Bitcoin Mining Becoming Fashionable Again as Green Impact Lessens — Major Mining Companies Boost Output

• Lower energy costs and more efficient mining strategies have boosted the output of Bitcoin miners.
• Compared to the previous month, Marathon Digital and Riot Platforms increased their BTC output in September by 16% and 9%, respectively. 
• Bitcoin mining is getting a green rebranding.

Leveraging cheaper energy prices and more efficient electricity usage, some of the world’s largest Bitcoin mining companies—including Marathon Digital and Riot Platforms—ramped up their capacity in September.

In a sector that accusations of environmentally harmful practices have long plagued, the same efficiency gains that are boosting miners’ profitability could also create a path toward carbon-neutral BTC mining.

Marathon, Riot, and CleanSpark Ramp up Bitcoin Mining

In the month of September, Marathon mined 1,242 Bitcoin, a 16% increase from the previous month. Meanwhile, Riot’s Bitcoin output rose 9% to 355. 

Even bitcoin miners who turned down their mining efforts in September have reported soaring output levels compared to last year.

CleanSpark’s Bitcoin production declined 2.5% in September from 659 to 643. However, the firm closed the financial year, having mined 84% more Bitcoin than in the previous year.

Boasting that “we had our best quarter and best fiscal year ever,” CleanSpark CEO Zach Bradford remarked that “our efficiency is up [and] our energy costs are among the best in the industry.”

Efficiency Gains Help Profits Soar

As Bradford implied, there are two key factors behind the recent surge in mining capacity.

On the one hand,  the cost of electricity has fallen in many places around the world, driven by lower fossil fuel prices and growth in the renewable energy sector. On the other, miners have become smarter in how they use the electricity they do pay for. 

When it comes to increasing energy efficiency, advances in mining technology are gradually bringing down the joules per terrahash (J/TH) of energy required for mining.

For example, Marathon noted that “September saw marked improvement due to decreased curtailment and optimization efforts that included upgrading equipment, leveraging our proprietary firmware, and other technical improvements.”

Miners Sync With Local  Demand

With renewable energy a growing source of electricity around the world, Bitcoin mining is helping electricity providers adapt to the less predictable output of the emergent infrastructure.

Unlike fossil fuel or nuclear electricity generation, wind and solar power can’t simply be ramped up or down to match peaks and troughs in demand.

Bitcoin miners like Riot are increasingly acting like a kind of electricity sponge, soaking up excess power when demand is low and winding back their consumption when demand is high.

For example, in September, Riot Platforms increased its BTC production by partnering with the Texas grid to modulate its electricity usage according to demand.

Through a contract with its electricity provider, Riot receives “power curtailment credits,” allowing it to sell pre-purchased power energy to the grid at market-driven spot prices.

As the firm’s CEO Jason Les explained : “When coupled with our ability to be a flexible user of power, Riot’s sizeable long-term, fixed-price power contracts represent a differentiated advantage for the Company, while simultaneously making electrical capacity available to the grid when it is most needed.”

Bitcoin Mining Gets a Green Rebranding

As a result of efficiency gains and more optimized electricity usage, Bitcoin mining is starting to shed its reputation for high carbon emissions.

For example, recent research found that total emissions from the sector were significantly lower than those observed in the fashion, tourism, and gold mining industries. 

Meanwhile, the Cambridge Bitcoin Electricity Consumption Index (CBECI) recently updated its methodology to account for newer, more energy-efficient mining rigs.

The result? Carbon emissions from Bitcoin mining are likely to be lower than originally thought. In fact, with miners increasingly emphasizing renewable energy, some analysts estimate that as much as half of all the electricity used by the Bitcoin mining sector now comes from clean energy sources.