Josh Ong is the US Editor at The Next Web. He previously worked as TNW's China Editor and LA Reporter. Follow him on Twitter or email him a Josh Ong is the US Editor at The Next Web. He previously worked as TNW's China Editor and LA Reporter. Follow him on Twitter or email him at [email protected].
Cloud backup service IDrive looked into mining bitcoins during off-peak hours as an alternative revenue stream, but it dropped the plan after estimating that it would produce only a handful of bitcoins per year.
IDrive’s 3,000 servers are active at night when users are backing up their files, but they have a large chunk of inactivity between 3am and 4pm daily. The company’s engineers ran a simulation to see how much revenue it could generate by mining.
To arrive at an estimate, IDrive calculated results for 600 of its quad-core 2.8GHz servers, assuming that mining difficulty would increase linearly over the next year. IDrive pays a flat rate for its electricity use, so mining during off-hours wouldn’t add to its energy bill. According to the team’s research, the additional processing required for mining would still fall under its energy cap.
It’s worth noting that the simulation didn’t take into account increased wear on and the potential shortened lifespan of the servers.
IDrive estimated that after a year of mining 12-hours a day on 600 servers, it would produce 0.4315 bitcoins, or $271 based on today’s exchange rate. Across all of its servers, that would amount to about $1,300 for the year.
Here’s a chart from Coinplorer showing a 24-hour version of the simulation:
Ultimately, IDrive decided that trying to mine bitcoins proved an “unnecessary security risk” for just a small amount of revenue. It would have to install bitcoin software on each of its servers and re-open areas of its network that have been closed off.
I was surprised to learn that a cloud services company’s entire server capacity would only mine a few bitcoins over the course of a year, but much of that comes from using off-the-shelf hardware that’s not optimized for mining. IDrive might have better luck rerunning the projection for a younger virtual currency like dogecoin.
If you’re interested in learning more about the simulation, IDrive plans has posted its findings on its company blog.
See also: Bitcoin: It’s the platform, not the currency, stupid!
Image credit: Jonathan Nackstrand / AFP / Getty Images
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