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- 1 A number of factors have forced the mining companies to adopt alternative energy sources.
- 2 The early adopters gained very promising results from switching power sources.
- 3 Many leaders of these companies have expressed their views on this adoption.
The tree huggers and crypto critics have always criticized the Bitcoin mining activity for its energy consumption. By all accounts, it surely guzzles a lot of power to generate precious digital assets. Moreover, the crypto industry has seen quite a few discouraging incidents lately. They are making mining more expensive and forcing the miners to look for alternate ways.
What is Turning the Tides for Crypto Miners?
In the year 2021, most people were quite hopeful about the success of crypto. After all, the pandemic brought the whole world to a standstill. Governments were seeking alternative methods for making payments and for a solution to support economies as well. Crypto had a fair chance to emerge as a savior amidst all. As a result, mining companies took massive loans to kickstart or expand their operations.
But things started going south with the collapse of FTX and Celsius. Many of these companies went bankrupt or stalled their operations. Shortly afterward, the downtrend began as a double whammy for many crypto entities. Mining companies had no option but to switch to cut down on their expenses. The best way to incorporate that was to adopt cost-effective energy resources.
Thus, many miners did the same and the results were rather impressive. It enabled them to decrease costs, ensure profits, and reduce the carbon footprint in some cases.
What The Miners Think About This Switch?
Most companies have reported positive results with this adoption. The managing director of Swan Bitcoin, a Bitcoin-based service company confirmed it. He said that the average rate to mine cryptocurrencies has drastically come down. Earlier, the companies spent around $26,000 on a single Bitcoin. But with renewable energy sources, it takes between $5000 to $15,000.
Riot Blockchain, a publicly traded mining company, also said the same thing. The company has recently started using wind and solar energy. It registered that the price of generating a single Bitcoin has now come down to $8,389. Kent Halliburton, the COO of Sazmining, a hosted BTC mining provider agreed upon the same. He stated that electricity was the biggest expense for the mining companies.
Halliburton further emphasized that if the mining industry totally runs on renewable power, it can become a sustainable domain very soon. As per some sources, 59% of the mining operations are now carbon-free. More importantly, they are growing at a rate of nearly 4.5% per year. Moreover, he said all of Sazmining’s mining plants in Paraguay and Wisconsin are utilizing hydroelectricity.
Upshot
Besides the cost, using renewable energy makes the operations fit for the long term. Since the world is going on an eco-friendly living spree, it won’t take too long for the governments to train their guns on power-intensive mining. Therefore, it is the best move for mining companies to switch to renewable energy. The step can be difficult as sustainable power is not abundantly available.
While that’s a discussion for another time, it’s good to know that miners are keen to go green.
Nancy J. Allen is a crypto enthusiast, with a major in macroeconomics and minor in business statistics. She believes that cryptocurrencies inspire people to be their own banks, and step aside from traditional monetary exchange systems. She is also intrigued by blockchain technology and its functioning. She frequently researches, and posts content on the top altcoins, their theoretical working principles and technical price predictions.
