located in China. So I was like, well, that's an easy decision. Right. And then now my reason has completely changed. I don't see any other mining pools doing anything for the community or for, like, coming out with new firmware, like, flashing new firmware on your miners. That was I would never do that. I would never ever do that before Slushpool came out with the brains OS because nothing could be trusted. It was all foreign firmware that hasn't been tested at all, or the people that have had been using it. You don't know whether or not they're lying and they just work for the firmware people. And, like, firmware is a dangerous thing. You don't just put firmware on on something that means a lot to you, like a piece of equipment that means a lot to you. You don't just put random firmware on it because you're gonna get an extra t tear or ashes out of it.
So that was kinda that was kinda my take on that. And now now for me, it's like they've done more to give back to the Bitcoin community than, well, than any pool. I don't think any pool has done anything. That's kinda where I'll leave it, I guess.
[01:47:44] Unknown:
I found him from Diverter and Crazy k. They they had made the suggestion to try out Slush Pool and, you know, I I really like that they had a mobile app so I could monitor my a six performance while I was out of the house. And it was just really easy to set up. And I just kinda stuck with it. I I haven't had any reason to change.
[01:48:08] Unknown:
So when, when you're talking about mining pools, you know, it it's basically, the payout structure is a little bit different. I am on slush pool now, but, there have been plenty of times where, I I was mining with pooling. Slush pool, The way that they're designed, is basically to incentivize you to stay on slush pool, to not hop back and forth between, different mining pools because you get paid for the last number of shares since they found a block. I'm not gonna get into the whole payout structure that much, but the point is they try to keep you staying there instead of hopping around at different pools. Because as a miner, to change where you are mining at, I mean, to change what mining pool you're on is literally a single click, which is why, you know, you see people talk about, you know, there's x amount of percentage of, mining is being done in China, but what they were actually talking about was these mining pools.
That's that's not necessarily that's not mining in China. The machines aren't in China. Those were Chinese mining pools that people were pointing hash at. That could be changed with a click. Right. The thing about the thing about slush pool is, in general, when we're talking about Bitcoin and Bitcoin history, slush pull, in general, in my opinion, has been on what I would call the right side of Bitcoin history, throughout, you know, the different events in Bitcoin. So they've garnered a very high reputation in in the community for, you know, for for being that. Now it may be that your specific setup, you would rather have a a payout where you are guaranteed to get a set amount, depending on the number of, hashes that you provide, not depending on whether the pool actually finds a block. That's how slush pool is set up. You get paid when they find a block.
What I'll say to that though is over a long enough time scale I found in my personal experience over a over a time scale of, like, a week or 2 or or even a difficulty epoch, generally speaking, you're usually gonna come out about the same. You'll make about the same amount of money with a little bit of variation. The one thing I'll say about about pools, before we're going on is this is a region that I think, regulators haven't yet gotten to, but I believe they're coming for, probably in fairly short order. I'm of the opinion that, what we will see in the future is we will see regulators attempt to treat mining pools as money transmitters.
And the reason for that is if you set up mining on slush pool, what happens whenever you get, whenever you're mining and you're earning Bitcoin, that Bitcoin is actually going to Slush Pool. That's not going directly into your wallet. Alright? And then once you hit a certain payout threshold, whatever you set that threshold at, whether it's point 1 or whatever the case may be, once you hit that threshold, then slush pull transfers you, the amount of Bitcoin that you've earned. So what I believe is regulators will make a move on that front. They will attempt to classify mining pools as money transmitters, and then what they will attempt to do is force mining pools to institute KYC for, anybody hook hooking up to their pool. Because as it stands right now, you don't have to do anything. You just you can just create an account with an email or whatever. Sometimes you don't even need that. You can just you can do it in an anonymous mode, like Luxor pool, anonymously, all that.
So, it's very simple. But what I believe KYC is coming to mining pools, in my opinion. Could be wrong. So one pool that it doesn't get talked about very much, but, that I think their payout structure in the future will become more and more important is, and I'm gonna probably pronounce this wrong, Laurentia Pool Laurentia Pool. However it's pronounced. Laurentia. It's a Mind Farm Buy. It's the pool that, he is involved with. And the reason that that's different is they pay out direct from the Coinbase. Alright? It's a direct from Coinbase payout. So there is no custody, that you're when you're mining, you don't mine to the rent your pool and then they transfer it to you.
This is a a when when you get a payout from a block reward, the Coinbase payout itself actually pays the miners. So I think that's gonna be very important. Right now, I'm not mining with them, for a few reasons. One of those being that the miner that I use, I run s 17 pro 50 terahash models. Those are the miners that I run. I can't hook up to that mining pool just because of a technical hookup situation. But the point I'm getting at is, I feel like this is a payout structure that I think we'll see more pools either be forced to move to or, implement KYC on their miners. I believe that's coming.
[01:53:29] Unknown:
So I think, my take on that I I I agree with you 100%, of course. But the the Stratum V2 the Stratum V2, I haven't looked into it enough to speak on it fully, but my understanding of it is that it allows individual miners to construct their own blocks. So then therefore and that's something Slushpool is working on right now. So why wouldn't I pay my why wouldn't I pay my minor fees to a pool that is actively working to basically make themselves obsolete? Like, they must have some sort of business plan for the future, whereas they they see a different way to financialize the mining pool market.
Because once that happens, then all transactions get paid out to my understanding of it. Correct me if I'm wrong.
[01:54:27] Unknown:
Let me just jump in here real quick. First of all, Laurentia Pool, I also probably pronounced it wrong, is a really cool concept. Major negative with Laurentia Pool is that no one knows how to pronounce it. I mean, I I love your mind farm by, but, to work on an easier name. I I will put the link in the show notes. For the video freaks, I put the link, directly in the video feed. The 2 main trade offs of of Laurentia Pool right now is, first of all, the the hash is low. So if you have a lower hash, oh, turns out that I pronounced it correctly. Fuck yes. We have Mind Farm Buy in the chat right now. The the payout is less.
You have more variance. Right? So the amount that if on a long term basis, when you're talking about a smaller hash pool, and you gotta start somewhere, obviously, you have more variance. So, your payouts are a longer time between payouts, but on a long time scale, it should even out. And then the second issue with, Coinbase payouts is obviously, you're paying, you're paying more in minor fees. Right? Because you're gonna get a lot of small payouts instead of 1 large payout. I also share their fears with Diverter. The one thing we have going for us is that it is easier to, you know, operate a mining pool in some jurisdiction somewhere that is not enforcing it, at at minimal switching costs as compared to actually moving miners around, moving hardware around.
