FUTURE PROOF CRYPTO MINING
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FLEXIBLE SOFTWARE AND INFRASTRUCTURE SOLUTIONS FOR CRYPTOCURRENCY MINING AT EVOBITS IT WRITTEN BY
HARRY MENEAR PRODUCED BY
LEWIS VAUGHAN
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E V O B I T S I N F O R M AT I O N T E C H N O L O G Y S R L
SILVIU CATALIN BALACI, FOUNDER AND CEO OF EVOBITS IT, SHARES THE ROMANIAN CRYPTOCURRENCY MINER’S PLANS TO UPGRADE ITS CURRENT DATA CENTRE FACILITIES AND GROW ITS HOST OF CRYPTO TRADING SOFTWARE SOLUTIONS
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ith a collective value of around US$275bn, the rise of the global cryptocurrency market has been one of the most revolu-
tionary financial and technological events of the 21st century. Cryptomining, the process by which 04
transactions for various forms of cryptocurrency are verified and added to the blockchain digital ledger, has helped make billionaires of savvy business leaders, but the lack of regulation in the market often leads to instability and unpredictability. In December 2017, Bitcoin reached its all-time high value of $19,783. By November 2018, the price had fallen to approximately $5,500 per coin, and in May 2019 the coin’s value soared again by over $1,000 in less than a day. “The biggest issue right now with crypto and trading in general is the market’s vulnerability to manipulation,” explains Silviu Catalin Balaci, founder, CEO and majority shareholder of Evobits Information Technology SRL. “As liquidity is so low, compared with stocks for example, when a large player jumps in, they can pretty much manipulate
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“ I DIDN’T WANT TO JUST PUT UP A SHED AND THROW MINING MACHINES IN THERE. THAT WOULD HAVE BEEN VERY CHEAP AND FAST, BUT NOT FUTURE PROOF” 06
— Silviu Catalin Balaci, Founder and CEO, Evobits Information Technology SRL
the market as they see fit. That’s why we’ve seen huge spikes one way or another when there are big trades that completely reverse the trend up until that point.” Coupled with the high initial costs of setting up a crypto mining operation, the capricious crypto market might tempt some prospective miners to try something more predictable (alligator farming or Alaskan crab fishing perhaps), but Silviu, a software engineer and owner of one of the largest cryptocurrency mines in Romania, is confident he has the puzzle cracked. “I was always wary of the mining business, because it’s a boom and bust area. I didn’t want to just put up a shed and throw mining machines in there. That would have been very cheap and fast, but not future proof,” he says. For the first three years of operation, EvobitsIT operated exclusively as a software services business, offering full stack programming and consultancy services. “We do start-to-finish turnkey solutions for our customers,” says Silviu. “You tell us the idea, we’ll develop it, design it, host it and manage it; you only have to deal with the marketing side.” While working with a
CLICK TO WATCH : ‘CRYPTO MINING – EVOBITS IT’ 07 client that was also involved in crypto
to operate as dedicated centres for
mining, Silviu had his ‘Aha!’ moment.
non-cryptocurrency activity, providing
“I was consulting for a client on his
a long term strategy should the market
mining business. I’d seen the service he
prove unfavourable. Now, Evobits’
was getting from other companies and
1.2MW facility is nearing completion
told him that I could do it better. That’s
of a significant upgrade, facilitated
how the entire mining side got started.”
by long term partnerships with Vertiv
Entering the mining business with a
Co and Innova Engineering, and a new
100KW proof-of-concept, EvobitsIT then
relationship with AMD. We sat down
built a 1.2MW facility for crypto mining
with Silviu to discuss the initiative,
outfitted like a traditional data centre,
as well as the importance of strong,
followed by a 3.5MW facility which
collaborative partnerships, and the
opened in 2018. Rather than opting for
upcoming launch of Evobits’ innovative
a hyper-minimalist crypto mining design,
new software offerings for the crypto
the Evobits centres have the possibility
mining industry. w w w.evo bi ts it . com
E V O B I T S I N F O R M AT I O N T E C H N O L O G Y S R L
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Evobits’ first data centre was initially
saying, ‘I have a multimillion dollar
constructed with reliability in mind.
