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The cryptocurrency market is heating up so much that you can now warm your house while mining for coins, thanks to a French startup called Qarnot.
The company has produced the QC1, which may be the first dedicated computer/heater designed for the domestic market, which means the Internet of Things is not only crunching data, but also heating your living room.
Qarnot describes the device as “the first heater actually generating crypto money”. So what’s behind this simple, but clever, idea?
The hot air problem
As anyone who owns a smartphone, tablet, laptop, or desktop machine knows, computers generate a lot of heat. The harder and faster they work, the more heat they give off, which is why data centres need lots of expensive cooling.
Cryptocurrency mining rigs – often assembled from high-end GPUs manufactured by companies like NVIDIA and AMD – give off a lot of heat too. This is why anecdotes have been circulating about students huddled for warmth around repurposed gaming hardware in their rooms, mining for Litecoin or Monero. (A vision that recalls miners of a different kind huddled around their braziers during the 1984 pits strike in the UK.)
Qarnot has designed a device that is intended to be both a heater and a computer, optimised for mining the cryptocurrency Ether. The QC1 is a stylish radiator that would complement any loft apartment, but instead of a traditional heating element, it contains two AMD GPUs – but no fans or moving parts.
Simply plug in the heater, add your Ethereum wallet to the mobile app, and as the heater warms your room you’ll gradually receive Ethers, says Qarnot. The QC1 is a Linux server, and so can be instructed to mine for Monero, Litecoin, or any other currency.
Banking on heat
According to TechCrunch, Qarnot has form in both the edge computing and heating spaces, which is where the idea gets smarter. The company has previously sold computer-heaters to construction companies. As sales grew, it effectively created an expanding, distributed data centre, which it rented out to the French financial sector, among other clients.
This meant that banking transactions were literally warming up building sites: proof that banks do sometimes give something back to the workers after all.
And because Qarnot still runs those businesses, it means it can farm out crypto processing to its decentralised data centres in the hot summer months, so QC1 owners aren’t melting in their homes.
On the face of it, therefore, the QC1 solves several problems: it mines for currency – taking the task away from other computers – it heats your home, and money just turns up in your virtual wallet.
But is it really that simple?
Internet of Business says
Make no mistake, this is a brilliant idea in many ways. Why waste all the heat that computers generate when it can be turned to good use? And why fill up your house with ugly mining rigs when you can leave a stylish device running in the corner of the room?
As the IoT spreads, both cryptocurrencies and edge computing devices may be critically important, especially when more and more services – from supply chains to banking services – are run on blockchain technology.
But as our in-depth, 2,800-word analysis of the challenges facing cryptocurrencies explains – along with our separate report on hardware giant NVIDIA – there is always a cost in the physical world. One is in heat emissions, processing time, and energy consumption, which Qarnot has been clever enough to turn to its advantage.
After all, this is the same reason that hackers are creating crypto-mining botnets: to offload the cost onto other people.
But another cost is more troublesome: money – the old-fashioned kind. As more and more people want to mine cryptocurrency and invest in the hardware to do it, the real-world cost of buying GPUs is going through the roof – along with all that heat – depriving other markets of critical stock.
Lots of complex, high-end processing tasks demand GPUs; entire industries and data centres run on them.
It’s the real reason that NVIDIA’s share price has tracked the growth curve of bitcoin market capitalisation over the past four years, as our earlier story revealed.
At present, the retail cost of one QC1 appliance is $ 3,600, which is a lot of real money for a heater, and a lot for a computer too – but of course, the company will accept payment in bitcoins. At the current real-world value of Ether, the company says that owners can expect to mine the equivalent of $ 120 a month using the device.
The maths reveal the awkward problem lurking beneath the cryptocurrency market: that’s not $ 120 of profit a month; it’s 30 months of heat before the device even pays for itself – not including any other costs it may incur. Or the cost to the environment of manufacturing and shipping the heater in the first place.
Internet of Business put this point to an accountant, who said: “Rounded up, my own electricity is 15p (21c) per kW and so the cost of the actual electricity would be £54 ($ 75) for a 30-day month. If we depreciate the ‘heater’ over three years, that’s £99 ($ 137) per month, plus £54.
“So with Ether at current rates, we’d be losing about £33 ($ 45) per month by my calculations. No wonder this is all being done through hacking or stolen electricity!”
But of course, the Ether market could go through the roof – hopefully even higher than the price of high-end GPUs.
But because of all this, Qarnot may have provided yet another useful service: by revealing some of the critical workings necessary to determine a fair value for any cryptocurrency.
As ever, the core questions are: what’s the cost per watt of mining? And what is any cryptocurrency backed by, other than depreciating computer hardware that needs to be manufactured where labour is cheap and shipped across the globe by fuel-guzzling freighters and aeroplanes?
In a blockchain powered world, the long-term answer may be almost utopian in its simplicity: cryptocurrencies may be backed by our data gold, and our consent.
But the fact that this is such a fuzzy, utopian answer suggests that the reality will be messier and more complex than that. Until then, maybe a better answer will turn up in your Ethereum wallet.
But at least you won’t have to put 50p in the meter to keep the heating on; it’ll cost you a lot more than that.
With thanks to Derek GC White.
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