Brookstone Partners, a private equity company plans on installing a 900-megawatt wind farm in southern Morocco to aid a Bitcoin mining operation. This news by Bloomberg has been preceded by numerous other projects of producing clean and renewable energy all over the world with one mission in mind; Obtain new renewable power sources to ensure that no carbon print produced can be attributed to the mining of the cryptocurrencies.
The astounding advance in the mining of Bitcoins has had detrimental implications. It is a fact that the more bitcoins are mined the more difficult and complicated the mining of the rest becomes. In this case, complexity is directly proportional to the amount of calculations required to make a guess. Moreover, to make these calculations you require the appropriate hardware as well as electricity. Mining becomes arduous, as the more of these are found. As this suggests that with time, the energy consumption by these operations is bound to increase so they are assisting in damaging the environment by excessive usage of electricity whose production has massive carbon print. An Icelandic member of parliament, Smári McCarthy said,
We are spending tens or maybe hundreds of megawatts on producing something that has no tangible existence and no real use for humans outside the realm of financial speculation,
This raises a valid concern. Is it really worth it to risk the safety of the environment only to mine cryptocurrencies?
It has been assessed that a total of 132 years will be required to mine all the bitcoins i.e. 21 million. Moreover, given the fact that only a fraction of those have been mined, there is a long way to go to get to the expressed estimate. In order words, a colossus source of energy is required to get to that mark. According to Bloomberg Energy Finance, there has been an exponential increase in consumption of electricity by the bitcoin mining industry and can still consume mining revenues as much as 60%. Alex de Vries, the PwC consultant who founded Digiconomist said,
All of those machines are consuming at least as much as Ireland and probably a lot more, especially by the end of the year.It could be as much as the whole of Austria in terms of energy consumption.
According to the Digiconomist bitcoin energy consumption index, bitcoin already consumes 0.15% of the world’s energy. Sebastian Deetman, a climate policy researcher at the PBL Netherlands Environmental Assessment agency, illustrated on Motherboard that, by 2020, Bitcoin mining that required only a PC or a laptop could consume as much electricity as Denmark. Even the great minds behind the creation of blockchain technology have expressed concern over the giant consumption of electricity and its adverse effects on the environment. The founder of ethereum, Vitalik Buterin said in an interview with the New York Times,
I would personally feel very unhappy if my main contribution to the world was adding Cyprus’s worth of electricity consumption to global warming,
Needless to say, the need of hour was to find ways to mine Bitcoins, that are environment friendly and the answer is ‘Renewable Energy’.
Ever since the adverse effects of have made headlines, companies and investors have been eager to invest in installation of renewable sources of energy such as sunlight, wind, rain, tides, waves, and geothermal heat. Places like Canada, Iceland and Paraguay are attracting more and more investors to setup their own sources of clean energy. These countries have desirable temperatures to house the machinery that emits a lot of heat.
Among these countries, Switzerland has shown a lot of enthusiasm in adhering itself to the changing trends of producing electricity through renewable sources, for mining bitcoin as well as for other purposes. Apart from the ideal weather provisions, there are corporations dedicated to eco-friendly crypto mining. One of them is the Swiss Alps. The idea is to house mining power units also known as Swiss Alps Mining (SAM) cubes, which is a modular system, inside the empty buildings across the Swiss Alps. Using this technique ensures that the company will not only save energy but also make the mining process up to 50% more profitable.
Gogokhia, Golden Fleece’s 28-year-old chief executive officer and a former employee of the state-owned electricity grid told Bloomberg Energy Finance;
To conquer the riches of cryptocurrency, we undertook the quest to build cheap, green and sustainable mining farms in Georgia.
Furthermore, to minimize the issue of overheating of the electrical components being used to make myriads of calculations, the mining equipment comprising of high powered computing machinery is being installed in places that are classified as having lesser temperatures. These temperatures will ensure that the mining facilities are not overheated nor require cooling units, which could potentially require even more electricity. In addition, the electrical equipment required for mining cryptocurrencies is not cheap and not easily replaceable.
The decentralization of cryptocurrency offers the advantage that it can be mined anywhere in world. It implies that you could establish a setup to mine bitcoins in a fundamentally desirable place. A place that is cold and has plenty of natural resources to spare. Christian Catalini, who founded the Crypto Economics Lab at the Massachusetts Institute of Technology told Bloomberg Energy Finance;
The price of electricity mostly drives where mining is taking place. If the price of electricity increases in one location, mining will likely just move somewhere else.
Albeit many influencers have expressed their concern of the growing use of electricity for bitcoin mining and the potential harm it could cause to the environment, numerous companies have been fleeing from the usage of energy sources producing carbon print to the renewable energy sources. It is high time that the issues that arise by mining bitcoins be addressed in a timely fashion. Making progress in technology and acquiring monetary benefits from bitcoin maybe the priority of the masses but sacrificing our environments safety is too big a price to pay.