So, hopefully, we'll have some kind of regular regulatory arbitrage. In the the meanwhile, right now with most pools, what you give them is an email address, which obviously could be a burner, and and they know your IP address if you don't use a VPN. So, I mean, I I think if privacy is your concern, you probably should be running everything through a VPN. To Neil's, comment about Stratum v 2, Stratum v 2 doesn't solve this specific, concern. Stratum v 2, the idea is right now, mining pool operators construct the blocks. They decide what transactions go on a block. With STRATAM v 2, the individual miners decide what what happens in a block, what what transactions get included in a block. So it gives us some censorship resistance in terms of taking away power from, you know, 5 or 6 mining pool operators, large mining pool operators, but the the payouts are still a custodial payout. It still goes to the mining pool operator, and then it goes out separate. I mean, they could obviously do a Coinbase payout just like, Laurentia does, but, but that's not necessarily in the spec. That's separate.
[01:57:03] Unknown:
Yeah. I I I really do think this is something that's gonna matter later, and it's gonna as you as you, alluded to there, it's a a lot of this is gonna be dependent on whether or not, pool operators are, willing to be defiant, which is the case with so much of Bitcoin. You know, right now, we're in a very permissive environment. Even, you know, with the things we're seeing in China and stuff like that, overall, this is we are not anywhere near an adversarial environment yet. The fight is just beginning. And it's gonna take, people that are willing to disobey, willing to not comply, willing to use things like regulatory arbitrage or willing to implement different payout structures. All these things are are are a necessity. It's a necessary part of, in my opinion, of Bitcoin and of being a Bitcoiner.
So, you know, just it's it's something to think about. It's not it's not a problem today. Probably won't be a problem for, you know, a little bit of time to come, but, yeah, I you know, I believe, every pool should be working on, were payout structure where this can be avoided. Because what what I don't want to see is KYC to hook up to a pool. That is that is a death knell.
[01:58:21] Unknown:
So another thing another another reason why like, this this most recent upgrade to slush pool is so you can't do the same payout threshold that you're talking about where where it hits a well, you still can. You still can. Like, okay. So you get to a 1,000,000 sats, and it'll payout to a wallet. The newest the newest upgrade that they just did is you can have several people, several several Bitcoin addresses.
[01:58:52] Unknown:
Excuse me.
[01:58:54] Unknown:
And you can pay out over time. So our our electric bills show up at the exact same time. But instead, now anyone anyone who's involved with anything I have going on, I get to allocate to them whatever percentage they're they've earned from whatever it is that I'm doing. And then the onus is on them to pay me the fiat bill to pay that electric. Like so I'm not so it works out so great for me, and what I have going on is, like, they don't they don't have any concerns anymore. Like, it's paying Bitcoin directly to them, and then they will owe me for the fiat bill. Whether they need to sell their Bitcoin to cover that fiat bill or not is up to them. I don't have to know about it. It's not me juggling. Okay. Well, we made this this amount of Bitcoin at this price at this time, but on 15th, our electric bill is due, so I have to calculate your your percentage of this bill given that it it it eliminates a lot of the volatility for them. Like, they're just getting the Bitcoin that we earned, and they're paying the bill however they wanna pay the bill. Whereas before, when it was just a denominated, okay, every 1,000,000 sats, it pays out to this address, and then now I have to divide that and figure out what the price of Bitcoin is today and the price of your electric in Bitcoin terms is subtract that from that and then pay that. Like, nobody wants that. They're they're mining because they want the Bitcoin. They'll pay the cash for the Bitcoin. They don't care.
Does that make sense?
[02:00:49] Unknown:
Yeah. It totally makes sense. Slushpool's new structure is it adds a lot of flexibility for mining operators. So I I was really happy to see their upgrade. And, you know, there's a just from a privacy standpoint, you know, I I personally have decided to, and and I recommend other people don't reuse addresses to receive mining rewards to, you know, specifically for some of the reasons Diverter was alluding to. You know, if that pool operator wallet becomes a choke point and they're watching the funds that go out of that pool operator's wallet to your personal wallet, you know, that that can be a problem. And one thing you can do to alleviate that is to take your mining rewards and run them through Whirlpool, and then that coin join will break that deterministic link from the pool operator's wallet.
And so if anyone's watching the pool's operator the pool operator's wallet and tracking those funds and it goes through a coin joint, then they're not gonna be able to trace it after that. And then on the other side of the coin join too, when you go to spend your mining rewards however you want, whoever you spend them with will not know that you're mining Bitcoin in case that's something you wanted to keep private.
[02:02:21] Unknown:
So Go ahead. That's a very good point. I I I assume most freaks listened to the last week's dispatch, which was with Samurai Wallet of, Samurai Wallet, one of the cofounders of Samurai Wallet. And we go deep into Whirlpool. I mean, I think Whirlpool should be in the standard toolkit of all Bitcoiners, but it including miners. I just wanted to make, just a quick correction or, clarification. So we're talking about Laurentia Pool earlier, and they pay directly from the Coinbase. That's not the exchange. The the exchange borrowed the term that was a Bitcoin term already. The Coinbase is the first transaction in a block. It's what, the miners construct. It can only be created by the miners. It's the miners paying themselves out. So when I talk about increased fee burden, you actually don't have a fee for the the payout, which is nice. But at some point, you're gonna have to consolidate those small transactions in the future, and then I ideally run them through Whirlpool.
At that point, you're gonna pay a higher transaction fee because the more in general, the more inputs you have in the transaction, the higher your transaction fee. Now I've been wrong about a sustained high fee environment happening. I mean, as you can see today, there was, like, a panic sell, and even that barely moved the mempools. You can still get very low fee transactions, and so it's it's more feasible in a low fee transaction environment. If we have a higher fee transaction environment, that could become an issue because it's gonna affect miner's bottom lines.
[02:03:59] Unknown:
Yeah. Let me think if I can remember the idea that we were talking about the other day. So I wanted to know what the percentage of lightning closes as a fee as a fee percentages on main chain. I was curious about that. I don't know if anyone's closing Lightning Channels right now, But there was this theory that that has blocked subsidy, which I don't subscribe to. I don't given given the trajectory of the iPhone, I don't think anyone could predict what Bitcoin's going to do in 10 years. But there is this theory of when the block subsidy declines, then the fee market may not have developed adequately enough to sustain minors.
