Category Archives: cryptocurrency mining

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Study Compares Mineral Mining to Crypto Mining

A recent scientific study by acclaimed journal Nature has compared cryptocurrency mining to mineral mining in terms of energy used for producing the same market value. The study provides interesting insight into this domain and shows how cryptocurrency mining is affecting the energy footprint in the world.

The study, conducted by Department of Energy scientists at the Oak Ridge Institute for Science and Education, compares major cryptocurrencies like Bitcoin, Ethereum, Monero and Litecoin to aluminum, copper, gold, platinum and rare metal oxides in the Earth’s crust.

According to the study, it reviewed the different mining systems from 1 January to 30 June 2018. It found that Bitcoin mining took 17 Megajoules (MJ) to USD 1 value. Ethereum and Monero used 7 and 14 MJ of energy respectively to create the same dollar value.

In comparison to the cryptocurrency mining figures, aluminum, gold, Copper, Platinum and rare earth metal oxides used 122, 4, 5, 7, and 9 MJ respectively for this purpose. In summary, all metals studied except for aluminum used less energy in their mining than Bitcoin.

An equal amount of energy (7 MJ) is required to mine the same dollar values for Litecoin, Ethereum and platinum. Copper and gold take a lot less in their mining efforts than any of these cryptocurrencies. Rare Earth oxides, valuable for electronics, also consume more energy than Litecoin and Ethereum mining.

The report also states that energy dedicated to cryptocurrency mining is expected to increase in the future, averaging today around 19 MJ compared to 17 MJ in 2016. The study also focuses on the carbon imprint of cryptocurrencies which has been criticized by clean energy experts because of miners’ tendencies to look for cheaper alternatives to fossil fuels for mining purposes.


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Montana County Postpones Bitcoin Mining Suspension

Missoula county of the US state Montana has postponed ruling on a decision as to whether Bitcoin mining initiatives should be shut down, as well as the banning of any new projects. The final decision will now be made in August.

A lack of information has been cited as the prominent reason behind this deferment, as reported by CoinDesk. A public hearing held by the Missoula County Commission concluded that the limited data available was not sufficient to address all of the concerns.

Jean Curtiss and Cola Rowley, both county commissioners, told local news outlet the Missoulian that at the time of the hearing the commission could not fully comprehend “all the impacts in the future or the long game.”

Those looking to ban the mining initiatives operating in the county cite concerns regarding large Bitcoin mining operations as an issue, as this could negatively impact local property values. As well as this, some residents fear excessive energy consumption could cause electricity rates to increase.

Those supporting the operations argue the farms create valuable jobs for local residents.

Previously predicted to be the next mining hub

Earlier this month the economist Brandon Bridge published an article predicting Montana to be the next Bitcoin mining haven.

Referencing Montana’s relatively low energy rates, a cold climate and lots of unused warehouse space, Bridge wrote:  “There’s a huge potential for locations and jurisdictions around the world that are favorable to the Bitcoin industry – most notably right here in Montana.

Just last year Montana become the first US state to issue public funding to Bitcoin mining operations in an attempt to increase state-wide rates of employment.

Washington state soon followed with similar legislation, but two counties have temporarily stopped accepting any new applicants for the funding due to a reported spike in electricity demands causing issues.


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Conditions of Eastern Siberia Appeal to Crypto Miners

The economic region of Russian Eastern Siberia is appealing to cryptocurrency miners, offering cheap electricity to enhance the already attractive features of a cool climate and close proximity to China that the area offers.

Cryptocurrency mining is a cost-intensive process, with electricity bills consuming a large chunk of profits, alongside equipment updates and space cooling systems. In Irkutsk, one of the largest cities in Eastern Siberia, consumers pay just one Russian ruble per KWh, the equivalent of USD 0.016. It currently requires approximately 20,000 KWh to mine one Bitcoin, totaling an energy expenditure of around USD 350 in Irkutsk.

Bitcoin is valued at USD 9,013 at the time of press, meaning that the costs lost on electricity is considerably lower than in places such as London, where a unit of Bitcoin consumes USD 3,650 of electricity to be mined. While commercial prices in Irkutsk can be relatively higher, it is still a far cheaper alternative than most other locations.

The cold climate of Eastern Siberia also provides a free alternative to cooling systems for ASIC units.

While the Chinese border lies just 1,500 km away, the close proximity economically benefits mining businesses that require new equipment on an annual basis. The location enables faster and cheaper delivery services, crucial for widescale mining projects that require the most up-to-date equipment to stay competitive.

These prime conditions are drawing in both local and international investors who are looking to enter the mining business.

Estonian Minery Global and Russian

As reported by local news outlet Interfax, Estonian Minery Global and Russian already have plans to institute five industrial complexes to the region in October to be utilized for cryptocurrency mining.

The two companies plan to locate the mining farms close to the IrkutskEnergo hydropower station, with a total project capacity of 55 MWH. All of the electricity will be provided by IrkutskEnergo via contracts with Bratsk Grid Co, with project plans indicating that the electricity costs will average at a price of USD 0.07 per KWh. Comparatively, the average cost of electricity in the US is USD 0.12 per KWh.

Final licenses and permits are still being pursued by project managers, with construction planned to begin in May once everything is approved. The companies are offering hosting services to any potential miners upon completion of the project.

It was recently reported that Georgia held the position as the second most active country for cryptocurrency mining, holding several similar attributes of Eastern Siberia including a cold winter climate and relatively cheap electricity costs.


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