Tesla to provide solar and energy storage tech for more sustainable bitcoin mining
Blockchain company Blockstream Corp has announced a partnership with payments firm Block and Tesla, to create a solar-powered bitcoin mining facility in the US.
The environmental impact of cryptocurrency mining has been widely questioned in recent months, as the sector continues to grow exponentially. Mining requires high-powered computers capable of solving complex mathematical equations. According to experts at the University of Cambridge, global bitcoin mining operations now consume more energy annually than Norway and Ukraine combined.
As an energy-intensive process, bitcoin mining adds pressure to the grid when undertaken at scale. Moreover, it often happens in locations where the electricity mix is high-carbon, with China and the US being the two largest global markets.
In a bid to help prove the viability of running mining operations on renewable electricity, Tesla, Block and Blockstream will collaborate to build an open-source, solar-powered bitcoin mining facility in Texas, Blockstream’s chief executive Adam Back confirmed late last week.
Back stated that Tesla’s role in the project will be the provision of solar panels, Megapack batteries for energy storage, and related infrastructure.
“This is a step to proving our thesis that bitcoin mining can fund zero-emission power infrastructure and build economic growth in the future,” said Back.
The facility is due to begin operations later this year and will have a total capacity of 3.8MW in the first instance.
Tesla notably purchased a $1.5bn stake in bitcoin last year and its chief executive, Elon Musk, is reportedly continuing to explore the possibility of accepting customer payments in cryptocurrency form.
It bears noting that some geographies with a high portion of renewables in the electricity mix, including Iceland and Sweden, are not welcoming bitcoin mining hubs.
As well as shifting to renewable energy, a potential way to minimize the environmental impact of bitcoin mining is to shift from a proof-of-work (PoW) protocol to a proof-of-stake (PoS) approach. PoW menchanisms . Both PoW and PoS are algorithms that help blockchains remain secure and validate transactions in the absence of banks and regulators, but PoS is far more energy-efficient, and competition is not determined purely by which computers are most powerful.
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