At the core of this short history lesson is the continued innovation that has taken place in order to keep winning the Bitcoin race. Having a better performing ASIC isn’t the only way to win at the race however—miners have also been innovating on the energy production side in order to reduce their cost to mine as much as possible.
After the boom of 2021, it was clear that Bitcoin was here to stay and a lot more money poured into the industry. In Texas, there are a number of solar powered mining centers that have sprung up. These centers are working with the local governments to make their electricity generation available to the grid.
The Texas electrical grid is also benefitting from a surge in Bitcoin mining as grid miners are investing in better materials and grid expansion to accommodate their power needs. This investment will benefit homeowners and businesses alike by reducing inefficiencies and making electrical power delivery more robust. The state is taking further steps to work with miners so that they may assist in times of crisis such as the winter of 2021 when Texas experienced multiple blackouts due to an ice storm. Solar power farms would be able to shift that power from Bitcoin mining to powering homes when traditional power stations freeze up, for example.
In fact, a recent 2021 study revealed that 58.5% of all Bitcoin mining happened using renewable energy. Due to the market price stability of green energy, miners are gravitating to it as a means to get control over their cost of goods sold in times of volatility. This is only helping to fuel investment and innovation into the green energy sector.
Miners are also innovating in areas where the business has all but died but the infrastructure remained. Bitcoin mining is ideal in such places as abandoned warehouses, factories and mills where large amounts of unused power capacity exists but is all but forgotten about. Restarting operations in those areas can lead to a revitalization of the local towns and municipalities by producing jobs, educating workers and generating tax revenue from a new and growing tech industry.
Innovation can happen in many different ways. There have been reports of Bitcoin miners in the US and abroad using waste heat from their machines to warm their pools, with one such idea being used to aid the public by providing a year round heated public access swimming pool. I, myself, once used the heat from my basement mining operation to warm my home through the winter.
Bitcoin mining isn’t the first time humans have “wasted energy” in pursuit of something crazy either. During the 1960's, space race, a considerable amount of fuel was used to get astronauts off the planet. One mission alone would use up to 3,500 tons of liquid oxygen and kerosene, all in an effort to do something many believed was impossible. Today we can see all the benefits “wasting” that energy brought us through such innovations as satellites, GPS, digital imaging, water filtration, and even memory foam. Who knows what innovations Bitcoin mining may bring about in 50 years!
This is where NY is short sighted in its attack on Bitcoin mining. Bitcoin is here to stay; it has been adopted as currency by some countries and is mined in almost every country in the world. In NY, The Greenidge Generation Power Plant recently restarted operations as a Bitcoin mine. This is a coal fire plant which means that it flies directly in the face of NY's push for greener energy production. In a move against the industry, Gov. Hochul passed a bill that required all new Bitcoin mining operations that leverage fossil fuels, to undergo an environmental review over a period of 18 months. By starting down the road of banning or limiting Bitcoin mining in NY, we are driving business in a nascent industry out of the state and into the arms of many other welcoming states where investment will draw talent and innovation to it and create the energy products of the future.