So I I I'm kinda a buddy of mine reached out to me, showed me some numbers and stuff. I've just been too busy to look at it, but what do you guys think about that?
[02:05:06] Unknown:
Well, this is one of the things where I was kinda talking about earlier that, you know, relying on altruism is not a a a business model. However, I think there are situations where, especially things some of the things that are being explored right now where it could be that, people are mining not only just for the Bitcoin, reward itself, but for, other purposes such as, to handle flared gas, for example, just first example off the top of my head. So these oil and gas pro producers, they need to take care of this flared gas. Now right now, they you know, it can be done and they could turn a profit and do all the and do all sorts of things. But even if that weren't necessarily profitable, there still could be an incentive there for them to mine because it's a very easy way for them to deal with this flare gas, and and it could still eventually save them money.
So the point that I'm getting at is this network right now is probably over secured. Like, we we don't need this much has to actually secure the network. In a worst case scenario where there is just no fee market has developed, I believe that users can, would just simply end up waiting for, more confirmations. I believe there would be people mining out here that are mining for various reasons. The more that we can get it dispersed into individuals that are looking at this as a DCA mechanism or, you know, any sort of process like that where we further decentralize so that we're not reliant on profit driven huge farms.
I think that's a net win. I don't see it as being an issue personally, but even at looking at a worst case scenario, I still feel like there's areas where people will still be mining even if they weren't necessarily profitable.
[02:07:06] Unknown:
I mean, I'm also hopeful besides, you know, lightning open and closes. I I think, I think CoinJoin represents a base demand, like a reserve demand for a fee space. So, hopefully, if we see coin join usage go up and if every spend is a coin join I mean, when we say every spend is a coin join, it's obviously an optimistic goal, but if a large amount spends are a coin joint, it should increase, fees as well.
[02:07:31] Unknown:
But what if what if there's some and it goes back in my same thing. Nobody could predict anything that's gonna happen in 10 years because it's just simply impossible. But what if what if there is a main chain privacy improvement where coin joins are unnecessary, then you're not gonna have that that base layer fee protection. And I think I think Lightning is gonna accelerate to the point that Lightning channel closes will be, at some point, the the majority of the reward. The subsidy will decline, and I usually don't I usually don't try to speculate out that far in the future. But, I mean, we already saw we already saw 9 Bitcoin block rewards.
And so you're talking 3 bit 3 Bitcoin of that would or, yeah, 3 Bitcoin of that was or a little less than 3 Bitcoin of that was fees. And I don't I I just wanna know how much what percentage of those fees was lightning.
[02:08:42] Unknown:
And now I know that people work At the end of the day at the end of the day, you know, first of all, one of the main advantages of using Lightning is reduced fees, because it's it's basically, Lightning is a batched Bitcoin transaction, a large amount of small transactions that are batched into a single open close. If if if fees are low, then there'll be less demand for lightning. So it's kind of like, it it's more of like a pressure valve, like an escape valve is kind of how I look at it. But, regardless, look, at the end of the day, I think we're all here because we want to see sovereign Bitcoin usage increase.
And I I think if if adoption increases and and demand for main chain Bitcoin doesn't increase, whether that's lightning open and closes, whether that's coin joins, whether that's regular on chain transactions, whether it's miner payouts itself, or, like, the res the transaction after the minor payout if they're coming in through a Coinbase transaction, then we have bigger problems on our hands. Like, I I think, you know, block space is scarce. Demand should increase. On top of all of that, with adoption, price should go up as well. So once that per byte transaction, even if they are confirming at whatever point in the future, should have more purchasing power,
[02:10:00] Unknown:
You know? It's yet to be seen. This is all speculation. Right? Absolutely. Absolutely. And goes right back to my my original point was you can't you can't predict what it's gonna look like because you just there's no way to know.
[02:10:14] Unknown:
Right. Like, I mean, if if the last year has been evidence of that.
[02:10:19] Unknown:
Sorry.
[02:10:20] Unknown:
Continue. No. I was just saying the last year has been evidence of that. Like, when I pulled the trigger on deciding to mine, I was planning on losing 71¢ a day. And now here I am mining Bitcoin for 80% below spot price.
[02:10:35] Unknown:
Right. It's just been a a wild year, and you never know what the road ahead has. And none of us could've seen that coming. We never could've seen that coming. And if you look at, like, if you look at the block subsidy, right, so the part the part of the reward that's not, transaction fees, that obviously halves every 4 years. But where we stand today, it's significantly more than in the last epoch just because the Bitcoin price has increased significantly. The purchasing power of Bitcoin and we say Bitcoin price because we measure it against USD, but, really, what you're measuring it against is labor cost, bread cost, meat cost, real costs, like, actual purchasing power. That purchasing power of that subsidy has increased even though the actual Bitcoin denominated subsidy has decreased.
We've gotten a little bit sidetracked, even though I love this conversation, the freaks have heard a lot of mempool talk, especially since I completely took cake to my face in terms of of our current mempool environment. And I will own that probably every every dispatch until it changes. That's one of the reasons why we stream the live view of the mempools in dispatch is is because I think it's a very good timeline of where we're at. I wanna talk about and I think this is what a lot of freaks are are are gonna be asking at this point. We're 2 hours in. Maybe they're feeling a little bit overwhelmed. Maybe they think their power cost is prohibitively expensive. There's a new crop of Bitcoin mining in this hosted mining. This idea that another company, you know, has custody of your miner and hosts it at some kind of hosting facility for you at a lower power cost and pays you out.
The most famous and successful one being Compass Mining. I'm curious what your guys' opinion is on those trade offs, and is is that something that people should consider?
[02:12:29] Unknown:
Yeah. So I, I alluded to this very briefly in in Mining for the Streets, because the, you know, the fact of the matter is not everyone, has an electricity rate that would allow them, to mine Bitcoin. It just does it. Even even if you are willing to to take, a certain amount of loss, there comes a point where it's just it's just not feasible, or your structure is just not feasible. So there in the past, you know, what we've talked about or what's been advertised around is as you spoke about earlier, cloud mining, which in my opinion is basically a complete and total scan. Don't do cloud mining. It it sucks.
