Crypto Mining as a Service CMaaS Build Recipe: Colo Rental Resources, Price Discovery and HeatMaps
Mining Pools as a Service: More to it than Meets the Eye. It's the Softtware Silly...Not the Iron

Crypto Mining as a Service CMaaS Build Recipe: Colo Rental Resources, Price Discovery and HeatMaps


Need some computing cycles fast? More Storage Anyone?  A place to Backup data Safely?

Non ASIC Crypto Mining Cycles on Demand?

All reasonable Questions posed by your neighborhood Colo Partner, the outfit ready to host your Applications at their  power  safe and physically secure site.

The Big question fired back by the semi-interested party, is, as always, What's the price?

Under The Hood, like Obama Care, Mining as A service Can get Expensive  to Run in the Cloud, much cheaper in the Colo

The Answer, as always, coming back from these types is?  "It Depends". 

The semi-interested party looking to build wholesale CMaaS just lost that, 'interest' (in Colo Services) and exits, "Stage right", never to be seen again. ;)

Why such a quick exit? Science experiments trying to determine resource need versus the consumer demands of your application, whatever it may be, are well "painful", not to mention expensive time wise and, time is indeed, money.

The "Fight" (figure it out) versus 'Flight' reaction to the answer above, is often the latter (By the Prospective 'Virtual Miner") . 

"It's 'Just Business', what's the big deal?" blurts the colo partner,  which as most of us would predict, helps speed the previously interested Virtual Mining prospect "out the exit door".

What to do about the mutually missed opportunity?

'Perfect'  that is, automated, self-service price discovery of pre-bundled colo services, accessible from any browser.

Looks Simple, But its Not Easy, Virtual Mining Pools as a Service that is...

Simple to Rack & Cable up the Miners.

Design, Configure, Sourcing Virtual Mining Pools to Investors? Easy Peasy it is NOT.

Sounds simple right? I need some Mining CPU  and RAM "horsepower" on demand to chow down on a mining job because the price is right for cryptocurrency xyx, a GPU CPU coin, ok I will "take a flyer" and rent some compute time on Digital Ocean, load up my OS, VM and container , drop the mining app in the container, replicate it so it becomes my own mining pool and, Voila, "I AM THE MASTER of MY OWN MINING POOL". ;)

I AM a MINING GOD.... (snickers all around...)

Cute, now ask yourself how many people have that skill set? Answer. Not many.., on this continent, in fact I can count them on two hands, not just one hand. :)

Seriously, self-service Mining Pool build is nearing "rocket science" status these days, the new gambling casino table with hi tech croupier mining pool service dealers ready to take your cash on the basis they might get lucky and solve the nonce, win the reward and pay you out your measly fractional reward, depending on how many crypto gamblers "dog pile" during any given mining epoch (cycle).  For the small investor it’s like an 8 year old playing British Bulldog with the big  12 year old kids in summer, ready to kick your ass at a moment's notice. 

That said, it's not just crypto mining which needs perfect price discovery and risk reward analysis to help accurately gauge your chance of success, its every single application on the planet being "shoved to the cloud" so, Jeff B can get to a TRILLION at Amazon, or BillyBob G at Azure can do the same or, those two luckier than shite geeks from Stanford who did the G  search thing, now lazing around in the British Virgin Islands waiting for their stock price to surge upward, yet again. (Just kidding, I don't know where they are, since G lost it's mantra and mojo, which is why Stock Buy Backs are now in, with that ‘in’ crowd.)

OK let's take a look at a near perfect Price Discovery for Colo services and using the mining example, see how a HeatMap User Interface, mashed up with AI engines and Machine Learning Modules can 'hone in on' the right price at the right time, given supply and demand realities for resources in your local colo partner facility.

Can you really Trust this Price Discovery to trigger Mining Pool Work?

The Near Perfect Price Discovery Pipe Dream: Manifesting itself "at a Colo Near You" soon.

First let's get our definitions right.

