What is mining

Cryptocurrency mining remains a relevant way of investing and generating income, but the main factor in profitability is still the cost of electricity. At high tariffs, even the most productive farm can work “in the negative”.

The group of companies “MKS” offers two solutions to this problem on the basis of block-modular mini-CHP:

1. Purchase of block-modular mini-CHP. You purchase from us a mini-CHPP fully ready for start-up, which does not need to be built.
2. Conclusion of an energy service contract. The block-modular mini-CHP is installed at your site without any investments from your side. You pay for actually consumed electricity at a reduced tariff fixed in advance in the contract.

What is mining

Mining is the process of creating new blocks in a blockchain and confirming transactions using the processing power of hardware. For performing these tasks, miners are rewarded in the form of cryptocurrency. The main purpose of mining is to ensure decentralization and security of the cryptocurrency network.

A miner is an individual or legal entity (or equipment) involved in the process of mining. Miners use special devices - ASIC miners or video cards (GPUs) - to solve the mathematical problems necessary to add blocks to the blockchain and earn rewards.

A mining pool (or simply a pool) is an association of several miners who work together to mine a single block. When a pool finds a block, the reward is distributed among its members in proportion to the computing power provided. Pools allow miners to earn a more stable and predictable income compared to solo mining.

A mining farm is a specially organized room or facility that houses several devices for mining cryptocurrencies. Usually, a “farm” refers to a set of equipment: video cards (GPUs) or specialized integrated circuits (ASICs) combined into a single system for the purpose of 24/7 mining.

Cryptocurrency is digital money that exists only on the internet and is not controlled by banks or governments. It works thanks to special technology and is supported by a large number of computers around the world.

A cryptocurrency wallet is a software or hardware tool designed to store, send, and receive cryptocurrency. It does not store the coins themselves, but contains keys — primarily a private key that gives access to the cryptocurrency stored in the blockchain.

Cryptocurrency is not stored inside the wallet, like money in a wallet. It is located in a distributed blockchain network, and the wallet simply gives you access to these coins using a private key. A wallet is an interface for accessing your funds in the blockchain.

A blockchain is a decentralized and secure digital database in which information is recorded in sequential blocks linked together in a chain. Each block contains transaction records, the hash of the previous block, and its own hash, making it impossible to tamper with the data without changing the entire chain.

A crypto exchange (cryptocurrency exchange) is an online platform where users can buy, sell, exchange, and sometimes store cryptocurrency. It acts as an intermediary between sellers and buyers of digital assets.

P2P (peer-to-peer) is a way of exchanging cryptocurrency directly between users without intermediaries (for example, without the participation of the exchange itself as a custodian of funds). In the context of cryptocurrency 

P2P trading is a transaction in which one user transfers cryptocurrency and another transfers fiat money (e.g., rubles) directly, via bank transfer, SBP, YooMoney, and other payment systems.

Farms can be:

Home-based — a small number of devices located in an apartment, garage, or utility room.
Industrial — large sites with dozens or hundreds of machines, often located in containers, hangars, or specially constructed buildings with sophisticated ventilation, power supply, and fire safety systems.
The purpose of creating a farm is to make a profit by mining cryptocurrencies, where the main factors of profitability are:

• equipment power (hash rate),
• the cost of electricity,
• the current exchange rate of cryptocurrencies, and the complexity of the network.

What is mining in simple terms

Mining, in simple terms, is a complex process of confirming and protecting cryptocurrency (electronic money) transfers using a variety of devices that perform mathematical calculations and receive a commission for ensuring the security and correct operation of the network. But even such a simple explanation of the mining process will not give a complete picture without understanding the concept of how it works.

How mining works

Imagine that there is a seller and a buyer who want to exchange virtual tokens (digital money linked to real currency) through a special website. To ensure that the transaction is fair and no one cheats, a team of mathematicians consisting of completely different people from all over the world (miners whose computers will perform complex calculations) is connected. Mathematicians (miners) do not control the system and cannot falsify data because their task is to solve a complex problem and come to a common answer with other mathematicians (miners).