What hosted mining really is, it's it's not cloud mining. It's a different thing. Okay? So you buy a machine. It is yours. You own the machine. Now you have nowhere to actually run that machine, so you send it to a company or you can buy it from them, whatever. They actually physically host the machine, but yet it mines Bitcoin and the payout comes to you. Now, obviously, the very first trade off is not your miner, not your hash. Right? You don't have the mining machine. So what's to stop them from just leaving, taking your machine from not paying you?
All these things come into play, and they're absolutely 100% valid concerns. What I talked about in mining for the streets, was and the experience, I relied on a little bit of anecdotal personal experience with, a guy that I deal with, Crazy Kaye, who's one of the, Ronan guys. He actually won, a a a watch miner. I believe it was an m 30 or I believe it was m 30. He won it in a Twitter giveaway. Like, they actually they just gave it to him, but he couldn't mind. He didn't have anywhere to to be able to put it in his home to where he wouldn't have to, trade in his wife.
[02:14:37] Unknown:
So,
[02:14:39] Unknown:
he he chose the wife, You know, bad you know, we all make bad decisions, I guess, but he chose the wife. And no. Don't don't trade in your wife for minors. Don't do that. But, you know, he his whole thing was, you know, I I he wanted to mine. He wanted to mine Bitcoin. He wanted to earn Bitcoin without having to do full KYC. So he went with a hosting solution. Now the one that he went with is one that's been around for a little while. Compass, I don't know them. They're a little bit newer than Blockware, I believe. What he went with was Blockware Solutions. They had a facility that was hosted in Kentucky.
They offered him, sub 7¢ electricity rate. Now the way that worked is whenever he sent them a machine, he in turn received a full legal contract. Alright? So when he filled out this full legal contract with this company to where, they essentially relieve themselves of all, liability, which as far as, you know, problems with the machine and things of that nature. But he also, you know, was receiving, legal protection from them actually just running off with his machine. So, of course, obviously, if you don't own the miner, if you're if you're putting the miner in somebody else's facility, obviously, that's a massive trade off, and it may be one that you're not willing to make. Fine. But if you're in a situation where you absolutely cannot mine in your home, the biggest thing is what I put in there, don't skimp on reputation to get a little bit of a cheaper, cost.
Because what's gonna happen is, these machines are not cheap. We're talking about, you know, upwards of $10 a piece for one of these machines. So if you send a $10,000 piece of equipment to somebody that you've never seen, never shook their hand, never been in their facility, you know, that that that's a big risk. It's also a risk that, you know, whatever happens, maybe they get raided by somebody. Maybe somebody shuts them down. Maybe they get break in. There's all these risks, but it is a valid, thought process to go through. It's it's a valid option in certain scenarios. I just would highly encourage anyone that can find at home to do so. But if you absolutely can't and you're gonna go with a hosting solution, go with one that has a solid reputation that gives you a legal contract that protects you and protects loss of your machine, and that's the best you can hope for.
[02:17:29] Unknown:
Yeah. I totally agree. I mean, the I I I see the problem that Compass solves. Like, there's there's multiple there's multiple problems that they solve, being whether the heat, the noise, the electricity rate, the electricity availability. Like, that's that those are those are what we've made this whole podcast about today is those are the issues with mining. So if that's not if if even one of those is too much for you to handle, then I understand why you would want to mine, but it's it's counterparty risk. At all times, it's counterparty risk, and you're taking a you're you're essentially taking on the exact same reason or the exact same risk that I personally wasn't willing to do with lending Bitcoin.
Because you're lending them your miner. You're paying them you're paying them a rate to to get all those benefits. You're paying them something. It it's a hosting fee. You're essentially renting from them. And I'm not saying it's a bad idea because I don't know. I really don't. But all I'm saying is that I I was in a privileged position to if you don't wanna do any work to to figure out solutions to your own personal getting into mining, it's a very good solution. And you may you may luck out and you make more money than you spent on the miner over a certain ROI time, and then you're sitting on a bunch of Bitcoin, you're mining it for free. And then if if you get rug pulled or something, we've just seen so many rug pulls in this industry that you don't know what is viable and what isn't.
And the hosting thing seems to be kind of a newer type thing. I don't know. I haven't looked into it real closely. But So And like I said, I go ahead.
[02:19:50] Unknown:
Well, I'm just gonna say what what what were you what I got into this for, what you kinda left me just got into this for. I think you to a certain extent as well. We're looking for KYC free Bitcoin. Right? So, which is what we kind of we're talking about here. There's a very important distinction to make here because KYC the term KYC has has become, it's starting to be used now as just a catchall sort of phrase, for any sort of, you know, identity. You know, like, if you have to hand over any of your identity where you did k y that that's k y c. Alright? That's not actually technically the truth. Okay? But, one of the comments I see in here is saying doesn't hosting solution because of the the legality, doesn't that remove the KYC free rewards? So what's the point? Valid question. Right? Valid question.
However, there is a massive difference between doing actual KYC AML regulations and and this particular setup. The difference is when you do KYC, what you do when you go to this exchange, you fill out all this information, you give over all of your personal details to an actual Bitcoin exchange, a financial institution that has an obligation to have all this all of this stuff on file, so that it can be picked by whatever authorities wanna pick from it. Don't even need a warrant, so it's awesome. Whenever you're dealing with one of these hosting solutions, it's that's not the same thing that you're doing. You're not putting your information on a readily available, easily scraped database by whatever agency wants to scrape it, to gather all this information about you.
Now that's not to say that this hosting company doesn't have a legal obligation to hand over whatever information they give if pressed for it. I'm sure that they would. I'm I'm I'm sure that, you know, when push came to shove, your your identity the fact that you're, you have a minor hosted there, it that that's a very good possibility. But it's not the same thing as doing KYC. Right? You're not just
[02:21:59] Unknown:
immediately dumping into it. So You do you do, though. You you do like our boy, FTB, says, he says that there's there's a decently anonymous way to do it where you register with them, you pay them in Bitcoin, you use a burner email, all of the above, all the all the proper precautions to do so. But then you run into the other the other hurdle is if something does happen, now you have no assurances because how are you gonna prove anything to the to to them? If you haven't properly KYC'd, they can say that your machine like, one of their machines could go down. Like, one of the ones that they're hosting for themselves goes down or something happens to it or whatever, and that's not their machine anymore. That's your machine.
[02:22:56] Unknown:
Right. But but that's what I'm saying. The point that I'm getting at is is that's not actually KYC.
[02:23:04] Unknown:
No. But if he's lying about it, he has no claim. Like, you were saying that they had some insurance insurance assurances or something like that, but you can't collect on that if you lied about your identity.
