Two things are similar in the future: Bitcoin and energy efficiency. Two things are diametrically opposed: Bitcoin and energy efficiency. Bitcoin mining may not sound like a resource intensive process, but it does require a lot of energy. To keep track of Bitcoin mining’s incredible energy discovery, Cambridge University’s Trade Finance Center was created online tool that measures this consumption to the best of its ability and compares it with the energy consumption of other entities to put the horrific amounts into view.
Thanks to the climbing price of Bitcoin, this week the power consumption of the cryptocurrency on top of Pakistan– a nation of more than 200 million people.
This spike in Bitcoin mining is thanks to an explosion in Bitcoin prices. The value of the cryptocurrency has jumped 276% this year alone, trading around $ 27,000 Tuesday with a total market value of nearly $ 500 billion. As MarketWatch points out, this could make Bitcoin not only more energy-intensive, but less energy efficient, as the price spike “has made it more profitable for less expensive equipment. effective use. ”
It’s not just Bitcoin’s energy footprint and gargantuan market value – the carbon footprint is huge too. Last year, however, Bitcoin defenders gathered around a new a study by cryptocurrency investment results and research firm CoinShares found that nearly 75% of Bitcoins mined used clean energy. Unfortunately, that report has now been extensively scrutinized by other researchers, who have found that estimate. greatly overflowing. After all, two-thirds of the world’s Bitcoin mining takes place in China, where more than half of the country’s power is burned by coal.
Related: Russia is looking to become a leader in Hydrogen Tech
In the last few months, this dependence on coal has become a key topic for Bitcoin mining activity in China. Given that China has experienced an energy shortage in recent months, largely as a result of Beijing’s decision to blacklist Australia’s coal, domestic Bitcoin mining has come under siege. While China is still a long way off and the world’s largest trader of Bitcoin, other countries ’energy shortages and increased productivity are closing rapidly.
To date, two-thirds of bitcoin production takes place in China, followed by the United States which represents just 7% of total bitcoin production. The US is closely following Russia and Kazakhstan. But that ranking could soon change as Russia makes a power play to ramp up its mining operations in a campaign led by Gazpromneft, the subsidiary based on petro of Russian natural gas giant Gazprom, the 10th largest producer of oil in the world.
Gazpromneft recently began cryptocurrency mining operations based at one of its Siberian oil drilling sites, “unleashing the power of Russia’s oil and gas resources for bitcoin mining needs,” Yahoo! Finance made a statement this week. In slightly better news for Bitcoin’s carbon footprint, Russia’s new mining activity will be driven by natural gas from the oil field, located in the Khanty-Mansiysk region of northwestern Siberia, which has its own power plant to convert the gas to electricity for Bitcoin production. . And this model has another silver (and green) line: “The CO2 released through oil drilling is usually dependent on oil companies because they have to burn it into the atmosphere, which leads to fines. However, there are ways to use it instead of consuming it, and electricity generation is one of them, ”Yahoo! Financial reports.
The location of the new Russian Bitcoin farm also means that labor costs will be relatively low. Instead of paying a base price for using energy from the grid, finding cryptocurrency mining on site at an oil field means a stable supply of almost free natural gas. All this to say that it was better for China and the US to prepare for some tough competition.
By Haley Zaremba for Oilprice.com
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