Bitcoin “mining” has about as much to do with real-world mining as a Hollywood avatar has to do with an actual human being – except that it consumes inordinate amounts of real world electricity.
“Mining” is the energy-intensive process which both creates new coins and maintains a log of all transactions of existing digital tokens. This involves putting together huge amounts of computing power to solve computer-generated mathematical puzzles, which in turn is how you get bitcoin in return – thus, “mining.”
According to CNBC, bitcoin “mining” consumes a total of 116 terawatt-hours of electricity per year, 0.5% of the world total. If it were a country, that would be #33 in the world – consuming more electricity than the Netherlands or Philippines. That much electricity, which is currently being totally wasted from the standpoint of physical economy, is 10% or more of what would be needed to provide power to thousands of new hospitals that have to be built across the developing sector as part of a world health plan to defeat the COVID pandemic.
It’s estimated that 65%-75% of all of the world’s bitcoin “mining” activity has been going on in China, because there is cheap, largely coal-based electricity. With China cracking down, large numbers of “miners” are planning to relocate to… Texas! Says CNBC: “Texas is an ideal destination for miners, thanks to its abundance of solar and wind power, its unregulated market, and its crypto-friendly political stance.” Brandon Arvanaghi, previously a security engineer at crypto exchange Gemini, said: “You are going to see a dramatic shift over the next few months. We have governors like Greg Abbott in Texas who are promoting mining. It is going to become a real industry in the United States, which is going to be incredible.”
CNBC does, however, take passing note at the end of their long article on the matter, that “perhaps the biggest question is the reliability of the Texas power grid.”
You don’t say. To call all of this psychotic, is too generous.