MASHUP. -  The Cobbling together of open source software 'lego' to get an idea to work, in this case accurate price discovery of compute, network and storage resources at the neighborhood colo (popping up like gas stations everywhere)  with self service deployment, pay as you play (let's say 6 mining epochs for a GPU altcoin as the minimum colo partner price of entry), a 'mashup'  which can be certifiably proven as secure  by a 3rd party expert in security, "cuz its open source" and anyone can examine the contents of your 'Smoor'. 

Colo  Nearby Co-location Operator renting power, cabinet-ed racks with cooling,  Internet Access, Storage as A Service, etc...

UI/UX User Interface, User eXperience 

FE - Front End of Mining Pool Service

BE- Back End of Mining Pool Service

GPU - Graphics Processor Unit

AIE - AI "Artificial Intelligence" Engine

MLm- Machine Learning module , one of several connected and operated by the AIE, this baby does the Price Discovery Calculation

Data Lake-  equipment state & price point logs recorded frequently and stored as received from apps running on  ComputeNodes (GPU servers) found on the colo partner's Fast Storage as a Service storage appliances (computers with a bunch of SSDs "Solid State Drives") ,  where the logs  also contain state over time of the network and storage resources used versus available, measured in some time interval,  all of this log info is needed to calculate how busy things are over a recent stretch of time, so the MLm software can calculate the price for the infrastructure, which is then passed on to the AI Engine  “AIE” which then updates the Heat Map displayed by ColoPartner's Dashboard presented to the Resource Renter, you the operator of your wholesale MMP selling wholesale mining pool time to Retail Mining Pool Managers as CMaaS, expert at handling the market feeds aggregating altcoin prices, so small investors like moi, can jump in and out of various mining pools, per my own Altcoin Price Tracker software, which also manages my multi-altcoin wallet. Confused yet? ;)

OK that should be enough "Taxonomy of Terms" to get the point across.

Now let's fictitiously build the wholesale MMP service.

 

The Virtual Mining Pool Space their are Big Wholesale vs Retail 'BIZ' Differences

Mythical Mining Pool "MMP" Wholesale Service:

Calling all Virtual Mining Pool Managers of type GPU looking for Cheap Virtual Mining Rig costs w/ "Pay as u Play" Pricing 

First Let's set some expectations, caveats, assumptions (ok  you got me, design goals) of the basic  "Mythical Mining Pool " MMP service we are about to mashup for use on your neighborhood Colo Partner's rented compute, network and storage services (Hopefully they have pay as you play pricing, if not you can sell them MMP as a Colo Resource Pool Management Service too):

  1. Equivalent Mining Horsepower at a wholesale price, I can rent the Mining Pool Rig out to  Mining Retailers managing multiple GPU altcoins
  2. Supports Branding and individual mining subscribers managed  Virtual Mining Pool Retail Service Managers 
  3. Can Shrink and Expand "Mining HorsePower" (compute cycles, network bandwidth and Storewidth=IOPs or GB/s Write & Read speed plus Capacity) on Demand relative to Mining Retail Pool Collective ( 2 or more Mining Retail Pools) Demand.
  4. Advertises  and Bills out the Wholesale Price in time increments of 15 minutes (For purposes of this example, totally adjustable in reality)
  5. Feeds an AI Engine MLm rented and operated by the Mining Retailer, who can then use the Data to Set his Retail Mining Fees for the Mining Epoch in Question

Ok enough of 'design goals' (cuz there can always be more, to make sure it get really complicated and you fail.. just kidding) 

 

Understanding the Street Price of Virtual Mining Pool Resource Buy from the Colo Partner: Not as easy as it sounds,  Investopedia CPI Homework to help...

Street Prices of Resources: Why StoreWidth is the 'root'  price determinant for all other resources

 StoreWidth Pricing = Read/Write Speeds in GB/s or IOP/s "InPutOutPut/sec based on 4kbyte random read and write patterns. 

In the lead for Storage is Amazon, their cheapest Cloud Storage Service "Elastic Block Storage" EBS  for Fast "SSD" enabled  Storage is simple and market leading cheap, US$ 65.00/Month per KIOP and 125/mth for 1 TB of SSD block storage   https://aws.amazon.com/ebs/pricing/ '

If we use the current street price of SSD data centre grade media costs, AMazon's EBS Cloud Storage aaS ‘as a Service’ price is 100X SSD media costs ( lots of tech and service overhead  and they need to make a HUGE retail profit, right?)

