Square, a financial payments company, and Blockstream, a Bitcoin infrastructure firm, have announced a $5 million partnership to power crypto mining with solar power.
The project will be completely transparent, with the economics of the build-out including the operational costs and return on investment to be made open to the public. It is hoped that the project will be a catalyst for more mining operations to use renewable energy instead of sucking power from the grid.
There will be regular updates from the companies on the economics of the project, and a freely accessible public dashboard, including real-time metrics such as power output and the volume mined.
While it’s not the first renewable energy project to mine cryptocurrency, it will be the most transparent. The companies released a statement saying they hope it will inspire more renewable mining operations of this nature to be created.
“While we know that many mining operations throughout the world, including ours, already rely on renewable energy (as it is the most cost-effective power available), we hope that the open and transparent nature of this project will become a model that other businesses can learn from,” the statement said.
“We hope to show that a renewable mining facility in the real world is not only possible, but also prove empirically that Bitcoin accelerates the world toward a sustainable future,” Square said in a statement.
Why cryptocurrency is bad for the planet
The mining process for digital currency creates a massive burden on the planet due to the sheer volume of electricity resources required.
Computer graphical processing units (GPUs) are used to solve complex computational math problems, creating new digital coins that can be entered into circulation.
Effectively, this mining process maintains the ledger of transactions that digital currencies are based on, and people are rewarded for using their hardware.
As cryptocurrency becomes more popular and more coins go into circulation, the hardware requirements have skyrocketed, which means a heavy drain on energy networks.
Research has shown that Bitcoin emissions alone have increased by forty million tons in the last two years alone, highlighting why renewable solutions are essential.
The cryptocurrency that is aiming to save the planet
There are many different kinds of cryptocurrency – the major ones like Bitcoin and Ethereum, and a large variety of smaller, lesser-known currencies.
One of those smaller names recently shot to prominence when Tesla founder and chief executive Elon Musk spruiked Dogecoin on Twitter and promised to send it “to the moon”, figuratively and literally.
His Tweet sparked a significant surge in Dogecoin investment, followed by its inevitable crash. The same year that Dogecoin was founded, another unique currency was also created – SolarCoin. You cannot mine for this in the traditional way – to generate coins, you need to produce renewable energy, with owners of rooftop solar panels rewarded.