bitcoin hit one trillion dollars market
cap this year this has inspired some
bitcoin operations to expand especially
in the wake of the recent government
crackdown of miners in china
the ban on mining in china has caused a
mass exodus to the united states to
russia and to any other areas where
mining facilities are available welcome
to rockdale texas america's new crypto
mining hub this building that's directly
behind me inside of the buildings we
have this shelving that's a thousand
feet long 20 feet tall and there are
just minor after minor after minor
afterminer
we went inside north america's largest
bitcoin mine to understand how it works
and its energy footprint
what is a miner it is a small computer
they call it an asic miner it is made to
solve problems and when they solve that
problem it feeds into the bitcoin
network when it feeds into the bitcoin
network you receive a reward to help us
understand crypto's reward system a
little better we spoke to blockchain
expert bettina warburg that's what
mining is it's a process by which people
are contributing computing power and
earning a reward for essentially
participating in this process that
secures a network everybody's using the
same software that allows them to
connect together and participate in a
governance structure that's shared it
seemed like only yesterday that one
person with a handful of computers
crunching numbers in their apartment
could make money from mining bitcoin so
how do we go from there to here
just like with many industries you start
small the guy in the garage started the
process he mined bitcoin i believe the
reward was around 50 bitcoin for every
block reward now it is at 6.25 in some
ways cost equals energy expenditure this
is just the nature of technology we see
updates and innovation and people
driving margin and driving their cost of
operation down in order to reap the
greatest reward so you get mining
operations that happen
in places where power is less expensive
typically mining operations go where
energy is cheap
right now texas has some of the lowest
kilowatt hour prices in america that's
due in part to a deregulated energy
market which means several providers
compete to snag big customers like
windstone
there's environments like iceland russia
china canada areas like iceland and
canada have a cooler environment there's
probably less dust in those areas the
miners run at a cooler temperature
cryptocurrency is about the low-cost
provider texas is becoming a hotbed for
other
cryptocurrency facilities in fact
shenzhen based bitmining is coming to
texas
and beijing based bitmain a company that
designs circuit chips for bitcoin mining
is moving into the decaying aluminum
plant down the road from windstone
according to the oak ridge institute for
science and education one dollars worth
of bitcoin takes 17 megajoules of energy
to mine that's more than double the
amount of energy it took back in the day
to mine one dollars worth of copper gold
and platinum
the machines require more power and more
power requires larger capacity bigger
transformers higher voltage ultimately
the energy intensiveness comes from the
fact that solving these mathematical
puzzles is challenging and you have to
expend a certain amount of compute power
against it to be the fastest one to
actually solve the puzzle and putting as
much computational energy into that
challenge as possible increases your
ability to actually win it's
intentionally inefficient
each building is a hundred megawatts for
each 100 megawatt building you can fit
30 000 new asic miners in it in a
bitcoin mine the consumption is
basically taken by the miners each miner
has about 3 000 watts that it's pulling
an older miner an older generation the
s9 which was released in september 2017
was only pulling 13.50 the miners now
are at 3 000. so at capacity this
facility will have 750 megawatts of
electricity flowing through it enough to
power 150 000 texas homes during peak
demand that's a lot of juice
how do they manage to keep all those
miners cool our ideal goal is to keep
the ambient temperature
around 81 degrees there's a lake about a
mile from here and so underground we
have a 8-inch line with a thousand gpm
pump where we pump literally the water
through this mile long pipe into the
facility and it actually goes into
holding tanks that then recirculate the
water and it pumps it back into these
evaporative cooling walls that are 12
feet tall water is actually dripping
down the wall of that evaporative
cooling cell and then as the air comes
through it it actually cools from 16 to
20 degrees difference between the front
of the wall and the inside of the wall
the miners have fans they have intake
fans and there's thousands of those fans
running and they actually suck control
the ambient air through the miner and
then there's an exhaust fan actually
pushes the air through the chips and
into the heat aisle as it goes through
the miner it then heats up because the
chips that's a processing so it gets
really hot and then we capture the heat
on the inside of the heat wall and then
it is evacuated out of the building
through a quote-unquote chimney-like
environment inside the heat aisle it
literally feels like an oven
one windstone employee estimates that it
can get as hot as 140 degrees fahrenheit
in here
so the s9 has a hash rate of 13.5
terahash the new s19s are 110 tara hash
hashrate measures how many computations
a miner can do usually in a second so
how much money can each miner
potentially make each day currently a
s19 with 110 tara hash the profitability
every day for one machine is 30 usd
okay so 30 bucks times 30 000 miners
times two big buildings
nearly two million dollars a day for a
facility this size we have a full staff
of 120 employees we work 24 hours a day
three shifts there are definitely some
increased efficiencies on the horizon
such as faster processing chips for the
miners cooling them in immersion
technology but at approximately 73
terawatt hours annually bitcoin's energy
consumption is more than the energy it
takes to run every single television set
in america i think ultimately
the energy consumption question is a bit
of a what is it relative to when we look
at our financial system as a whole or
even just wall street to power wall
street which runs almost entirely off of
computation today anyway and high
frequency trading algorithms when you
look at mining just to earn bitcoin well
that's not necessarily so awesome
according to the digiconomist's bitcoin
energy consumption index one bitcoin
transaction takes more than 1500
kilowatt hours to complete that's more
than 50 days of power for the average
u.s household
bitcoin is
what i like to think of as a calculator
so it's a sort of old-school
very clunky system that gets the job
done and you look at what's happened
with newer blockchains like ethereum two
and dfinity is that they've actually
implemented a totally different
system
for
essentially doing the same thing and
ethereum is upgrading to more energy
efficient way of securing the network
and the future will be about a lot of
these different internet computers
battling it out for adoption so you'll
see dfinity near flow polka dot all
kinds of networks really uh
serving as the optimized internet
computers ultimately
the value will come from the amount of
applications and
tools and things that you can build and
do on top of
this computing architecture you know i
think all technology
creates energy consumption in certain
patterns and ultimately what we have to
do is make sure that what we're
building is something that's worthwhile
and that we actually want in our society