So using Storewidth from AMZ EBS as the baseline for pricing, we can assume the MMP must be significantly cheaper to attract biz with at least a price advantage, which means the colo partner needs to undercut Amazon with much cheaper Storewidth at wholesale to get the MMP wholesale business from Virtual Mining Pool Rig Operators or Managers. Let's say the MMP gets ColoPartner Storewidth as a Service  at 50X media cost or 50% cheaper than Amazon, doable , as the ColoPartner  today buys wholesale Fast Storage equipment which is carefully configured and optimized to beat out Amazon EBS and still make good wholesale margin rentals, over a three year ‘Fast Storage as a Service” FSaaS Rental Term (here is an example in Toronto, Canada which I know quite well, ;)  https://coredatacentres.com/core-fast-storage/ 

Which begs the BIGGER Biz  MPP viability question, how long is the MMP builder/operator/Resource renter going to be in the game of Wholesale Mining Pool Services? Let me guess, 3 years or more right? Yup, wholesale Virtual Mining Pool Services is a long game (ColoPartner Equipment Leases must be signed, monthly payments must be made, etc..= finite resources available with shortest equipment terms for leasing purposes usually 3 years). So the MMP biz opp is not a short in or out game, doing ‘it’ whenever you want. So the other Question  from the MPP per the customer side of the biz,  re:Mining Pool Retailers is, "how many Altcoins using GPU are there in the addressable regional market and, is there sufficient altcoin GPU mining demand to capture a significant share of Retail Mining Pool Manager biz, to make a go of ‘it’ (The MPP Biz venture)?"  Questions, Questions, Questions...

For the interested party looking to get into Wholesale Crypto Mining as a Service, "Betting the farm" so to speak, on just one Biz play, in this case, the wholesale MMPon it’s own might not be the way to go. However, creating such a business venture can and should be VERY profitable with the right colo partner, willing to entertain  a risk/reward agreement offer from the virtual MMPaaS owner/operator, where the terms (resting in a Smart Contract no doubt)   offered to the Colo partner is to share a portion of the captured mining rewards, in partnership, leveraging both their resources, converged with your MMP "Brain" know how.  Which makes perfect sense imo and, is a win/win for both parties, as the "Pinky" facility and capex/opex 'muscle' rests with the colo partner, who has the access to cheap short money to finance long term equipment rental, paid for by long term service contracts and short and long term colo cage/power/Internet access rental from their facility.  Since you as the "Brain", 'likely'  live in your basement with ZERO overhead, with just a lot of  market/gaming know how, actually has a good understanding of virtual mining pool management of price discovery, which is actually damned useful in this potential market making opportunity. After all you as “Brain”, have been collecting useless gaming rewards for years and actually really understand game theory and thus synthetic currencies, better than most!

Nand Flash Prices for FAST Storage are falling Fast, Making Price Historical Analysis & Price Forecast Simulationvia AI cheap..

Network, Storage and Compute Resource Rental Pricing Calculations:

The Colo Partner Challenge: Use the KISS principle, if you can , to attract Virtual Mining Pool Biz...

OK , now for the MMP direct overhead cost 'wake-up call'.  Its actually a nice surprise this time around, re: Network and Compute resources, that is, these price points are really only about 25% max of the cost of MMP resources, which conversely,  means Storewidth Costs and Prices Rule,  and vendors selling  network bandwidth (Top of Rack TOR Switches Ethernet and PCIe) and CPU Cycles (AMD or Intel 64 core Card equipped appliances w/ 768Gbytes of RAM each) drool (jealously over the margins Storage Vendors make...) . Given Amazon has ‘thrown the gauntlet down’ and set the "street price" for Storewidth and given their capitalization 'girth' (they are the 12 ton Mammoth in the Cloud Infrastructure Space) , we can safely say even Azure and Google  aren't really ‘in the game price AND availability of resources, ease of resource adoption wise, especially given Amazon is devouring most of the available IT DevOps talent out there managing said resources, for at least six months a hiring cycle. ( before they spit 50% of them back out on the street, cuz they could not cut it, or AMZ is too Top Management Heavy & HR 'unencumbered', that is, lousy at qualifying talent for task at hand, to figure it out in the first place. Keep in mind such MegaCompany largesse and HRskullfuddery = your MMP wholesale opportunity!)

