Three (3) Ways Miners are Avoiding Barriers to Entry
Cryptocurrency mining is an increasingly popular commercial activity. The specialized equipment required to solve the complex mathematical problems involved in mining is pricey, however, and out of reach for many cryptocurrency enthusiasts. Not everyone can afford to purchase this equipment, rent the space to house it, and pay the large electric bills associated with mining it. As a result, people have gotten creative in order to circumvent the barriers to entry. Some of these methods are more ingenious, lucrative, and legal than others.
Physical Relocation
A second trend that’s getting noticed is miners who relocate their rigs to places with lower utility rates. Cryptocurrency miners have taken advantage of the low-cost hydroelectric power in Upstate New York. Not all New Yorkers are excited about their initiative, though. As a business incentive, the City of Plattburgh, New York allowed a 2-cents-per-kilowatt-hour rate for electricity to industrial enterprises. This rate is even lower than the already very low 4.5-cents-per-kilowatt-hour rate residents pay, and a number of cryptocurrency mining outfits relocated their mining rigs to empty warehouses and factories there. As anyone familiar with cryptocurrency mining knows, though, mining rigs take an enormous amount of electricity to run. That energy consumption uses most of the low-cost power set aside for residents and other businesses of Plattsburgh to use, and their rates have risen. The Mold Rite plastic cap plant’s January electric bill was $26,000 dollars higher this year, in fact. Many people have complained, and the City of Plattsburgh recently banned cryptocurrency in the city until fall of 2019 in response. Mayor Colin read has stated that he hopes to charge mining outfits higher rates. Crypto miners in Plattsburgh and other towns are working to come up with a plan that will better accommodate all parties.
Upcycled Mining Rigs
Ken Shirriff is making his own mining rigs from old computers and retro gaming hardware. Last year he made a mining rig by converting a 1973 Xerox Alto and utilizing the obsolete BCPL language to code the hash algorithm. He’s repurposed a 1959 IBM 1401 mainframe and a 1985 Nintendo gaming console into mining rigs as well. Of course, none of these can compete with ASIC rigs. They can only perform 1.5 hashes per second as opposed to trillions of hashes per second, but this is a great hobby for Shirriff. If he can use completely outdated technology to mine, what can others make from more recently defunct tech?
Cryptojacking
Finally, there is the cryptojacking phenomenon which has grown incredibly fast to become the second most common form of cybercrime now. Cryptojacking is the unauthorized use of a computer to mine cryptocurrency. Hackers who wish to mine cryptocurrency but do not want to purchase rigs or pay for electricity hijack other people’s computers via malware. The targeted user either clicks a link or onto an infected site. This executes the malware and loads code onto the computer where it begins the process of mining automatically. When the computer has completed a required mathematical problem, it sends the answers to the hacker’s server and voilà. Free mining. Cryptojacking is easy and cheap to get into and, while jacked computers don’t mine with the same results as dedicated rigs, they mine continuously. With enough jacked computers, the hacker can make a tidy income. The risks associated are also very low, making this a very attractive way to literally make some coin.
The above three methods are only the tip of the iceberg of what we are likely to see in terms of corner cutting if cryptocurrencies continue to increase in value.