[02:23:15] Unknown:
I'm not even talking about lying. I'm just saying KYC the term KYC is being used as a blanket term to just blanket, describe, you know, any sort of identity. So it's I I think it's important to distinct to to to make a distinction between what is actually doing KYC, which is handing over your selfie and your ID and all that stuff to an to a a a financial institution and exchange. That's one thing. That is KYC. This other thing is not we're calling it KYC. It's actually not. However, as you as you point out, when push comes to shove, your yes. Absolutely. Your identity, if you if you, give yourself some sort of legal protection from this company, they will hand over all of your information to authorities. It's not like they're not going to. The point I'm making is that's not sitting on a an actual KYC database like it is at an exchange.
It's not the same thing. So there's a level of separation between where your identity is sitting and these regulators or or agencies that may be interested in trying to deanonymize you. So there is a a level of, of protection, but that will immediately dissolve if they're pressed on it. The problem the the thing the thing is they have to be pressed first in this situation. I 100% agree with what you're saying. Yeah. Yeah. That's right.
[02:24:45] Unknown:
You just Oh, now either
[02:24:47] Unknown:
go ahead. I want I want one thing I I I will say, I don't wanna give too much away here because, you know, this is something that I I I am literally actively working on myself. But I I I hope to, alleviate this within the next few months. I am actively working on a solution that I believe, is tailor made for individuals looking for privacy that also want some sort of protection for their machines for a hosting facility. So I'm working on something. I hope hopefully, it it'll work out. I can't get too much of it but understand. I I see the problem. I understand the problem, and I'm I actually I am working on,
[02:25:30] Unknown:
bringing a solution to market. Yeah. I am too. I'm, 4 months into it right now. I'm not in competition with you. That's the sweet thing about miners. It's kinda the same thing about Bitcoin holders is you don't like, you're actively trying to get your friends and family and randoms on the Internet to buy Bitcoin in competition with you because you want more Bitcoin. And it's the same thing with mining, is you're actively trying to get basically, you're you're you're trying to orange pill your own competition. Like, you want more people to have miners because they're like minded people.
So
[02:26:14] Unknown:
Sure. And I and I don't want anybody to to to walk away from this thinking that I'm advocating for, hosting or certainly not for for KYC. I just think it's important that we understand that everybody is in a different situation. This is a very personalized thing. And there are trade offs that some of which are completely and wholly unacceptable, some of which may hurt a little bit, but you're willing to make them depending on your situation. So all I'm saying is cloud mining, scam. Don't do it. Hosted facilities, be very, very, very picky with who you use for a hosted facility if you choose to do it. Like, extremely picky.
Vet them as much as you can. Make sure that their reputation is strong. Make sure that you get the protection that you need.
[02:27:05] Unknown:
But at the end of the day, if you can, just mind at home. And I know I know I know plenty of people. And like I what I originally said is I understand what the hosting what the hosting offers to people. I understand the problem that it solves for people. And all the questions that, from the people that I know that do it, I've asked them questions because that's the only way I can get information about it. And, like, they gave you the serial number of the machine. They they do they they do put in place some level of security so that you know that you're not getting totally wrecked. But 3rd party is a third party. You can never you can never truly trust someone that you've never been with.
[02:27:59] Unknown:
Eco Eco, host our miners for us.
[02:28:02] Unknown:
You know, if I had more than 200 amps to my house, I might consider it. But We're buying next stop.
[02:28:10] Unknown:
Start leasing some subways out. There's a pizza joint that I've been looking at. They have electric pizza ovens. Place is a total disaster. 170,000. Just thinking about it, but the guy was a dick, so I told him I wasn't interested.
[02:28:26] Unknown:
You know, I I think you guys have, like, a a very level headed perspective on on hosted mining. You know, I I'm a self custody maximalist and a do it yourselfer. So, you know, I I I believe there there are no problems. There's only solutions. And you can find a solution to heat and air ventilation and noise, and electricity in your own home, and you can get basic and do it yourself. But, you know, I think everything you guys have said about hosting is valid. I think you've outlined the risks very well. And, you know, for those people out there that really wanna mine but just really can't do it at home, you know, I I think you guys have spelled out a good case where hosted mining can be a solution.
[02:29:21] Unknown:
I agree. I would rather I would rather buy a miner, me personally. Like, I'm in a privileged position where I don't have to do so, but I would rather I would prefer buying a minor with a company like Compass and having them host it for me for a fee, then I would blindly handing my coins over to a lending service where what they're actually doing with the with that coin is so opaque that you don't even you don't even know how your money is being used. Like, they don't know you don't know what why you're getting that yield. They don't even tell you. They don't even tell you what assets they hold or anything, and that's that's insane to me. At least at least you know the structure of a company like Compass.
[02:30:13] Unknown:
And one of the things I I wanna point out too, I don't know about Compass. Like I said, I I don't know anything about them. The only thing that I do know a little bit about is Blockware Solutions. Like I said, that's only because, of Crazy Kay, which I've talked with. Like I said, he's one of the Ronan guys. He's had a he had a a couple of ASICs with them for over a year. He never had a problem. So one of the things that they do though is they give you VPN access to your miner. Okay? So it's not like you just just, you know, throw this machine in there and then you just hope you get a payout in your wallet later. You have VPN access to the miner. So, in the case of Blockware Solutions anyway, and he's able to choose whatever pool he wants to mine on. So he you know, if he wants to mine on slash pool, it's no it's it works the same way. He has full VPS control, of where his hash is getting pointed. So you don't have to mine with their pool or anything like that in the case of of blockware. So, again, that's one more thing where it's a little it's not quite just blind trust. It's not like cloud mining where you just hope that they send you a payout after a certain amount of time. Like, you do have some sort of aspect of control over your hash. You just don't have the physical access to the device. So, again, massive trade off, but that's not to say it should be fully discounted.
[02:31:32] Unknown:
No. I agree. I agree. There is, no. And that's the same way compass mine compass mining works too is from the people that I talked to is you get to point your hash rate at whatever pool you want. They're just running it, and they're running it at a fee.
