Canada’s largest cryptocurrency mining operator has indeed been threatened with power cuts. due to growing environmental concerns, hut 8’s bitcoin operation in medicine will be one of the first to go in the event of intense heat waves, cbc reports.
hut 8’s $100 million bitcoin mining farm, located in southeastern alberta, reportedly uses more than 10 times the electricity of any other facility (of any kind) in medicine hat, a city of 60,000 .
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employs 40 people and, in July, claimed to be the largest bitcoin mining company in Canada and the “largest publicly traded” operation of its kind in the world.
Residents and environmentalists have been so spooked by the power requirements of bitcoin mining that the city reportedly now has provisions to cut power to hut 8, should the need arise.
the threat of heat waves is no joke: in july, energy use in ontario reached the highest levels seen in years, as residents rushed to use their air conditioners to relieve record humidity levels .
Environmentalists campaigning against shack 8 argue that intensive use of electricity is frivolous and particularly harmful due to its reliance on fossil fuels. the electricity consumed by the miners in hut 8 does not come from renewable sources, which makes this a rather sensitive issue.
“[Hut 8] could have gone anywhere in the world and they chose the medicine hat,” medicine hat mayor Ted Clugston told CBC. “[hut 8] is not here for renewable energy because it is not reliable. [hut 8] needs gas generation and we have loads of it.”
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Despite its enormous cost, the Cabin 8 facility is really just a bunch of shipping containers on the outskirts of town. Fifty-six shipping containers house 180 servers that mine bitcoin non-stop.
The company reports that, including its secondary Canadian operations, it has mined more than 3,300 BTC (approximately $21.8 million) since last December. Hut 8 currently claims to be generating around 20 BTC ($132,000) per day through its medical hat facility.
misconceptions about bitcoin power usage
Unfortunately, the rest of the CBC report is riddled with misconceptions, parroted by Greenpeace spokesman Keith Stewart. he states that the way “the bitcoin [sic] algorithm works is that it is designed to waste as much electricity as possible. and the more popular bitcoin [sic] becomes, the more electricity it wastes.”
Not only is it wrong, but my head hurts. (hopefully) for the last time, here’s bitcoin evangelist and prolific speaker, andreas antonopolous on the topic of bitcoin and electricity use:
If the [bitcoin] system were 10 times bigger, with 10 times more users, it wouldn’t need 10 times more mining: what we have is enough. there’s a profit motive driving it, but it’s a mistake to think that if [bitcoin] just goes global, [the cost of energy] will also multiply, quite the opposite in fact.
Over time, the reward for mining [bitcoin] decreases, and as a result, we are more likely to see [the cost of energy] gradually decrease and level off.
yet, at least in this case, we have a major mining facility that relies on stable but harmful fossil fuels to power its lucrative bitcoin miners.
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It is certainly hard to argue that keeping the bitcoin network at peak performance is more important than life-saving critical infrastructure, especially in times of natural disasters like intense heat waves.
For what it’s worth: Antonopolous believes bitcoin’s heavy reliance on electricity consumption can help drive green energy innovation.
if that’s true, what better time for hut 8 to make the switch.
update 08:20 utc, sep 26: a spokesperson for hut 8 has since contacted hard fork to question the accuracy of cbc’s reporting.
in particular, he claims his $100 million drug shack mining facility only “makes up 20 to 30 percent of the city’s load at any given time,” despite the cbc report.
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“in the event of equipment failure, the load to shelter 8 would be reduced (not cut off), as is standard for any industrial power producer,” they clarified.
It should be noted that cbc has not yet made any corrections to their article.
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