The Relationship Between Datacenters and Crypto Mining

Crypto Mining

Mining cryptocurrencies has become a major industry over the last decade. Sophisticated and expensive mining operations around the world work day and night scouring the web for bits and pieces of blockchain from verified transactions. These additional pieces of block help fortify the currency’s network which compensates the miners for their efforts by giving them coins. 

The catch is that mining for bitcoin is both energy and bandwidth-intensive. In order to do it at scale, miners often look to datacenters. 

Data and Mining 

A mining rig needs to be able to constantly perform complex mathematical operations around the clock, which is taxing on hardware, not to mention energy consumption. This is why many mining operations either have to conscript a multitude of machines into their operations, or outsource them to a place like TRG Datacenters that offers dedicated storage and colocation services, as well as important hardware maintenance and cooling capabilities. 

ASICs and GPUs

An ASIC is an application-specific integrated circuit and its purpose is to mine Bitcoin over a decentralized network. They are the gold standard for mining Bitcoin because they not only use a more sophisticated algorithm (the SHA-256), but also because they are vastly more powerful and efficient than previous mining rigs. It is possible to attempt mining using GPU, CPU, USB or FPGA, but they lack the power necessary to make the endeavour worthwhile. 

The issue with ASICs is that because they are considerably more powerful, they make a lot of noise, generate a lot of heat, and have greater energy requirements. Many people, therefore, choose to store their ASICs in a data colocation center. As mining becomes more viable and profitable, the number of datacenters offering colocation services for precisely these purposes grows as well. 

The Growth of Mining Farms

Mining farms are physical locations around the world that house computers and other hardware dedicated to mining cryptocurrencies. The biggest mining farms in the world are located in Russia, China, Iceland, Switzerland and the United States. 

Farms are essentially private datacenters and their locations are chosen based on the cost of real estate and energy prices. Dave Carlson’s “Giga Watt” operation, which is one of if not the largest operation in the U.S., for instance, is located in Washington State because it has the cheapest energy prices in the country. Energy requirements are one of, if not the largest variable operating cost involved in crypto mining. 

Mining and Cooling Requirements 

Because of the required hardware–which needs to be capable of solving highly complex computational algorithms at high speed–cryptocurrency mining generates a lot of heat, which means a lot of cooling is needed. It has been suggested, for instance, that the immense heat generated by mining farms could be converted into energy used for greenhouses and improving food security. Datacenters that offer their services to or have a lot of mining clients have had to invest in the kinds of cooling infrastructure necessary to keep the hardware safe and operational. 

The most popular and effective type of cooling system for mining is known as immersion cooling, a liquid cooling method for high-density hardware like the kind found in ASICs. The hardware racks are submerged in large tanks in one of several proprietary non-conductive liquids–3M’s “Fourinert” or “Novec”–and as the liquid heats up, it is converted into a gas, which facilitates the cooling. 


Bitcoin and other cryptocurrency mining will continue to grow in popularity as the coins attract further institutional interest, receive high-profile endorsements from business and government leaders, and long-term value and stability become more sustainable. This represents a major business opportunity for datacenters with the space and capital to spare, which will be able to offer new mining operations the physical storage, energy and cooling capabilities they need in order to make their mining ventures profitable. 

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