Bitcoin Mining and ESG: a heavenly encounter

Bitcoin mining was unable to shake its dirty reputation.

Producing the original cryptocurrency and securing its proof-of-work network is an energy-intensive process — we all know that — and bitcoin’s carbon footprint is significant. Very large. The statistics are easy to find and frequently used in news stories: the network of the largest digital asset consumes as much or more electricity in a year than many countries.

More recently, evidence has shown that since the crackdown in China last year, bitcoin mining has become a less green activity. Indeed, when most bitcoin mining took place in China, miners could take advantage of excess hydropower in Sichuan and Yunnan provinces during the rainy season, despite the abundance of coal.

So what can we do then? Is bitcoin doomed to get a bad rap in environmental, social and governance (ESG) circles forever?

Well, no, not exactly.

Zach Bradford is the CEO of CleanSpark, a Nasdaq-listed US company that uses renewable sources to mine bitcoin. This article is part of CoinDesk Mining Week series.

For starters, bitcoin is hot, but so is ESG. Large investors are more interested in BTC than ever. They also want to put their money in sustainable investments.

Not only are miners taking notice, but many want to be greener to attract the right kind of investors.

For new bitcoins to be minted, the energy has to come from somewhere. Many operations use energy from “dirty” sources, such as coal, gas and oil. The latest data from the Bitcoin Mining Council shows that the majority of the bitcoin mining industry uses a sustainable power mix – a trend that has already increased.

Read more: What does a crypto mining farm look like? Striking photos from Siberia to Spain

A growing number of mining companies are now using renewable sources, such as geothermal energy or solar energy, to power their operations. Sustainable bitcoin mining is growing: every operation in North America offsets at least some carbon emissions or actively tries to use more clean energy. Operations, like my company’s, that primarily use carbon-free sources are becoming more common.

We believe this trend will continue, because it just makes sense from a business perspective: Bitcoin miners will want the cheapest power sources available. And as clean energy becomes progressively cheaper, mining operations will help subsidize green projects.

Non-renewable energies are also becoming less attractive. In Kazakhstan, for example, the government has welcomed bitcoin miners with open arms – and subsidized fossil fuels. The government then quickly changed course when the energy grid became overloaded, forcing miners out of the country. The situation is similar in Iran, where a combination of US sanctions and illegal and unregulated mining has led the government to do an about-face to accommodate the industry.

But renewable energy can solve many of these problems: bitcoin mining will allow a faster return on investment from solar or wind energy projects, and they will arise in regions where they were not economically feasible before.

Not only is the bitcoin mining industry on the path to a low-carbon future, but it also already produces less carbon than equally energy-intensive industries, such as aluminum production, which emits up to 1 .1 billion tons of carbon dioxide emissions per year. .

Bitcoin’s other ESG selling point is that it also gives back energy solutions – a little-known fact is that bitcoin mining can actually boost a power grid. Not to mention job creation and investment in regions with limited economic development opportunities.

Read more: After Short-Lived Ban, Upstate New York City Still Relys on Crypto Miners

For starters, operations in North America have already found solutions to the kinds of problems that troubled Kazakhstan and Iran. On a cold weekend in January, New York miner Greenidge scaled back mining operations to supply all of its power generation capacity to New York’s independent system operator to help heat homes . He was able to do it in minutes. Prior to the start of its mining operations, the time from start-up to the facility’s maximum production capacity was approximately 14 hours.

And last month, Texas-based bitcoin miners helped the state by shutting down operations so the network could operate more efficiently before freezing weather.

Then there is the economic growth that mining brings with it. Our company, for example, announced in September a five-year, $145 million investment in Norcross, Georgia, the city where our newest data center is located. We will create more than 20 skilled and highly skilled jobs with an annual salary of approximately $50,000, and our investment in a $2 million power expansion with local utility Georgia Power is expected to benefit customers across the country. electricity and community members living near the data center.

Other examples include a miner helping his local fire department with a cash injection, landfill closure, and investment in once forgotten towns. If miners continue this trend across the United States, the social change will be phenomenal.

We got our start as an energy technology company; we were focused on sustainability before we started mining bitcoin. We see how other farms can leverage the way they farm to provide energy solutions. We believe mining companies will continue to integrate sustainability into their day-to-day operations.

Bitcoin has already started to disrupt the tech and finance landscapes as it becomes more mainstream. And just as ESG investing becomes the norm, bitcoin’s decision to help people around the world achieve financial freedom will be green and socially responsible.

Further Reading from CoinDesk Mining Week

Introducing CoinDesk Mining Week

Our reporters visited crypto mining farms around the world, interviewed key players and analyzed network data to shed light on a little-understood industry.

Don’t Call It a Comeback: The Unlikely Rise of Home-Based Bitcoin Mining

Even with the rise in popularity, home bitcoin mining is only a small slice of the overall industry pie.

Will Belarus Attract Crypto Miners Amid Sanctions And Russian-Ukrainian War?

Despite favorable trading conditions, a country’s political environment can deter international capital.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


Not all news on the site expresses the point of view of the site, but we transmit this news automatically and translate it through programmatic technology on the site and not from a human editor.
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