The buyer pays these mathematicians a commission to verify and confirm the validity of the transaction. The site automatically creates a unique and complex mathematical problem. Mathematicians solve the complex problem, and when all mathematicians individually come to a single answer among themselves, the transaction is considered complete and secure. After that, the virtual tokens are confirmed and transferred to the seller, and the mathematicians are paid a commission for their work.

This mechanism is called mining. It makes the system secure and fair — no one can falsify records because everyone is watching each other.

In this example:

A mathematician is a miner. This is someone who solves the problem (searches through hashes) and receives a reward.
The process of solving the problem and confirming the answers is the mining process. It is a computational process in which miners verify transactions and find a suitable hash. The task is given to miners by the cryptocurrency system, i.e., the program algorithm on which this network operates (for example, Bitcoin, Ethereum, etc.). The rules of the network were established by the creators of these networks.
A pool is an association of miners (mathematicians) who jointly solve the problem to increase the chance of a reward and then divide it among themselves.
A blockchain is a common chain of records (blocks) that stores confirmed transactions (mathematicians' correct answers) added as a result of miners successfully solving problems. Miners solve problems → create a block → the block is added to the chain → this chain is the blockchain.
A hash is a set of random letters and numbers that is obtained from any data (text, file, number) using a special mathematical formula — a hash function.

In cryptocurrencies, hashes help protect information and verify integrity during transfers or in the mining process. Computers try out different values to find a hash that fits certain rules. One of the most famous hash functions is SHA-256.

SHA-256 is used in Bitcoin to encrypt blocks and mining, as well as in digital signatures, passwords, and data protection — to make sure no one has faked anything.

Mining speed

Mining speed is measured in hashes per second – called hash rate.

1000 Hash/s = 1 KiloHash/s

1000 KiloHash/s = 1 MegaHash/s

1000 MegaHash/s = 1 GigaHash/s

1000 GigaHash/s = 1 TeraHash/s

1000 TeraHash/s = 1 PetaHash/s

1000 PetaHash/s = 1 ExaHash/s

1000 ExaHash/s = 1 ZettaHash/s

Hash rate converter

The average speed of modern graphics cards is 100 megahashes per second (Mh/s), which is equivalent to 100,000,000 hashes per second. In other words, modern graphics cards are capable of processing 100,000,000 hashes per second of input data, running them through a hash function until they find a suitable result that meets the network's requirements.

Internet speed for mining

Mining does not require high internet speed — it is not speed that is important, but connection stability and low latency (ping). During mining, the internet is only used to receive tasks and hashes for sorting. In file form, this data weighs 1 KB - 20 KB (kilobytes) of space. Even mobile internet can handle tens of thousands of such files. In addition, these files are divided into smaller parts and transmitted in packets via the TCP\IP protocol. This speeds up the process thousands of times.

Minimum internet speed for mining:

Download speed: from 0.5 Mbps to 1 Mbps

Upload speed: from 0.2 Mbps to 0.5 Mbps

Ping (delay): preferably less than 100 ms to the pool server.

The video card (or ASIC) does all the heavy work of searching through hashes locally, and via the Internet it only transmits the answers found (shares) and receives new tasks.

You don't need fast Internet for mining, but you do need reliable Internet with minimal interruptions and delays. Even 1 Mbps is enough.

Why does mining require a lot of electricity?

In the mining process, the speed of solving tasks (balls) is very important. The faster your equipment solves the task, the larger share of the payment you will receive relative to other pool participants, and the less electricity you will consume. But this is only theory, and in practice, higher performance always comes up against the cooling system, and increased load on the cooling system means additional electricity consumption and increased wear and tear on all equipment. Therefore, in mining, you always need to find a happy medium and, for a faster return on investment, engage in overclocking, downvolting (undervolting), finding the most compatible drivers for the algorithm tasks, finding the most productive operating systems, additional software for mining, finding the region with the cheapest tariffs (the price of a power outlet in the language of miners), and so on. The power supply also affects electricity consumption. The lower the power supply class, the cheaper the components in it, and the cheaper the components in the power supply, the more electricity you lose and the lower the efficiency of the entire installation as a whole.

