Cryptocurrency has the potential to revolutionize our monetary system. Bitcoin — the largest cryptocurrency — could provide people with a more secure, difficult to counterfeit, more streamlined, and decentralized financial system.
But as bullish as people are on Bitcoin, there’s been a difficult-to-ignore shadow looming over the industry.
“Bitcoin is one of the most exciting and fascinating technologies,” says John Belizaire, the CEO of Soluna Computing, which buys unused clean energy to sell to others who need it.
“But it has this detrimental side effect, or this bug” — the bug he’s referring to is Bitcoin’s energy consumption.
But there is potential to make this promising technology greener — and Lancium, a Texas-based database management company that designs smarter and greener data centers is looking to make Bitcoin greener in a big way. They’re building the single largest Bitcoin mine in North America — and Lancium says it will be the most sustainable, as well.
Watch the full episode on Lancium:
How much energy does Bitcoin use?
All cryptocurrency transactions — as well as the release of new coins into circulation — are recorded through a process called mining. This process requires many verified crypto miners to validate a transaction by solving incredibly difficult mathematical puzzles.
This acts as a way to verify all transactions in a decentralized manner — but, because Bitcoin mining requires a lot of computing power, it uses a decent amount of energy.
When the numbers hit the media, they were startling: Bitcoin’s energy consumption could be more than twice the amount of energy it took to mine copper or gold, researchers at the Oak Ridge Institute announced in 2018. Further studies out of Cambridge University found that the Bitcoin carbon footprint was on par with that of smaller countries like Argentina.
The questions around just how damaging Bitcoin energy consumption was to our chances of reversing climate change perhaps hit their peak around May 2021, when Elon Musk reversed his position on allowing customers to buy Teslas with the cryptocurrency, citing the Bitcoin carbon footprint as his reason.
Reducing Bitcoin energy consumption
Renewable energy can fit the bill when it comes to cheap electricity. But it is not necessarily the most efficient form of power yet.
“Renewable energy is the future,” says Michael McNamara, the CEO and co-founder of Lancium. And Lancium’s guiding principle is that the transition to greener power is going to happen faster than people think.
“Our increase in power consumption can have a carbon negative impact,” McNamara says, “by enabling more renewables faster, and retiring fossil plants faster as well.”
Lancium’s idea was to move power-hungry data centers away from the users, and to where the energy is at its source.
And that source is West Texas.
“It’s abundant with wind, and it’s abundant with solar,” says Shaun Connell, executive vice president of power for Lancium.
But, Connell says, there’s a problem: you can’t store wind and sunshine.
To help solve this problem, Lancium has begun to build and operate a set of massive data centers.
By pulling from the energy reserves created by renewable sources like wind and solar power when the power grid isn’t being used heavily, Lancium data centers ensure that the clean energy is not going to waste.
When the demand for power is high, the data centers do the opposite, throttling down their energy consumption. By using only renewable power smartly, the centers free themselves from some of the most costly and power-hungry needs of data centers, like HVAC cooling systems.
And they’re applying this whole approach to a new field: Bitcoin mining.
The mine monitors the current condition of the grid, explains Lancium co-founder and CTO Raymond Cline Jr. When it sees that there is more electricity being created than consumed, it can stabilize the grid by turning that extra electricity into Bitcoin energy consumption.
A Lancium mine’s Bitcoin energy consumption can be adjusted up or down within 16 seconds, helping to ensure the most efficient use of clean energy as possible.
That West Texas location provides another challenge, however; that scorching sun doesn’t just juice up the solar panels.
“When you’re doing that in West Texas, the biggest enemy of Bitcoin miners is heat,” says Bo Gibson, the co-founder of Digital Carpenters. To fight that heat, Digital Carpenters have outfitted the mine with immersion cooling technology.
“Right now, the standard in Bitcoin mining is air-cooled,” Digital Carpenters co-founder John Matthews says. Read: inefficient, energy-hungry fans surrounding the hard-computing miners.
Rather than fans, Digital Carpenters’ immersion cooling technology submerges the miner in a fluid — don’t worry, the fluid doesn’t conduct electricity. By allowing the cooling fluid to flow through the miners, they can keep the chips cool in a more efficient way.
“One of the most sustainable sites ever built”
Beneath the bright West Texas sun, the West Texas wind causing the American and Lone Star flags to dance, a line of ceremonial shovels stands in the sand. Fort Stockton is going to be the site of Lancium’s newest Bitcoin mine.
“It’ll be one of the largest single Bitcoin mines ever built,” McNamara tells a gathered crowd, with a focus on smoothing the path to widespread adoption of renewable energy.
“We think it will be one of the most sustainable sites ever built.”
Meet the digital currency disruptors who are making Bitcoin mining carbon negative for a greener future.