Flared Methane Gas - Bitcoin Fixes This, Too
Yes - Bitcoin Can Be Environmentally Friendly
Say It Ain’t So - Bitcoin Can Help the Environment?
Yes, it seems that Bitcoin mining can not only be environmentally friendly, it can also reduce harmful methane emissions. That’s not the narrative you usually hear.
Methane gas emissions are eighty times more potent than carbon dioxide.
So why is this such a big deal? This is huge because of the massive amounts of gas emissions that are released into the air and wasted each year. It’s also important because of the potent, harmful nature of methane gas, referenced above.
What quantities are released? Studies estimate that 265 billion cubic meters of gas emissions are wasted yearly. That’s enough energy to power all Bitcoin operations ten times over!
An added benefit of Bitcoin miners producing energy is that it helps to smooth the flows of power to the grid. That is, in times of peak demand, when prices go higher, miners would sell power to the grid rather than absorb it in the mining operation. Conversely, when demand is low, miners can harness cheap power and be more profitable.
Tremendous opportunity exists for capturing this flared methane gas. Oil and gas drilling operations throw off massive amounts of wasted gas. Landfills constantly emit methane gases, as do agricultural operations.
Where Are Miners Capturing Methane Gases?
When China banned cryptocurrency mining last year, the miners picked and left. They went mainly to Kazakhstan, Russia and Texas. The total hashing power of the Bitcoin network dropped off initially, but has regained its earlier levels, and the network hasn’t missed a beat.
So far, Texas and North Dakota have been the hotbeds of capturing flared methane gas. West Texas is home to a lot of oil wells, each of which throws off natural gas used in the drilling process. The region holds the potential to host many Bitcoin mining operations.
Oil and gas behemoth Exxon Mobil has teamed up with Crusoe Energy Systems to used flared gas from a North Dakota drilling site to mine Bitcoin. It’s also considering similar projects with Crusoe in Alaska, Germany, Nigeria and other nations.
Crusoe has trademarked its strategy called the “Digital Flared Mitigation System,” which they hope will provide the lowest cost solution in the industry. They have some big money behind them as well. Bain Capital, Winklevoss Capital, and Valor Equity Partners have invested over $500 million in the effort.
The Positives are Everywhere
Climate activists can make the case that if crypto miners are using natural gases, then the world is not moving away from fossil fuels fast enough. However, given where we are now, capturing dangerous emissions is a net positive. As is mining with totally renewable energy sources.
Bitcoin mining has been moving toward the use of more and more sustainable sources for several years. Some estimates put the amount of mining done with renewable sources at 60-65%. As an industry, Bitcoin mining is increasing its renewables usage faster than any other industry.
The Bitcoin Mining Council referred to the industry as “one of the most sustainable industries globally.” They may not be totally impartial, but the numbers don’t lie.
White House Report on Mining Contains Positives
Even a White House report on crypto mining, called “Climate and Energy Implications of Crypto-Assets in the United States,” contained some positive statements on mining. The following phrases were in the report:
“Mining can be good for the environment.”
“Bitcoin mining has shown incredible progress.”
Though the report laments the massive quantity of energy used in mining, the authors seem to acknowledge that crypto is here to stay. It also indicates that regulators and legislators want to learn more about the mining process and the crypto industry.
It sounds bullish to me.
The topic has gotten a lot of attention recently, most notably on Twitter. Here’s a sampling of what’s out there:
This Month in Bitcoin History:
September 2012 - The Bitcoin Foundation was founded in September 2012 to promote bitcoin's development and uptake.
September 7, 2021 - The Legislative Assembly of El Salvador voted to make Bitcoin legal tender in El Salvador, the first nation to do so.
Recommended Bitcoin Tools, Platforms, Podcasts:
Gemini - My choice for buying and HODLing Bitcoin, rated tops for safety and security. User-friendly platform and phone app. Earn Bitcoin rewards as well with the Gemini Credit Card.
Arculus - The crypto hardware wallet from Arculus is one of the best products on the market for storing your coins. Very easy to set up and to use, and very affordable.
Lolli - The Lolli shopping app lets you earn great Bitcoin rewards on practically everything you buy, whether you’re shopping on your phone, computer, or in-person.
Twitter - Follow The Bitcoin Files on Twitter at @BitcoinNewslet1 for all of my articles, commentary and links to my contributions to Bitcoin Magazine.
Medium - Check out my writings on Medium, including articles not featured in the newsletter. Join my 550 other followers who read and write about crypto. medium.com/@rickmulvey
Podcasts - To hear the top names in Bitcoin, and learn more than you could imagine, check out The Pomp Podcast with Anthony Pompliano, What Bitcoin Did with Peter McCormack, and The Wolf of All Streets Podcast with Scott Melker.
Issue No. 74, September 16, 2022
Rick Mulvey is a CPA, crypto consultant, and frequent contributor to Bitcoin Magazine. He writes about all things Bitcoin, and yells at the Yankees and Giants. He also runs marathons and makes wine, neither professionally.