The uniqueness and popularity of mining

The uniqueness of mining lies in the fact that it allows for the secure and transparent confirmation of digital money transfers without the involvement of intermediaries (banks, governments) — thanks to the fact that information is stored and verified simultaneously on many computers around the world. To do this, devices solve complex encryption tasks using special algorithms on dozens and hundreds of computers simultaneously, making the system impossible to hack or falsify.

It is this decentralized system of data storage, verification, and protection that makes cryptocurrency mining special.

Mining equipment

The most common mining methods are video cards (because they are found in all computers and in almost every home) and ASICs (ASIC Antminer).

Mining on graphics cards (GPU)
Used to mine coins such as Ether (ETH), Ethereum Classic (ETC), Ravencoin (RVN), Ergo (ERG), and thousands of others. Popular among home users and small farms.

A small mining farm on video cards (5 video cards are located on top, connected to a single motherboard at the bottom)

Pros:

- A huge selection of graphics cards. Almost all graphics cards from 2016 with more than 6GB of video memory are capable of mining profitably. Older cards can also be used for mining, but you will incur losses when you factor in electricity costs.

- Low entry threshold. You can start mining even on cheap and old GeForce GTX 1060s.

- Flexibility in choosing coins. You can mine almost all types of cryptocurrencies.

- Video cards can be sold quickly and profitably on the secondary market after breakdowns and wear and tear.

- Low noise level.

Cons:

- Long payback period

- Low income.

At the same cost of an ASIC and a PC with a good video card, the video card will earn 2-3 times less cryptocurrency.

Mining on  (Application-Specific Integrated Circuit)
Specialized devices created exclusively for mining specific algorithms. An example is the Antminer S19 for Bitcoin (SHA-256 algorithm). They provide maximum efficiency but are not versatile and are not suitable for other tasks.

Pros:

- High stable profitability

- Optimized for a single algorithm

Cons:

- Cannot be used for other tasks

- Noisy, hot, requires good cooling

- Quickly becomes obsolete after hard forks or algorithm changes

- Difficult to sell on the secondary market after breakdown or minor wear and tear

Additionally, there are other types of mining:

On processors (CPU)
Used less and less, but relevant for some cryptocurrencies with ASIC-resistant algorithms, such as Monero (XMR, RandomX algorithm). Suitable for mining directly on a regular PC. If the PC has a good cooling system and processor, then in addition to mining on the video card, mining is additionally connected to the processor so that it does not idle.

• on hard drives (HDD/SSD) — “Proof of Capacity / Space”
  Based on the use of free disk space, for example Chia (XCH). Does not require high energy consumption, but requires a large volume and speed of disk read/write.
• through staking (Proof of Stake, PoS)
  Although formally this is not “mining” in the classical sense, the user also receives a reward for confirming transactions. Examples: Ethereum (after switching to PoS), Cardano, Solana. Requires ownership of coins and locking them in a wallet or pool.
• Cloud mining
  Renting power from a remote data center. Does not require the purchase of equipment, but carries high risks (including fraud).
• On FPGA (Field Programmable Gate Array)
  Rarely used, an intermediate option between GPU and ASIC. Allows you to configure algorithms, but requires technical skills.
• On phones.

Modern smartphones have already caught up with mid-range PCs in terms of performance and continue to develop at a rapid pace. Mining on phones is gaining momentum and becoming more popular, as everyone has a phone and the low price threshold for entering phone mining. There is a huge abundance of software for Android smartphones and it is easy to install without specialized knowledge. Mining algorithms on smartphones:

– RandomX (for Monero)

– CryptoNight (the old Monero algorithm, replaced by RandomX)

– YesPower (used by some lesser-known coins)

In Asia — especially in China, Vietnam, India, and some parts of South Korea — there are factories and underground workshops where smartphones are used en masse for various automated tasks:

• voting and social media boosting farms,
• bot farms (for TikTok, YouTube, streaming),
• fake app installations (to get bonuses),
• and for mining cryptocurrencies.

