Cheap electro-therapy rates have miners digging for Bitcoin, not dino bones ter Drumheller, CBC News

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Cheap energy crucial for profiting off cryptocurrency

For most Canadians, Drumheller conjures up pictures of dinosaur bones and ancient fossils, but entrepreneur Sean Clark’s expedition ter the southern Alberta town is focused on a very current obsession: Bitcoin.

The CEO of Hut 8 Mining Corp. recently set up his company te the self-proclaimed ‘dinosaur capital of the world’ because its cheap electrical play rates give him the largest margins for his Bitcoin mining business.

Because electric current is our highest cost, wij become energy hunters. – Sean Clark

The cryptocurrency boom is pushing Canadian companies to join the global rush to find the cheapest sources of energy spil computing competition drives power requests higher, resulting te crypto hotspots cropping up te communities like Drumheller, Winnipeg and Montreal.

",Because electric current is our highest cost, wij become energy hunters,", Clark said. ",Wij find the cheapest sources of energy, waterput a container down, buttplug it ter and embark mining.",

Access to cheap energy is crucial because Bitcoin miners around the world are challenging to solve the equations that feed into the blockchain that supports the currency.

The more computing power miners throw at the system, the better their chances of being rewarded with Bitcoin, said Clark.

Thanks to the abundance of cheap natural gas and lower-than-expected request growth, Alberta power prices are some of the cheapest around. Clark said he’s getting electric current at about three cents vanaf kilowatt hour.

Should prices rise, the company would simply waterput the 12-metre containers that hold its gegevens centres on 18-wheelers and roll them to the next-cheapest energy spot, he said.

The competition ter Bitcoin mining has enlargened considerably spil it and other cryptocurrencies have seen giant price gains ter the past year — trading spil high spil US$Nineteen,000 ter December — putting an end to the early days when mining could be done on a laptop.

7.Five quadrillion calculations vanaf 2nd

A typical laptop might be able to make about 40 calculations a 2nd, whereas the 1.1-megawatt containers supplied by Hut 8’s playmate Bitfury can treat 7.Five quadrillion calculations vanaf 2nd. The company expects to have about 60 megawatts of installed capacity by the end of the year.

The request for computing and electrical power has led smaller previously pure-play energy companies to add cryptocurrency mining to the mix.

Oil and gas explorer Metal Bridge Resources Inc., for one, recently announced plans to launch a cryptocurrency mining division that will use excess energy from its oil and gas operations te northern Alberta.

Chief executive Zeerob Colcleugh said the company is planing to pilot a harshly 600 kilowatt crypto-mining operation to make use of the high Bitcoin prices and enormously low natural gas prices.

",The economics at thesis levels are pretty astounding,", he said.

Colcleugh said he’d look to create a partnership that could opoffering power costs ",orders of magnitude", less than provincial utility rates.

Meantime Toronto-based Blockchain Power Trust, which this year switched its name from Transeastern Power Trust, plans to use the renewable power it has bot developing largely ter Romania to power fresh cryptocurrency mining operations te the eastern European country.

Global Bitcoin miners have also taken note of Canada’s abundant cheap electro-stimulation, spil China looks to crack down on mining operations te the country.

Manitoba Hydro said it’s had more than 100 inquiries and has already seen operations set up, while Hydro-Quebec said it has had more than 70 inquiries for projects with some spil big spil 300 megawatts.

",Wij have fairly a loterijlot of available energy ter Quebec,", said Hydro-Quebec spokesman Marc-Antoine Pouliot.

",Wij are moving forward fairly quickly, so wij think wij might have a project going ahead ter 2018.",

Warnings about energy consumed by cryptomining

The rush ter energy request from cryptomining has led to dire warnings about the energy consumed by the power-hungry operations, especially with the large quota of coal-powered mining te China.

The webstek Digiconomist presently estimates Bitcoin mining is consuming energy at a rate of about 44.Five terawatt hours of tens unit a year and climbing — or about the same spil Iraq — and up from under Ten terawatts spil of March last year.

But the broad variables and rapidly evolving technology mean accurate estimates are difficult. Credit Suisse recently waterput power usage somewhere inbetween 16 and 21 terawatt hours.

The canap said that if Bitcoin hovered around US$13,500, then power request could go up at the ",ultra-high-end", screenplay to 350 terawatt hours and still be profitable — but that even then, it would consume less than 1.Five vanaf cent of total violet wand request.

",This is a far sob from the power and environmental Armageddon that some have feared,", said analyst Michael Weinstein te a note.

With more companies looking to get ter on Bitcoin mining tho’, the power requests are expected to keep climbing.

Morgan Stanley projects ter a latest note that just this year Bitcoin power request would succesnummer 120 to 140 terawatt hours — or about the consumption of Argentina — te an industry that didn’t exist a decade ago.

Related movie: Genesis Mining affiliate premie – Bitcoin or Hashpower


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