(That is, think and act like a Raptor, not like a slow moving, dumb Brontosaurus) 

So whatever Storewidth pricing is, a simple approach is: Network and Compute cost is multiplied by .25 where the cost is split each way evenly between Network and Compute to arrive at what the MMP wholesale buy costs should be from the Colo Partner, given the Amazon street price for StoreWidth with EBS. (the cheapest Cloud form of StoreWidth with decent IOPs performance, which you need for reading up large data sets  (years of logged price data per resource and also altcoins) into Ram accessed by a bunch of FPGA shelved MLms running various price simulations given current recent price movement.)

Ok so now MMP is ‘in the driver seat’ and knows how to negotiate their 3 year Rental of Resources from the Colo, in order to create enough contribution margin based on the wholesale Virtual Mining Rig Resource Pool rental prices they offer, to the Mining Pool Retailer. The question is the discount you offer to the Mining Pool Manager Retailer (of odd/boutique Altcoin Mining)  enough to attract Mining Retailers in the first place?

 Nope They also need the following:

 

Hmm, Not Sure how that works for Virtual Pool Resource Renting? Read on..

Pay As you Play Colo Resource Pricing Convenience and Accuracy which is always cheap, cheap , cheap, regardless of Epoch:

The Virtual Retail Mining Pool Manager Dream- Wholesale Mining Pools as a Service

A Visual Browser (UI) Display and quality CX Customer Experience (UX)  and AIE MLm feed of the Resource Pricing (to drive their own, rented  MLm  AIE hosted Algo instances (think Apps in containers in VMs for ultraCheap CPUs (Competing w/ GPUs),  Metal as Service GPUs  or Algos loaded to FPGAs acting like GPUs) triggering their own Retail Mining Pool access price to investor and share of reward, per altcoin mining Epoch) 

That said, you as the wholesale MMP, need a cut of the 'reward' action to be profitable in a sustainable way, so imo, a risk sharing arrangement makes sense with the Retail Mining Pool Manager, given altcoin crypto price and transaction volume up and downs reacting to 'outside market forces' exemplified by the altcoin changing hash rates (degree of difficulty) or PoS staking amount required to have the right to generate a  coin block(holding transactions) and reap a reward , and maybe the move to more GPU PoS altcoins  versus GPU PoW altcoins.

Heck there are 6000+ Crypto altcoin Assets out there, how's a poor Mining Retailer to cope?

Then add in DEFI and Liquidity Ming Share Rewards... yet another spin on sharing...

 

Liquidity Mining Rewards Digitex Style... SAY What!  How does that work?

 

Wholesales Colo Partner Share in the Virtual Pool Manager's Rewards to help defer Operation Costs? Maybe..

It's complex as it is also for the Investor when they play the Staking Game...

The Question is what is the wholesale MMPaaS reward share Ratio with the ColoPartner, when demand is low, maybe 50/50 risk share makes sense, when trading volume is high maybe the emphasis is more toward 40/60 or even 30/70 MMP vs Pool Retailer. In the end such Virtual Mining Pool rental ‘reward share terms are negotiated once over some set period (variability included , reward success will vary), then  price discovery for the Altcoin via an MLm dedicated thread/core pair match (app/container use of compute node resources) keeps on top of it. (maybe chewing up X amount of memory and a single cpu core and thread pair, assigned 20% of the time as a base resource vale, occasionally 'burping' a time stamped (dNTP) price value out to the Data Lake, so IP/S WRITE speeds are not that important but fast enough to record incoming price streams from the MLm via contents addressable memory read and dual write, one local one to store as it comes in , while reads are to load up MLms continuously with algos and data sets past and current).

Ok now you the reader, and small investor have an "under the hood"  peak at how all this Virtual Mining Rig and Retail Virtual Mining Pool (colo partner) setup works, but the big question remains, how does the Mining Pool Retailer set the fee to the investor for access to the pool?

