Crypto goes green: exploring eco-mining

by Eloisa Marchesoni

Around 17 megajoules (mj) of energy is needed to extract a dollar of Bitcoin, against the 4, 5 and 7mj respectively required for copper, gold and platinum. In the crosshairs of the studies proving this extreme energy waste are also the other cryptocurrencies: 7 mj to extract a dollar of Ethereum, 14mj for Monero. The only real metal that the cryptocurrencies do not exceed, in terms of energy required, is aluminum, with 122mj of energy needed to extract a dollar’s worth.

In the past, studies have been carried out to measure the amount of electricity consumed to power the cryptocurrency network, but all have focused on the analysis of the size of the network in an aggregate way: in November 2017, an estimate has equaled the energy consumption of the network to that of Ireland; another noted that it produced the same annual carbon emissions of one million transatlantic flights. The new document, however, is the first to examine the cost of energy per dollar, stating that “the comparison is made to quantify and contextualize the decentralized energy demand that requires the extraction of these cryptocurrencies and encourage the debate on how much these energy demands are sustainable and appropriate”.

The “cryptocurrency miners”, in fact, extract virtual currency through hardware that works continuously, performing mathematical calculations, and which involves a considerable energy expenditure, often not convenient for the individual operator. Added to this is the fact that this energy accounting depends very much on the country of origin of the miners. In fact, researchers have also tried to justify the geographical dispersion of bitcoin miners, explaining that any cryptocurrency produced in China would generate four times the amount of CO2 compared to the amount generated in Canada, and that the environmental impact of cryptocurrencies will vary not only with their market value, but also with the adoption of new technologies.

An innovative solution to this problem may be emerging from Moldova, a country in which ICT is a cutting-edge field and where renewable energy is increasingly gaining ground. In fact, Consulcesi Tech has built the largest photovoltaic system in the country, thus creating a 100% sustainable building which will be used as a mining farm, entirely feeding on solar energy. The capital Chisinau and more precisely the Academy of Sciences, houses this structure that includes over 3,000 photovoltaic panels. Sustainability and technology go hand in hand: the plant for the green mining farm will in fact be able to save 550 tons of CO2 and 240 toe (tons of oil equivalent) each year. A good idea, considering that the figures are huge: according to Morgan Stanley, the worldwide demand for cryptocurrency mining activities is currently equal to about 22 terawatt hours (TWh) and will grow dramatically, thus leading to an increase in consumption in 2018 at 125-140 TWh, or about 0.6% of world consumption.

The company Consulcesi Tech was supported by the government of Moldova in the construction of the plant, which was taken care of by the Fly Ren Energy Company, an Italian company specialized in generating electricity from solar sources. In January 2018, the Moldovan Council of Ministers presented measures aimed at amending certain laws to promote the use of renewable energy so that there would be harmonization between the Moldovan and European legislation.

Finally, therefore, we can talk about the existence of eco-mining, since the IT process on which the creation of new cryptocurrencies is based has been proved to have an energetically sustainable alternative. To think of a future in which virtual currencies could dominate, the solution offered by the Moldovan company could enlighten many other opportunities for cryptocurrencies.