How mining works on smartphones:

• batteries are removed from phones,
• they are connected to an external power supply (via USB hubs with 100+ ports),
• forced cooling is installed (e.g., fans, heat pipes, sometimes even air-conditioned boxes),
• Monero (XMR) mining is launched on the devices using the CPU and the RandomX algorithm,
• after the devices wear out, they are sold as “almost new” or “test” — especially in online stores on Asian platforms (AliExpress, Taobao, etc.).
  Why do they do this:

On budget Android smartphones, it is possible to earn a minimal income from mining Monero or similar coins if:
electricity is free or subsidized (government programs, industrial tariffs),
the devices are obtained cheaply (secondary market, factory defects, test batches),
the goal is scale, not profit from a single phone.

Will mining on smartphones be profitable in 2025?

Experts from the MKS Group of Companies believe that in Russia, with the current cryptocurrency exchange rate and electricity prices, mining on smartphones is not profitable, and even if one of the conditions is met—free electricity or free devices—mining on phones will be unprofitable and long-term. This is due to withdrawal fees and penalties for storing cryptocurrency on cryptocurrency exchanges. In most cases, this form of mining exists due to the spread of malware and the abundance of newbies who want to try their hand at mining.

To determine whether a device has been used for mining before purchasing it, you can check the information in special files that store history - logs. The logs contain traces of hidden applications and mining APIs.

How much electricity does mining consume

To calculate the monthly power consumption of an RTX 5090 graphics card with a consumption of 600 W, we use a simple formula:

Consumption (kWh) = power (kW) × operating time (hours per month)

Let's assume that the card operates around the clock:

• 600 W = 0.6 kW
• Per month ≈ 30 days × 24 hours = 720 hours

0.6 kW × 720 hours = 432 kWh per month

Total: 432 kWh per month when operating around the clock.

If it operates, for example, 12 hours a day, then:

0.6 × 360 = 216 kWh per month

Even a single mining rig consumes a significant amount of electricity. For example:

ASIC Antminer S19j — about 3250 W, monthly consumption ≈ 2340 kWh.
GeForce RTX 5090 graphics card — about 600 W, when running 24/7 ≈ 432 kWh per month.

ASIC Antminer S19j is a ready-made solution, while in the case of a video card, you need to additionally purchase a full-fledged computer with a modern motherboard, since video cards cannot be plugged directly into a power outlet. 

To get the most out of the Nvidia RTX 5090 graphics card, you need a modern motherboard with a PCI Express 5.0 (PCIe 5.0 for short) connector in x16 mode. This is because if you use older motherboards with PCIe 4.0 or lower connectors, the connection interface will be a bottleneck and will affect the speed of income.

The modern mining community believes that modern video cards are not only more profitable to install in modern motherboards, but also much safer in terms of having a greater number of lines. The motherboard itself is also not capable of operating directly from a power outlet and requires a processor (alternative name CPU, central processing unit), random access memory (RAM), a cooling system, and, of course, a power supply.

All of these are parts of an electrical circuit and consume varying amounts of electricity. Therefore, it is very important to use the total consumption of the entire system in your calculations and not limit yourself to just one video card.

Accordingly, when using a pair of ASICs or a small pool of computers with video cards, the user quickly exceeds the limits set for individuals.

Electricity limits for individuals in Russia

Up to 3900 kWh per month — individuals can consume electricity at a preferential rate.
Up to 6000 kWh per month — you can engage in mining without registering as an individual entrepreneur.
However, these limits only allow for 1–2 ASICs or 10–15 video cards. Any expansion leads to a violation of the law or an increase in the cost of electricity.

Cryptocurrency exchange rate

Just as the dollar or euro are considered base currencies in the global economy and are used for market orientation, Bitcoin (BTC) or Ethereum (ETH) are considered the main benchmarks for determining the exchange rate and dynamics of other cryptocurrencies.

Bitcoin is the first and most capitalized cryptocurrency, often referred to as digital gold.

·         Bitcoin is the first cryptocurrency
It was created first (in 2009), and it was with Bitcoin that the whole history of cryptocurrencies began. Therefore, it is considered the main or “basic” currency in the crypto world — like the dollar in the world of conventional currencies.