Well in the end, there is always the risk vs. Reward calculation going on in RT in every Virtual Mining Pool Manager's head, deploy too few resources and the odds , given the other competing Mining Pools for the altcoin in question resources go down (or they get busy because volumes go up and run out of capacity to mine)  'visa vis' your chances of solving the altcoin nonce 'puzzle' in time and thus, the chance of winning the reward in any given epoch also goes down.

Ideally, you as as the mining Pool retailer are always running the ODDS automatically, that is having your rented Retail Virtual Mining Rig always  checking how many competitive pool rigs are up, how many resources these competitive rig pools have running and altcoins they juggling and how busy each altcoin is given investor transactions and well, the number of parameters checks to gauge the odds, before deploying the resources needed to win the reward,  as this number of parameters can climb  fast (and chew-up up core cycles/time and ram), to get a really accurate answer and, that is where AIE and MLm come in, to  efficiently swap in and out different ODD making alogs running simulations of such things, tuning parameters along the way in FPGAs (Pretending to be GPUs running flow programming scripts) , to then make a choice to deploy rented resources (in a pay as you play model, cuz IDLE Rig time is expensive/unproductive) and mine or not..., doing so at cheaper cost than using generic GPU/CPU compute resources.

 

Affirmed Systems Fintech Use of FPGA Arrays to Speed Buy/Seel Trade Simulations referencing Big Price History Data Lakes

Some Secret  "Mining Pool" Resource Sauce to Compete with the Big Boys : Colo Low Latency Infrastructure

Colo Partner Rented FPGA Arrays as part of the Virtual Mining Pool Rent Model: Quant Style Trading Machines Re-Purposed

Which means the design these use in traditional FinTech for RT Quant trading using FPGA racks, is likely a good resource to rent, when you can find some colo partner to rent you a shelf of FPGA Cards running AIE controlled MLM code as a Service, with your altcoin mining specific simulation code making  Behaving like GPUs... (hmm...)  to make you the Low Cost Virtual Mining Rig Pool Leader.

Statistically, you can't win 'em all, but you can get your share and, again, 'Data Science' applies here, where math, AIE and MLm infrastructure  design smarts are 'king' (especially if you can scale it up and down as you need it with a flexible Mining Pool Manager wholesale buy of Colo Partner host MMPas a Service pricing, which accurately reflects the current cost of MPP infrastructure needed given the finite resource available at the neighborhood colo partner facility in which your MMP wholesale "virtual rig" operates.)

What is key? Headless Altcoin Price Maps (aka HeatMaps) are key, to driving the Retail Price Discovery and Update side of the Biz and, also the Wholesale PRice Discovery and Update side of the Biz as well, (Colo Partner Resource Site and effective Wholesale Price at any given time.. driving  Resource Pool Wholesale rental Pricing), where such headless data feeds drive the ODDs algorithms running on MLm for the former. 

 

End of Story

********

Ok, now that write and read of this post are totally exhausted (and maybe confused) its time to go!

Sometimes I need to spit all this stuff out in 'laymen's' terms just to stay sane, even relax!

Enjoy!

Oh yeah, I forgot to mention, I do this stuff for a living, that is design such crazy Dynamic REsource Pool Services...

Stay Safe and, Prosper!

TK over and out.. :)

*****

 

 

 

 

 

 

 

 

 

 

 

 


thunderboltkid
thunderboltkid

Macro Cryptonomic Observations & Insights for investors small & big. I educate, offer tips, forecasts re: tech & people drivers operating "under the hood" moving the crypto market. Working on SOVRINTown Managed transparent & honest evoting & govt spend


Breaking the Small Wind Mold- Darwind5 Circa 2012
Breaking the Small Wind Mold- Darwind5 Circa 2012

This blog is where I post about break thru "non-subsidized" Green Tech anything that helps.. like our new WRRhead four rotor tech (formerly TWIND Power 2 rotor tech) at www.wrrsystems.wordpress.com, and occasionally I talk "BESS" Battery Energy Storage Systems which actually make wind and solar better options when the kWhr costs in below US $125.00 (Zinc Air based BESS VIZN, Zinc8, NantEnergy) with 20 year lifespan, lots of re-charge cycles w/ deep cycle draw ;)

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