Category Archives: cryptocurrency mining

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Study: Over 74% of Bitcoin Mining is Powered by Renewable Energy

Bitcoin Mining

CoinShares – a crypto investment product and research company – has made a conservative estimate in its semi-annual report published on 5 June 2019, that renewable energy is used to power 74.1% of the global Bitcoin mining. This report also highlighted that the mining operations of the Bitcoin are conducted in areas with high sources of renewable energy.  

For instance, a company which designs ASIC chips for Bitcoin mining, Bitmain, is planning to install 0.2 million units of mining equipment in China to utilize the cheap hydro-electric power available in the country. Despite this supposedly good news, the report adds,

“The renewable estimate is down from 77.8% in our November 2018 report and reflects increased visibility of the industry in our part as well as movements within the industry.”

The hashrate has also witnessed an increase of 25%, from 50 EH/s (quintillion hashes per second) to 40 EH/s (compared to November 2018). This implies that during this timeline, the growth of the computing power required to maintain the network was slower than the previous decade’s average, although it was in line with the five-year average.

The hashrate recently grew, and according to CoinShares, this increase is mainly because of the high prices causing the mining hardware to be profitable, but also due to the use of ASICs (Application Specific Integrated Circuits).

In a previous report published by CoinTelegraph, the public mining company Hut 8 incurred losses of around USD 140 million and made only USD 50 million in revenue. This seems to be a substantial negative net loss, but the company’s COO, Andrew Kiguel, explained that they are hoping that with the recent surge in the prices of Bitcoin, the margins of the company will also improve.

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Bear Market Hits Hard at Mining Arm of GMO Internet Inc.

In a document released yesterday by Japan-based internet corporation GMO Internet Inc., the internet giant reported a financial loss of JPY 35.5 billion in Q4 2018 alone leading to the unsustainability of its cryptocurrency mining business.

The company described the loss as an “extraordinary loss” during a meeting of its Board of Directors. It would seem the market conditions of 2018 had a huge impact on the economics of the company, as it said that the profitability of the in-house mining business of GMO Internet Group decreased in tandem with the price decline in cryptocurrencies.

According to the document, the in-house mining on the consolidated account had an impaired loss of JPY 11.5 billion while the development, manufacture, and sales of mining machines returned a loss of JPY 24 billion.

The company recognized an intense competition in the “mining machine market” due to cryptocurrency price dip, as well as miners turning to second-hand sale/purchase of mining rigs, ultimately leading to cheaper hardware.
As for the in-house mining which was set up in December 2017, operations have not been favorable with expectations cut short due to the rise of the global hash rate.

On the basis of the current financial situation of the company, it has therefore decided to cease the manufacture and sale of mining rigs, while it moves its in-house mining operations to another location with cleaner and less expensive power supply.

In a follow-up Q&A document compiled during a conference with institutional investors, when asked about the outlook for 2019, the company responded that “GMO Internet will review the revenue structure of its in-house mining business, and continue running mining operations with the GMO Internet as a headquarter,” the document reads.

The company has also announced that sale of shares from its subsidiaries “GMO Financial Holdings (September 25, 2018) and GMO Payment Gateway (December 17, 2018)” increased significantly and that it was not reported as a consolidated gain.

The downward trend in cryptocurrency market this year has taken a toll on many crypto-related industries and GMO happens to be another victim of the prolonged bear market.

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New Russian Data Center Redstone Offers Fixed Electricity for A Decade


A new mining center based in Russia called Redstone is nearing completion of construction. Operations of the estimated 50MW center begin in June of next year, with phase 1 of the Redstone site will be ready for move-in beginning in May, however, and the data center is already accepting client applications.

Strategic Location

The mining center is expected to be a hit with miners from China and Russia, as well as all over the globe. Being close to the Chinese border and Manchuria’s airport allows this center to tap into one of the largest bitcoin markets in the world: China. Located in the Russian city of Krasnokamensk, the center will benefit from cheap electricity, accessible water for cooling, as well as an annual average temperature of 2 degrees Celsius that will help contribute to keeping equipment cool.

Another competitive advantage this data center will have over others is the capacity to generate its own power due to their own off-the-grid generator. Redstone is located right next to a coal power planet ran by Rosatom, a partner of the project. High-speed internet connection will be provided by Rostelecom, the largest digital services provider in Russia.


Along with this. construction of the site will be overseen by company Telecor, a massive Russian engineering company. In the last decade and a half alone, the company has completed over 500 projects in related industries such as engineering, automation, and IT.

Prices and the Future

Not only are potential clients able to request allocation of equipment already, but Redstone is already quoting an affordable flat rate fee of 5 cents per Kilowatt hour up to 5MW, or 10% of the data center’s capacity. Redstone also is willing to negotiate special rates for clients requiring more than 5MW.  Bitcoin miners will be relieved to hear that these prices are locked in for the next ten years, due to long-term contacts Redstone has in place that keep electricity costs fixed.

CEO of Telecor, Andrew Chernoknizhnikov had these words to say about fixed service prices:

“Amid predictions about constant increase in electricity prices, Telecor is able to fix service prices provided at Redstone for the next ten years, it is an important and valuable benefit for our customers.”

Horror stories of miners being forced to relocate due to new legislation that rescinds once eligible miners for cheap electricity are becoming more common as regulatory bodies around the world are cracking down on cryptocurrency mining. Miners do not need to fear for the next decade at least with this Russian based location. Andrew continues:

“Due to low costs and own energy generation at Redstone, which are for sure some of the most important benefits of this site, our company could offer very low prices, probably the lowest, not only in Russia but throughout the world.”

Russia is excited for the economic implications the construction of this data center will have for the country, attracting a number of jobs required to operate the data center as well as an influx of international talent and revenue.

For more information regarding the data center or to send in your own application, check out Redstone’s Website here: on Twitter: @bitcoinnewscom

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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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