[02:31:49] Unknown:
But
[02:31:53] Unknown:
but the 3rd party hosting thing is always what I'm worried about is because if they can prove any type of, like so the whole new like, I was talking earlier, you can you can use miners as collateral against the loan. You don't know that they're not doing exactly that. They might be leveraging your miner because it's an asset on their balance sheet because they're in possession of it, and it's a liability on your side. So, I mean, they get margin called. All those miners might be you don't you just don't know the funky business that might happen. It's the same thing with GBTC or anything else. Nobody nothing nothing is out on the table. You don't know what anyone's doing with your assets.
And if they're your and I and and again, I'll go back to saying, I don't think that compass mining is a bad idea. It's I see the problems that they solve, and it is it is legitimate problems for most people. I just I'm in I'm in a position where I don't need to deal with that, so I haven't looked that much into it. So maybe my take is even bad on it. I'll I'll admit that. Well, I mean, I mean, look. Trusted third parties are security holes point blank period. That's been established. We know this.
[02:33:14] Unknown:
So it's just a matter of whether or not this particular third party, has done enough, to garner enough reputation to allow you to put a level of trust in them. And, you know, like I said, I hope to be bringing something in the market to actually deal with the identity portion of this in the future so that people are concerned about KYC, that that want some sort of protection but don't want to hang over their identity. It can be done. I just need a little bit more work on it, but it's it's I'm I'm gonna get it done. So look forward to that.
[02:33:51] Unknown:
Attaboy. That's exciting.
[02:33:57] Unknown:
I mean, I think I think that was a pretty great discussion on the trade offs. It's counterparty risk like anything else, and, you have to decide if your if whatever your current situation is, how how you wanna handle that risk and if that risk is worth it to you. But I would say, like other custodians in the Bitcoin space, just because they might not formally be KYC currently, you always run the risk that there's a shotgun KYC moment if they're holding whether that's your Bitcoin or your hardware. And and that that can happen quicker than people expect. I mean, we we saw we've seen it happen a 1000000 different times with, Bitcoin custodians. Absolutely. Binance being the most recent example.
Yep.
[02:34:51] Unknown:
Yeah. Go ahead. Can I can I hit this one little question here that you It's talking about how about, mining shitcoins on a general purpose computer that's already present in your home and then dumping them for Bitcoin? I mean, I'll probably get canceled for saying this, but sure. Why not? You know, the whole point of this game is to accumulate Bitcoin, if I'm not mistaken. So, if you have a a general purpose GPU or even a CPU that you're able to mine, you know, some shitcoin that you care nothing about and instantly dump for Bitcoin without having to do KYC in order to do so, then, I mean, what are we talking about? Fire it up. What I'll say though is, a lot of the times, that's not really that true. Like, a a regular normal CPU or GPU that you've got sitting in your normal laptop is probably not actually gonna do anything other than heat up your computer a whole lot and not really earn much.
So what you'll end up doing is spending a a few 100 or even a few $1,000 in building out a GPU or CPU to, you you know, to mine something when, I mean, you know, buy an AC. Spend that, buddy. Get an s 9 or an s 17 or an m 31 or m 20 and and, you know, just go directly to Bitcoin. But, that's, you know, that's something. And there's a miner that came out a few a little while back. It was called a coin mine. What's the name of it? Coin Mine 1. I, First of all, I don't don't get it. It's terrible. But their their their entire, their entire selling point was this is a miner that you can just plug in and leave on your countertop.
Alright? And you can have it sitting in your in your home just just on a coffee table. It looks just like, you know, like an Xbox or something, and you can just leave it sitting there and you'll be mining Bitcoin and you'll be contributing to the network. That's this is their whole spiel. Right? You contribute to the network, you'll mine Bitcoin. When in reality, you can literally never ROI with a coin mine ever. Like, no matter you cannot do it. And what they're doing is they're trying to, like you have to you can mine, like, Grin or just some other just the worst worst of the worst shit coins.
And then they'll try to transfer that to Bitcoin and and, you know, make you feel like you're mining Bitcoin at home, and you're doing so with the machine that, you know, you can talk about at a party. Like, it's a good conversation starter. No. It's it's horrible. You can never know why. But in my opinion, there's a massive market share here that's not being addressed yet that I believe ASIC manufacturers in the future may do where they actually target a home miner. And they proceed and they succeed
[02:37:49] Unknown:
Oh, sorry. I didn't mean you're That's alright. Go ahead. Oh, well well, we see some of our friends. Right? Like, Matt Odell is actually the only one left out of the chat that that we shared together, and we see some of our buddies doing exactly that. They they're they're mining shit coins and insta converting them. It's, essentially, it's a speculative attack against the shitcoin. It drives the price of Bitcoin up because they're mining shitcoins, and then they're selling the shit coin to drive the price down on the on the coin that they're mining and drive the price of Bitcoin up.
But everyone has a hard time against them because they are, quote, supporting the network.
[02:38:43] Unknown:
Yeah. Well, if I could just jump in here real quick. I mean, first of all, I'll I'll reiterate what Diverter said. I mean, CoinMine is extremely overpriced, and they put it in a, like, a super classy package or whatever, and they they get sponsorship deals on big podcasts to sell it. But it it was extremely overpriced. I do agree that there's a place for a home miner. As far as mining shitcoins and dumping them for Bitcoin, auto dumping them for Bitcoin, I don't think I mean, diverted you said in the beginning, I might get canceled for this. I mean, I think that aligns pretty strongly with Bitcoin in that you're providing auto sell pressure on the shit coin, and you're providing auto buy pressure on the Bitcoin.
And one of the nice things about it is you if you do have a gaming computer at home, you can just use that already. You already have that. It's general purpose hardware. To go out and buy a purpose built overpriced machine to do that is a whole another story that doesn't make sense. Can you hear me again? Yes. Sorry.
[02:39:48] Unknown:
Yeah. No. To to back to my point is these guys that we know that are doing this are buying Alienware machines that are essentially purpose built to do exactly this. They're they're super fast. Everything about them is great for doing this. And they're still essentially money at a loss, but they're being subsidized because the machine themselves is under a 1 year warranty. You can cook the machine. You can just cook it. You can crank it up as high as you want, destroy the machine, and then you get it replaced at the end. And then when the new one shows up in a box, you say, alright. This game is over. I'm just gonna resell it brand new in the box. So there's a whole different dichotomy of what else is going on. Like, they might be speculatively attacking that particular chain that they're on and making Bitcoin out of it, But when all is said and done, the hardware cost has done nothing.
I hope I didn't give away too much, but don't do that. It's dumb. You're gonna get caught with your pants down.