·         The most interest and money
Bitcoin has the most real money invested in it, including large investments, exchanges, funds, and even some banks (JPMorgan Chase, Morgan Stanley, Goldman Sachs, BNY Mellon, Sygnum Bank (Switzerland)). Therefore, its exchange rate affects confidence in the entire crypto economy.

· Many cryptocurrencies are traded through Bitcoin
On exchanges, people often buy Bitcoin first and then exchange it for other coins. Therefore, if Bitcoin falls sharply, all other coins also lose value because demand for them falls along with it.

·         Psychology and the market
People think, “Bitcoin is falling, so everything is bad in crypto,” or vice versa. It's like a mood indicator: if it rises, many people think that it's a good time to invest in other coins.

Ethereum is the second most important platform on which many other cryptocurrencies and projects (decentralized applications, tokens, etc.) are built.

The difference between the low purchase price of assets and the high selling price can be used to earn a margin or spread, which is called crypto trading.

Crypto trading is the process of buying and selling cryptocurrencies with the aim of making a profit from fluctuations in their market prices. Traders use various strategies (e.g., short-term speculation, long-term investment, arbitrage) and technical or fundamental analysis tools to make decisions. Trading takes place on cryptocurrency exchanges, around the clock, often using leverage and automated algorithms.

An example of a basic crypto trading strategy
You see that the Bitcoin price has fallen to 7 million rubles. Expecting it to rise, you buy 1 BTC at this price. A few days (or months) later, the price rises to 8 million rubles, and you decide to sell. The difference between the purchase and sale price is +1 million rubles.
This is your gross profit (excluding exchange commissions and taxes).

The topic of crypto investments, trading strategies, various market forms, and account types is extensive and does not directly relate to saving electricity by installing mini-CHP plants based on gas piston engines.

In which countries can you pay with cryptocurrency?

By 2025, cryptocurrency can be used for official or partial payments in a number of countries. Below is a list of countries where the use of cryptocurrencies is permitted by law or supported by the state, as well as actively used by private businesses.

Countries where cryptocurrency is an official means of payment:

El Salvador
This is the first country to recognize Bitcoin as an official currency alongside the US dollar. In the country, you can pay with Bitcoin in stores, cafes, gas stations, and even pay taxes. The state has created the Chivo crypto wallet and is actively developing the infrastructure.

Central African Republic (CAR)
This is the second country to recognize Bitcoin as legal tender. Although the level of infrastructure development there is low, cryptocurrency has official status, and a blockchain-based digital economy is planned for the future.

Countries where cryptocurrency is legal and widely accepted by private businesses:

Germany
Cryptocurrency is recognized as private property and regulated as a financial asset. Some stores, online platforms, cafes, and even car dealerships accept payment in cryptocurrency, mainly in Bitcoin. Berlin is considered one of Europe's crypto hubs.

Japan
One of the most advanced countries in terms of crypto legislation. Bitcoin and other cryptocurrencies are officially recognized as a means of payment, and cryptocurrency exchanges operate under license. More than 250,000 retail outlets, including major retailers, accept cryptocurrency.

Switzerland
Although cryptocurrency is not an official currency, it is actively used in everyday transactions, especially in the canton of Zug, which has been nicknamed “Crypto Valley.” Some municipalities allow taxes to be paid in cryptocurrency.

Singapore
A legal and favorable jurisdiction for cryptocurrencies. Some establishments and online services accept payment in digital currencies. The regulator (MAS) controls crypto exchanges and the implementation of blockchain technology.

United States of America
At the federal level, cryptocurrency is not recognized as legal tender, but in some states (such as Colorado), taxes can be paid with cryptocurrency. Private companies, cafes, hotels, and online platforms accept Bitcoin and other tokens.

Cryptocurrency is also used in settlements and accepted as a payment method in countries such as Canada, the United Kingdom, South Korea, Australia, Brazil, and the UAE — at the level of private businesses or individual cities and regions.