project. I want to build a cryptocurrency
“We wanted to build it in the traditional
mining business, and I want to do
sense, so we used old school but
a real data center’. Nobody took me
reliable cooling equipment. They don’t
seriously.” As a result, Evobits ended
have the best power usage effective-
up partnering with a company unsuited
ness (PUE), but they’re like tractors –
to its needs. “It was a pretty bad
they’re reliable workhorses,” Silviu
experience for us,” Silviu recalls.
explains. While constructing the facility,
“It’s the ugly part of starting a business
the first of its kind in the country, Silviu
in a new area that you know little about.
faced undeniable challenges from the
It was a growing experience.” From
market in terms of finding the right
electrical panel overheat issues to poor
partners. “I was just a relatively young
after-sale support, Evobits was in dire
guy with no credibility in the market
need of a new partner to help ensure
the project’s success – enter Innova
the importance of high-efficiency
Engineering. “From the start it was
computer power to a crypto mining
a completely different attitude. Instead
data centre, cooling is undoubtedly
of talking to just the sales guy most
one of the most critical factors,
of the time, the CEO came down and
making Vertiv an immensely valuable
we had a proper discussion,” Silviu
partner. “Whatever power you have,
recalls. Now, every time we have an
you will use 100%, and the less power
issue, they’re working with us to solve
you can use on infrastructure, the
it. I’m extremely lucky to have found
more power you can use for comput-
Innova. I don’t think we could have
ing, which translates to more mining,
done everything that we did without
more customers and more revenue,”
them.” Through Innova, Silviu found
Silviu explains in a statement to Vertiv.
engineering firm Vertiv, who provided
The upgrade of the 1.2MW centre
cooling solutions for the first and
came at an opportune moment. “We
second data centre projects. Given
had a PUE of 1.4 until now, so 40%
E XE CU T I VE PRO FI LE
Silviu Catalin Balaci, Founder and CEO Silviu Catalin Balaci is a technology enthusiast with an entrepreneurial spirit. Starting as a freelance developer at the age of 17, he opened his first software development company at 19. He was constantly involved in emerging technology (both hardware and software), until coming in contact with Blockchain Technology. Recognising the opportunity, Silviu explored all aspects: from consulting, to software development, to mining. He formed Evobits Information Technology SRL in 2014 as a company focused on Blockchain development and the goal of becoming a one-stop-shop for customers through vertical integration. Looking at the future, he is certain of only one thing: not matter what happens, it will be exciting.
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E V O B I T S I N F O R M AT I O N T E C H N O L O G Y S R L
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“I’M EXTREMELY LUCKY TO HAVE FOUND INNOVA. I DON’T THINK WE COULD HAVE DONE EVERYTHING THAT WE DID WITHOUT THEM” — Silviu Catalin Balaci, Founder and CEO, Evobits Information Technology SRL
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E V O B I T S I N F O R M AT I O N T E C H N O L O G Y S R L
of the energy is wasted just cooling the equipment. Which is not that bad for a traditional data centre,” explains Silviu. In 2018, however, Romanian electricity prices increased by around 80%, highlighting more than ever the importance of future proofing. “The 3.5MW facility is equipped with top of the line equipment in every single aspect, including the cooling equipment from Vertiv, which means we achieved a 1.13 PUE last year, including the hot summer,” says Silviu. “We planned to upgrade the first centre anyway but we shut it down 14
three months before the upgrade due to the spike in electricity prices and the crash of the crypto market.” In order to counterbalance the rise in electric costs, Evobits was forced to restructure its energy purchasing strategy. “We were pretty much forced to also become an energy company,” Silviu explains. “We are buying electricity straight from the open market, instead of relying on other companies.” The company is currently buying a mixture of mostly hydroelectric and nuclear power, with plans to purchase a dedicated solar plant in order to compensate for high temperatures in the summer in an environmentally sustainable way.
