Bitcoin Mining’s Energy Issue: The Controversy, Motivation and Innovation

Bitcoin Mining’s Energy Issue: The Controversy, Motivation and Innovation

Posted Thursday, July 15, 2021 by
Sophia Cruz • 2 min read

There is still an ongoing debate about Bitcoin and the fact that it consumes too much energy. This debate is significant, and each side has its own definite point of view. This Bitcoin mining issue has been a bone of contention for several years already, but it has resurfaced recently thanks to the controversial points of view of  Elon Musk and Jack Dorsey. So, what is everyone debating about? Bitcoin mining uses Proof-of-Work, which is the process by means of which a computer races to be the one that validates the next block of transaction data by solving a complex mathematical riddle, for which it gets new coins in return. Bitcoin mining is prone to causing environmental issues and blackouts, with several incidents havng been reported from different countries.

China has officially banned crypto mining and miners are fleeing to countries that allow them to operate. This has fanned the ever-lasting flame of the bitcoin mining issue, but on a good note, it also motivated energy and mining companies to come up with a greener alternative.

To better and greener Bitcoin mining

It was announced today, July 15, that Compass Mining has created a partnership with Oklo to mine Bitcoin using nuclear energy. Bitcoin mining startup, Compass Mining, has a 20-year contract deal with Oklo, a nuclear fission company that builds microreactors. Oklo’s advanced fission powerhouses will produce clean, dependable, low-cost baseload power. This will supply the mining firm with carbon-neutral energy to power their mining farm, which is set to be launched in 2023 or 2024.

Financial payments company, Square, together with Bitcoin infrastructure company, Blockstream, is set to build a solar-powered bitcoin mining facility. This will be established at an existing Blockstream location.

Kazakhstan has been the apple of the Chinese miners’ eye. In July 2021, BIT mining, a Chinese bitcoin mining firm, shipped its first batch of 320 crypto rigs to the country. The company is set to deliver another 2,600 machines, to bring it to full operation and make use of the cheap power in Kazakhstan. Crypto mining is also legal in this country, which makes it a favorable spot for BTC miners. Currently, there are 20 crypto farms operating in Kazakhstan.

In Conclusion

Following each crackdown event, it is hard to predict how long the hashrate deficit will last. Most mining experts mention that it could take from 6 to as long as 15 months for the companies to get every machine and each piece of hardware established. As we wait for a greener bitcoin, crypto mining firms that were affected by the crackdowns are continuously rebuilding their companies. Others, like the US bitcoin mining companies, are booming, and benefiting from a continuous capital inflow. The projects for greener energy sources are said to be helping the BTC price move upwards, as more companies see this as an investment opportunity for partnerships and collaborations.

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