In most cases, mobile crypto wallets, QR codes, and special terminals are used to pay with cryptocurrency.

Why it is worth legalizing mining as a business and connecting to a mini-CHP plant

The MKS Group of Companies offers a solution: the construction of a mini-CHP plant on the customer's premises or nearby, connection through a legal entity, and the conclusion of an energy service contract. This opens up the following opportunities:

Reduction of the electricity tariff — up to 4.5–6 rubles/kWh, which is lower than market prices in most regions of the Russian Federation.
Legal security — conducting activities on behalf of a legal entity and compliance with all regulations.
Resistance to voltage surges — own generation eliminates drops that often destroy equipment.
No power limits — connection is possible at 1, 5, 10 MW and above.
Independence from power grids — an industrial gas pipeline is sufficient.
 

Comparison: Power grids vs. mini-CHP plants

Data is current as of June 2025

When mining becomes profitable

For mining to be profitable, the approximate cost of electricity should be:

up to 6 rubles/kWh — for the latest generation of ASICs;
up to 4.5 rubles/kWh — for mining on video cards.
Calculation example:

ASIC consumes 3250 W → per month ≈ 2340 kWh.
At a rate of 9 rubles → costs = 21,060 rubles/month.
At a rate of 6 rubles → costs = 14,040 rubles/month.
The difference is 7,020 rubles/month per device.
 

Mining equipment profitability and payback period

* at average network difficulty and an exchange rate of 1 BTC = 65,000 USD.

The internet is full of calculators for miners, where you can not only calculate the payback period for a single device, but also compare it with other devices and calculate the payback period for an entire farm.

What to consider when withdrawing cryptocurrency

• Most exchanges require verification and indicate the origin of funds.
• When withdrawing to a card or settling accounts, a tax liability automatically arises.
• Storing large amounts of cryptocurrency without proof of mining or trading may result in blocking and fines.
• Registering a legal entity and withdrawing profits through it allows you to avoid claims, pay taxes transparently, and reduce risks.

The cheapest electricity for mining

Unlike those factors that miners cannot influence, there is a solution that will help increase the economic attractiveness of mining farms—installing your own mini-CHP plant.
1. Purchase of a modular mini-CHP plant
You purchase a mini-CHP plant from the MKS Group of Companies that is completely ready to launch, requiring no construction or approval from government agencies. The mini-CHP plant arrives at the site in the form of ready-made modules, is mounted on a pre-prepared foundation, and is connected to the infrastructure within two weeks!
Advantages:
•    Minimal commissioning time
•    High reliability and autonomy of power supply
•    Possibility of parallel connection to heat supply
•    Full control over the facility and revenue from own generation
2. Conclusion of an energy service contract
We implement the project at our own expense. The block-modular mini-CHP plant is installed on your site without any investment on your part. You simply pay for the electricity you actually consume at a reduced rate fixed in advance in the contract.
Advantages:
•    Energy savings from the very first days of operation
•    Stable supply of electricity and heat
•    Complete independence from limits and voltage surges
•    The ability to implement the project without investment under an energy service contract — MKS assumes all capital costs and risks. You only pay for the resources you consume at a reduced rate.
Under the energy service contract, the MKS Group of Companies:
•    builds and commissions mini-CHP plants;
•    assumes all investments, risks, and operation;
•    supplies electricity at a fixed rate lower than the grid rate;
•    the customer pays only for the electricity actually consumed at a pre-agreed price.

This way, the customer gets access to cheap and stable electricity without any investment, completely legally and with the possibility of scaling.
We offer not just equipment, but a ready-made turnkey solution tailored to the needs of mining. Want to find out which option is best for you? We will do the calculations and prepare a personalized offer.

Conclusion
Electricity is a key factor in mining. The cheaper and more stable it is, the higher the profitability and security of the business. The MKS Group of Companies offers a comprehensive solution based on mini-CHP plants: from design and construction to the supply of energy at a reduced price. Whether you are the owner of a home farm or planning to launch a large data center, we will provide you with a reliable and cost-effective source of energy.

© MKC Group of Companies LLC, 2025