Cryptocurrencies were originally intended to pay for goods and services, and in this way they are no different from traditional money. The main difference, in addition to the complete anonymity of settlements, is the method of obtaining (issuing) new monetary units and the structure of the network for their storage and payments. Cryptocurrencies do not have a single bank or emission center, and all monetary units are stored on the crypto wallets of network users. In this they are fundamentally different from other payment systems. Crypto wallets are combined into a single network "bank", and payments are made directly between users without any intermediaries, while maintaining maximum confidentiality. In addition to a new way of storing funds, cryptocurrencies also offer a new way of issuing monetary units through mining. And now, regarding the latter, we are again talking with expert Alexei Simakov.
HP: We will ask you the most important question at the end of the interview.
And now… so, we decided to start mining. What is it and how to make money on it? ALEXEY: Mining is the provision of your equipment (computing power) to maintain the blockchain system, with subsequent receipt of a reward for this when creating new blocks.
To put it simply, you can compare mining with the existing banking system.
For example, you want to transfer money to a friend from a bank card of one bank to another bank. You will pay a commission for this, because the bank services this operation. So miners carry out such operations on their equipment and receive their reward for this. Moreover, this reward is generated by the system itself and distributed to all miners in proportion to the power spent. And the blockchain is this whole system, so to speak, SWIFT or banking processing, only a different technology is used, encryption.
GP: I would like to dwell separately on the equipment and whether it is generally possible for an ordinary person to do this with ordinary computers.
ALEXEY: Yes, of course.
You can connect to the system from a regular and even outdated computer. But, unfortunately, the operation of a regular computer will be so invisible to the system that the reward will not even cover the costs of operating this computer (Internet, electricity, maintenance), although once there was enough processor power for mining. At the moment, there are several types of equipment.
We specialize in the main ones and recommend them for use, as the maximum balance is maintained in the purchase cost of the equipment itself, its resource, consumed electricity, and, consequently, payback. Let's talk about "ices" and "farms" on video cards. "Farms" on video cards (they are called Rigs) can be compared with a regular computer that everyone is used to seeing at home, only they use a larger number of video cards (usually from 6 pieces).
Just due to the computing power of these video cards, with their proper configuration, mining takes place on such devices. This is one of the most common types of mining equipment, since video cards can be freely purchased at any electronics store. Aisiki is the latest generation equipment.
They are special devices that use special chips, configured and created only for mining, and according to a certain algorithm. That is, the choice of such devices should be carried out as deliberately as possible. For example, in September, equipment from a well-known manufacturer came out, which at the time of release brought $ 100 per day (in terms of fiat).
A kind of hunt was declared for these devices, and the price for these ices reached 10 times the selling price of the factory. So, after the analysis, we refused to buy this equipment at all, and were not mistaken ... Since today its profitability has dropped to $ 10 and continues to fall.
GP: There is a very interesting term already known to many - “farms”.
What is needed in order to open such a farm, how legal is it in our country, and what are the nuances? ALEXEY: You can build a "farm" even in an apartment, but we do not recommend doing this.
Since you will quickly get tired of the noise and heat that the equipment emits ... And even if you are a very stress-resistant person and do not pay attention to it, your wife / husband will kick you out of the house, who will not understand why this is at all or the neighbors will start complaining ... There are also restrictions in terms of power, because the equipment consumes a large amount of electricity and this puts a load on the network. In addition, I would like to say that due to the operation of equipment cooling fans, the dust in the air is cut into very small particles that enter directly into the lungs, which is very bad for health. To work and build a normal “farm”, you need to decide on the currency that you intend to mine, and after that, purchase and configure equipment.
We recommend using for "farms" only non-residential premises with stable Internet access. If large power consumption is planned, or there are suspicions of poor-quality wiring, be sure to install new, high-quality wires with a margin of at least 25%. Also, for the stable operation of the equipment, it is necessary to properly adjust the ventilation of the room. In advance, you need to prepare a place for placing equipment. These are the main points necessary for the normal operation of the farm. It will not be superfluous to mention the security, monitoring and maintenance of equipment. After starting the equipment, you'd better choose a pool.
A pool is an association of many miners and "farms", in order to obtain the greatest reward from work. Without such a pool, it is very difficult to get any good income. This must be accepted, or a very large “farm” must be set up and then work independently. In general, at first glance it may seem that there is nothing complicated in building and running a farm, but a lot of nuances and pitfalls pop up in the process.
