You’ve probably heard how much energy cryptocurrency mining uses and how harmful that is to the environment.
The fact that Bitcoin miners are now buying entire power plants to profit from the speculative asset should be quite concerning.
An American company called Stronghold Digital Mining operates a Bitcoin mining operation at the Scrubgrass power plant in Venango County, Pennsylvania, which it acquired over the summer, in 2021.
In order to open Stronghold’s Bitcoin mining power plant, the company raised $105 million. Currently, the plant burns coal waste to produce enough electricity to power 1,800 mining computers.
In order to run its Bitcoin mining operation, Stronghold Digital Mining burns 600,000 tons of coal waste at Scrubgrass each year. According to Stronghold’s filings with the SEC, the company plans to go public.
It gets worse. Stronghold plans to expand its coal-fired power plant operations.
The company acquired a second power plant in Pennsylvania, called Panther Creek power plant, in August. Now it is looking to expand to a third plant.
To solve advanced mathematical equations, Bitcoin mining requires powerful computer processors. The blockchain is a digital ledger that helps maintain the cryptocurrency’s digital ledger. Bitcoin miners receive cryptocurrency in exchange for solving these math problems.
The more computing power one has, the more equations they are able to solve and the more bitcoin they earn. Due to the intense nature of the process, individuals cannot earn Bitcoin with the computer power they already possess. To mine Bitcoin, miners invest thousands upon thousands of dollars in equipment. Nonetheless, only these multi-million dollar operations can mine enough bitcoin to make the process profitable.
According to the University of Cambridge’s bitcoin electricity consumption index, bitcoin miners are predicted to consume 130 Terawatt-hours (TWh). TechCrunch points out that Bitcoin’s carbon dioxide emissions are similar to those of a country like Jordan, with a population of 10 million.
In addition, taxpayers are funding Stronghold Digital Mining’s Bitcoin power plant profits.
Bloomberg reports that Pennsylvania provides tax credits for burning coal waste. Stronghold calculates that each bitcoin it earns through mining costs the company under $3,000.
Bitcoin was trading at more than $42,000 when this piece was published, not bad for a taxpayer-subsidized cryptocurrency mining operation that’s destroying the environment.