“ W E DO START-TOFINISH TURNKEY SOLUTIONS. YOU TELL US THE IDEA, WE’LL DEVELOP, DESIGN, HOST AND MANAGE IT; YOU ONLY DEAL WITH THE MARKETING SIDE” — Silviu Catalin Balaci, Founder and CEO, Evobits Information Technology SRL
The 1.2MW facility upgrade will boost its capabilities to those similar to a tier three data centre. “We have everything now: N+2 cooling, N+1 highly efficient Li-ion uninterruptible power supply system (UPS) from Schneider Electric, A+B power feeds, N+1 power generators, redundancies for every system. Our network was upgraded too: dark fibres on separate routes going to the nearest city, local fiber connections from multiple ISPs, as well as rented dedicated transport lines to Bucharest and Frankfurt peering locations so we reduce the latency and increase the quality as much as possible,” lists Silviu. In order to increase the centre’s computing power, Evobits has entered into a new partnership with electronic hardware manufacturer AMD, purchasing over 5,000 cores in the company’s Epyc CPUs and developing a close relationship in order to create custom cloud solutions for its data centre clients. “The next phase will be the launch of an OpenStack-based private cloud in the next two months that is already in the testing phase. This will be exclusively based on AMD Epyc CPUs,” explains Silviu. “The first 100 of our dual CPU servers are ready, racked and deployed. w w w.evo bi ts it . com
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“ T HE 3.5MW FACILITY IS EQUIPPED WITH TOP OF THE LINE EQUIPMENT IN EVERY SINGLE ASPECT” — Silviu Catalin Balaci, Founder and CEO, Evobits Information Technology SRL 17 This year we plan on buying another 300 dual CPU servers.”. “Sourcing
Supermicro based servers”. 2019 will also mark the launch of
hardware at a larger scale is not as
cryptocurrency products that are more
easy as it seems. Just like when we
closely tied to Evobits’ roots as a
started with the Data centre business,
programming and software services
we were new in this and had to find
provider. Firstly, as data centre
someone to help us navigate around.
pioneers at scale, Evobits’ staff has
There are plenty of hardware distribu-
had to build a great deal of its software
tion companies around, but you can
from the ground up, which the compa-
count the really good ones on one
ny plans to start selling as a service in
hand. This time we were lucky, how-
partnership with Enova. “Using AI
ever, and found International Computer
monitoring, Google managed to drop
Concepts, a very easy to work with
their power consumption for cooling by
and dependable company. They were
about 40%. We have our monitoring
crucial in providing our first 100
platform completely done. We have w w w.evo bi ts it . com
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terabytes of data from the past year regarding airflow, temperatures of each individual machine in each position, outside temperature and so on. Now we’re doing the machine learning part, and we’ll start testing that side out towards the end of the summer.” Also embracing the company’s origins as a software provider is Evobits’ next solution, which aims to address the issue of unsafe crypto trading. “The problem with starting the next PayPal is that you have to trust PayPal,” posits Silviu. “The customer 18
pays you, but your money is actually in PayPal. They will send it to you. If you have an issue with them or they have an issue with you, you’re pretty much stuck. The main point of cryptocurrencies is to have a trustless system where
a value of over $100mn in 2018.” Silviu
you are in charge and responsible.”
explains. Evobits’ platform will provide
Operating in closed beta and scheduled
a complete inventory management and
for launch in summer 2019, Evobits’
invoicing tools, and monitor peer-to-
latest offering is a trustless cryptocur-
peer crypto transactions to regulate
rency invoicing platform. “It’s similar to
the exchange, but won’t require users
PayPal but for cyrptocurrency coins,
to trust them with their hard-earned
and it’s a trustless system, meaning we
coins. Silviu agrees that, in a market
never touch the money, we just provide
with so little regulation, trustless
all the tools required and peek through
systems are a large part of the way
the window to detect the payments.
forward. “You see so many people
We already processed invoices with
losing their money when cryptocur-
€15mn Approximate revenue
2014
Year founded
10
Approximate number of employees
rency platforms close, go bust or get
centre business complain about –
hacked. The best way forward is to
there’s the energy consumption, which
remove that single point of failure.”
is still really high and needs to be
Looking to the future, Silviu is
addressed,” he says. “As long as those
enthusiastic about cryptocurrency
things get fixed, then honestly this
mining and the growth of Evobits, but
industry has a great future.”
acknowledges that both cryptocurrencies and crypto mining need to mature. “The market needs to be regulated one way or another; it needs to follow the trustless system; and thirdly – this is something that most people in the data w w w.evo bi ts it . com
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Evobits Information Technology SRL Wolfgang Amadeus Mozart Nr. 3, 320236 Caras-Severin, Romania www.evobitsit.com