Regarding the legality of this activity.
At the moment, the activity is not regulated and is in no way prohibited. From July 2018, on behalf of Vladimir Vladimirovich Putin, this activity should become regulated. For our part, we do not see real and effective methods for regulation, except on a voluntary basis. Those. an individual or organization receives a patent for this activity, most likely based on the declared computing power, and will be able to transfer cryptocurrencies on the state exchange (yes, we believe that it should appear) into fiat currencies. Fortunately, only prohibitive methods, or without giving any preferences for miners, will not achieve anything good. After all, no one will interfere with spending and withdrawing cryptocurrencies through other countries, and this will simply be lost income for our country.
GP: As far as we know, there is even a factory that produces equipment for “farms” and the cultivation of cryptocurrencies.
To be honest, it all sounds with the theme of some garden for growing greens. Please comment on whether the direction of creating equipment for cryptocurrencies will develop and how profitable and promising it is? ALEXEY: Cultivation of crypto-currencies really sounds strange… for the first time I hear such an expression and I can’t say that it sounds correct.
As for factories: yes, there are already several such manufacturers and in the future their number will grow. For our part, we also studied the possibility of developing such equipment in the Russian Federation, so that it would be possible to compete with global manufacturers and raise the country's ratings, but due to large financial investments, we abandoned this idea until “better times”. But I can say with confidence that the profitability and prospects of this area are high, because the global demand for equipment is not covered by existing manufacturers. For all equipment, the queue and each batch are sold out in a matter of minutes, especially if this equipment is for a new algorithm. For example, the selling price of a plant for one device is 80 rubles (by prior order with full payment for 1-2 months), the cost of equipment does not exceed 40 rubles. At the same time, from the availability (from hands), this equipment is already being sold at 140-160 rubles. The figures are arbitrary, but the proportions are real. GP: Cloud storage systems are already familiar to everyone, understandable and convenient, but the concept of cloud mining pools sounds scary and absolutely incomprehensible.
ALEXEY: Actually, there is nothing frightening here.
Exactly the same technology as in data storage. Someone bought a server and leases it to you to host a website, exactly the same thing happens with cloud mining - you rent power and work on it. Or you provide your power to other people to work and mine cryptocurrencies... But you need to be very careful in this direction, as this is a very wide field for fraud. During the operation of our StopRisk24 anti-fraud system, we often encountered attempts to write off funds to such cloud pools, which actually never had equipment, and they simply wanted to steal money from gullible citizens under such a pretext. But as such, this is an interesting solution and suitable for those who are not ready to pay a round sum for the purchase of equipment, its placement and maintenance.
We will launch a similar solution in the near future, but through ICO and more transparent and understandable for the user. The idea is that anyone who wants to be involved in mining can buy our tokens (so to speak, shares) and receive income from the operation of the equipment. Thus, there will be no restrictions on amounts, and the token will be bought once, which will allow it to be held for any amount of time and receive income ... But this is a topic for a separate conversation, if there is interest in it.
GP: Last month there were global changes from the government of the Russian Federation regarding cryptocurrencies.
And even our material from the previous issue is no longer entirely relevant, although we predicted exactly this. The use of cryptocurrencies has been banned, and thus this business can now be considered illegal in our country. Is this judgment correct? Now I would like from you, as an expert, to get an answer to the most important and urgent at the present time - is it worth it then to talk about mining and cryptocurrencies, and even more so to invest your finances in this area? ALESIOY: We are following all the news and changes in legislation very carefully, but I have not seen a clear ban on the use of cryptocurrencies anywhere.
So the argument is rather wrong. Plus, the ban on the use of cryptocurrencies does not affect mining in any way. You can mine, but spend earned cryptocurrencies in countries where they are legal. Let me voice some information, and everyone will make a conclusion about the expediency of investments for himself.
The “farms” that we did on a turnkey basis in June have already paid off and have been working only as a plus for a long time. Based on the current market situation, the payback period for properly selected equipment is about 6 months. I don't know a business that can boast such profitability and payback. The bitcoin rate shows a constant growth and as this trend continues, the payback period decreases. But the main thing is that an interested investor understands that such profitability cannot be without risks. Without risks, it is better to go to a Swiss bank ...
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