[02:41:08] Unknown:
Yeah. I mean, the the whole the whole idea here is that, we want people to be able to, you know, directly mine Bitcoin and to be able to earn, in a way that they don't have to give over too much of their identity and with that with too much third party counterparty risk. That's the whole goal. Now there are a mere there are myriad ways that that can be done. But at the end of the day, if you have the ability to buy a a Bitcoin asset, set it up in your home and mine, that can be done. Absolutely feasible. You're you're not, necessarily, quote, unquote, competing against the big players. You're just dollar cost averaging in through your electricity bill as Econo Alchemist, alluded to. However you wanna accomplish that goal, do that. But understand that this is this is absolutely a feasible thing that can be done today.
[02:42:09] Unknown:
Yeah. All the narratives against home mining have been shattered in my opinion.
[02:42:17] Unknown:
Oh, absolutely. I mean, you look right now at the the profitability for miners at right now, the the one of the tools I like, there's a couple of them. I like, what to mine dot com or, cryptomining.tools. Those are mining calculators that you can look at. You can, put in your, residential electricity rate, choose the different miner that you want to actually, look at, and you can get an idea of what your profitability will be. And if you look right now, like, if you're at a residential rate, the average in the for the United States is 13¢ per kilowatt hour. At 13¢ per kilowatt hour, you're literally earning mining Bitcoin probably at around a 60 to 70% discount from what you would buy on a spot market.
[02:43:07] Unknown:
Yeah. A lot of those calculators are broken after the whole China thing. So the one that I found to be most accurate is insights dot brains. That's braiins. And you guy have in Antminer right now is breakeven price, 13¢ a kilowatt hour. Daily profit, $2.86. You jump to new generation. Even even not the newest generation, the What's Minor M30 s is 30¢ a kilowatt hours breakeven. Daily profit, $21.25. And once they put brains on that, like, you're talking you got 4 minors. You're making more money than you're making at your at your Fiat job.
[02:44:06] Unknown:
Yeah. Like, right now, I mean, I run, the s 17 pro, 5th 50 Terahash model. And for me, basically, per miner, I'm essentially, DCA ing a $100 a week in in Bitcoin. Daily profit on an s 17,
[02:44:24] Unknown:
not a pro, but just a regular s 17,
[02:44:29] Unknown:
$16 a day. Yeah. I'm, for mine, I'm basically getting getting around $100 a week. We're just just round numbers. Call it a $100 a week, and I'm paying around 30 ish.
[02:44:41] Unknown:
Yeah. On the n 30 twos on the n 30 twos, we're making at 8¢ a kilowatt hour. We're making $400 a day.
[02:44:51] Unknown:
Right. So it's not only at this point right now, it's not only, you know, just about breakeven. I mean, if you're if you have even a a decent electricity rate, you can be rather profitable, and that helps a lot to get your, return on initial investment as long as these machines have a little bit of longevity to them. It's important, you know, when when you deploy, there's a lot of things that go into it. But, you know, the entire narrative as Econo, alluded to, the entire narrative for so long that was, you know, just buy and hold. Don't even worry about money. I am I am so excited to see that, be falling away and and more day by day, I see more people on Twitter.
There's a guy, Bob dot Hogle. He just, you know, released his his guide. And it's like every guy that comes out, I feel like that's another baton being passed to the next to the next round to the next round of people, you know, putting out these machines and becoming garage band miners. So I'm I'm absolutely I'm so happy to see this this change.
[02:45:56] Unknown:
Yeah. I love it too. But we I think we need to move away from this, ROI, this idea of ROI, like, return on initial investment. Because people look at it and they're like, okay. So it's 14 months before my machines are paid off. And I understand that that's that's conventional, but at the same time, you gotta remember, okay. So now the machines are paid off, and it took you this many months to pay them off. But at the same time, those machines are not a nonzero value. Those machines are still worth an incredible amount of money. Like, you can't discount the fact that you have physical capital still.
[02:46:46] Unknown:
No. Not at all. I'm not it's it's not that. But but there is, an a real cost, that you have to deposit into this, especially if you're paying for a miner in Bitcoin. Then, you know, your your return on investment is are you pricing that in US deal? Are you pricing that in Bitcoin? So, you know, you're gonna there's there's things that you need to look at, but, with the especially the state of the network as it is right now, I'm of the opinion that there's there's never been a time better than, potentially right now, the next I have a dip. 6 months. Yeah. The next 3 to 6 months are crucial as all these miners are coming out of China, all this like, this is the iron is hot right now.
[02:47:33] Unknown:
Yeah. And to to Neil's point about ROI, you know, I I think the asset appreciation actually bolsters the ROI argument. That's one of the first things I hear people bring up when they're considering mining is, like, well, you know, how long is it gonna take me to earn my money back? Would I be better off just buying Bitcoin with it and holding it instead? And, you know, that's why a week ago, I I put that little mini thread together with some data I had collected about the previous 12 months to help people decide what would be a good idea for them to to get into mining. Like like, what the profitability of it for them will be.
And, you know, right now, even if if the price stayed static and the network hash rate doubled, you'd still be mining profitably at the average US electricity rate. And in in in the in an in a flip scenario where the price crashes, but the hash rate state is static, you're still running profitably at the average electricity rate. So like you're saying, I I think right now, the you have nothing but upside potential to gain from this. Because even even if the price goes down and the network hash rate goes up from this point, most people in the United States are still gonna be profitable mining at home.
[02:49:04] Unknown:
Yeah. And it's important when you're looking at these things that, when you're calculating potential return on investments or whatever you're looking at, do worst case scenarios. Don't don't calculate your your absolute rosy rosy eyed glasses, you know, because profits come and go. Alright? And if, you know, things can happen and things can change to where this, amazing profitability we see right now today could go back to like it was just a year ago. And, you know, you you were potentially I was mining at a loss on these same exact machines that I'm now mining at basically 70% under market value. So calculate your risk as if things were going to be really bad and be, you know, be pleasantly surprised, not that it's aware of. Thing the last thing you wanna do
[02:49:54] Unknown:
is is not mining at a loss. The last thing you wanna do is be selling at a loss. Do not put yourself in a position where you have to sell coins at a loss. That's just always keep a reserve. Just know that it's gonna go bad. It always does. You'll end up in a position where you can't afford your bills or whatever. Money at a loss is fine as long as you can cover your bills, but do not sell at a loss. That has wrecked more people than anything else is overextending yourself. Do not overextend.
[02:50:42] Unknown:
Yeah. So, I mean, guys, this has been a great conversation. We're nearing the 3 hour point. I think it's probably a good time to wrap up. I appreciate all your time. I guess we'll do final thoughts. We'll start with Iko. Iko, final thoughts.
[02:50:59] Unknown:
Anyone can mine at home. It solves the issue of privacy. It it solves the issue of censorship resistance. It show it solves the issue of KYC. It it's very profitable right now. There's a lot of margin to, go to the downside and still have this make sense. It's worth the effort. The hardest part is gonna be the infrastructure. But once you get over that hurdle, it's smooth sailing from there. Plug it in. Let it run. The thing is on autopilot. There's just so many benefits to money at home, and I'm just thrilled that there's been a lot of interest from the community in pursuing it.
[02:51:42] Unknown:
Awesome. Thank you, Iko. Neil, final thoughts.
[02:51:47] Unknown:
Not much. I just wanna I just wanna give a shout out to my brother again, Eric. He dude, it's so it's was such a blessing to orange pill the guy. One day, I'm sitting at the bar with him, and I go, you wanna get into Bitcoin mining? He's like, yep. Done. So easy. And to have somebody to kick problems around with all the time, every day, every day, if I need him, he's there to to answer anything and work with me. It's just been such a blessing. And to answer some of the, chat that I've been looking at, 12. I drank 12.
[02:52:29] Unknown:
Thanks, Neil. Diverter, final thoughts.
[02:52:36] Unknown:
Yeah. So, as the chat says, don't be a DJ. This this whole mining for the streets thing, this whole individual garage band mining thing, I I feel like, it's we're seeing a resurgence of it now, which I absolutely love. We're gonna need it to continue to grow. Understand that when you are, asking to operate in a market that is outside of regulations, which is what we're doing, We're we're asking to be left alone. We don't want KYC. We don't want all this stuff. So when you're when that's the case and you're you're asking, you know, you're you're making the initiative that I don't want I don't need regulations, then what that means is we have to regulate ourselves.
So it's on you to do the research. It's on you to find the reputable dealers. It's on you to, learn about your infrastructure, your electricity costs, your profitability. All this is on you and your personal responsibility. Anybody that tells you that it can't be done, has just simply not done the research themselves. DUIOR, do your own research. Don't skimp on, reputation to save a few bucks, and fire those miners up.
[02:53:59] Unknown:
Thank you, guys. I hope to have you all on dispatch again soon. I think this was a very good conversation. I think,
[02:54:07] Unknown:
one last point one last point, Matt. Hit us. Everyone can ask us anything they want whenever they want. Do not make a purchase without verifying it.
[02:54:21] Unknown:
100%. I mean, we appreciate your time. I think so I'm gonna put, I'm gonna put links to all their Twitters in, they're tagged on Twitter, on the actual tweet of the show, but I'm also gonna put them in the show notes as I usually do. I'm also gonna put links to the guides in the show notes. You can also find both, Eco's blog and Diverter's blog on sidleldispatch.com/help. I just wanted to thank the freaks who joined us in the live chat. Once again, I wanna thank the freaks who support the show. Reminder, you can go to new podcast apps.com to download a podcasting 2 point o app, where you can stream stats directly to the show. All you have to do is search CITIL dispatch there, load it up with stats. You can stream stats that way. You can also support the show by going to sidlodispatch.com, and there's a there's a tip and dot me, so you can donate via lightning, or you can donate via PayNim.
So I implore all of you to do that if you're interested in, oh, well, I implore you all to support the show. I appreciate that. But I implore you all to check out their Twitters, follow them on Twitter, read those guides. Once again, still dispatch.com/help has links to the blogs. And I'm just feeling really grateful here. I love my BitHorners. I love you guys. Thank you for being on the show.
[02:55:42] Unknown:
Thanks, Matt.
[02:55:43] Unknown:
Thanks, man. Ben Black. Yeah. Thanks, man. We're definitely gonna make it happen again soon. Appreciate you guys. Absolutely.
[02:56:01] Unknown:
The sun is hot, and that old Clark is moving slow, and so am I. Workday passes like molasses in wintertime, but Oh, miss something tall and strong. Make it a hurricane before I go and sing. It's only half past 12, but I don't care. It's 5 o'clock somewhere. This lunch break is gonna take all afternoon and after night. Tomorrow morning, I know they'll be held to pay. Hey, but that's all right. I ain't even had a day off now. In over a year, I've been making vacations. Gonna start right here. Get the phone's from me. You can tell them I just sailed away. And, boy, miss something tall and strong. Make it a It's 5 o'clock somewhere.
I could pay off my tab for myself in a cab and be back to work before 2. At a moment like this, I can't help but wonder what would Jimmy Buffett do. Funny you should ask,
[02:58:55] Unknown:
It doesn't matter. 5 o'clock somewhere. It's always on 5 in Margaritaville, come to think of it. I heard it. You've been there, haven't you? Yes, sir. I've seen your boat there. I've been
[02:59:42] Unknown:
Love your freaks. If you prefer to support the show via merch, we got some quality merch [email protected]/stack. Check that out. I love you all. I'll see you for rabbit hole recap on Thursday, and I'll see you for another Bitcoin Tuesday on Tuesday. Stay humble, stack stats.
[03:00:00] Unknown:
Later, bro.
Market update: Dow futures, S&P futures, Nasdaq, and treasury market
Crypto market update: Bitcoin, Ether, Litecoin, Ripple, Dogecoin
Stock market update: Energy stocks, airline stocks, grocery stores
Introduction to Bitcoin mining
Reasons to get into Bitcoin mining: KYC-free sats, income, privacy
The impact of Diverter's mining guide on the narrative around mining
The long-term game of mining and the importance of not selling
The role of small-scale mining in decentralizing the network
The ideological reasons for mining and the alignment of incentives
The importance of starting small and spreading out mining operations
The future of mining and the race to longevity
Importance of a stable environment for mining
Longevity of mining equipment
Increasing ASIC life cycles
Heat utilization in home mining
Heat utilization in commercial mining
Acquiring miners
Buying from Kaboom Racks
Buying from hardware market verified listings
Setting up the miner
Managing heat and noise
Pros and cons of hosted mining
Comparison between buying a miner and using a lending service
Discussion about Compass and Blockware Solutions
The importance of trust in third-party hosting services
Mining shitcoins on a general purpose computer
The benefits of mining at home and the need for self-regulation
