Sustainable Crypto Mining

Have you ever wondered how cryptocurrency works? Crypto mining, is a challenging system based on hash rates, a race to crack codes and math. So, stop right there if you're picturing a typical mine...It's more the enormous expanses of computing equipment in data centres which crypto mine farms resemble.

So, Bitcoin...

A cryptocurrency, such as Bitcoin (BTC), eliminates the need for third parties to be involved in financial transactions by acting as money and a means of payment regardless of any one individual, group, or entity.

An unidentified creator or group of developers going by the name Satoshi Nakamoto released Bitcoin to the world in 2009. Bitcoin and its ledger are secured by proof-of-work (PoW) consensus, which is also the "mining" process that introduces new bitcoins into the system.

How and Why Do We Mine Bitcoin?

Bitcoin mining is the process of creating new bitcoins by solving extremely complicated math problems that verify transactions in the currency. When a bitcoin is successfully mined, the miner receives a predetermined amount of bitcoin. It makes sense that interest in mining has increased given the recent skyrocketing prices of cryptocurrencies in general and Bitcoin in particular. However, the complexity and expensive expenses of bitcoin mining make it a poor investment for most individuals.

Bitcoin mining can be done using a wide range of hardware and software. With a personal computer, it was possible to mine Bitcoin competitively when it first came out; however, as it gained popularity, more miners joined the network, decreasing the likelihood of being the one to solve the hash. If your computer has newer hardware, you can still use it to mine, but your odds of successfully solving a hash are extremely slim.

Cryptocurrency mining has, however, come under fire for the environmental harm it does as the globe grows increasingly enamoured with Bitcoin due to the high computational power needed.

The Cambridge Bitcoin Electricity Composition Index has estimated that Bitcoin mining regularly uses roughly 11 GW of electricity on average. Although it can be different, that seems like a lot of energy for Bitcoin mining.

Why Does Bitcoin have Such a High Energy Consumption?

The primary culprit is the Proof-of-Work consensus mechanism, which is an ineffective mining system (PoW). Bitcoin needs computers devoted to cryptocurrency mining to tackle increasingly difficult mathematical problems in order to verify transactions inside its decentralised framework. Many miners compete against one another in real time to see who can validate a transaction first and earn bitcoins as payment.

These mathematical puzzles naturally become increasingly difficult as more people try to answer them, necessitating a higher investment of electrical and processing resources on the part of the miners in order to reap the rewards. The hundreds of thousands of computers that don't win the competition use energy that is entirely squandered.

Sustainable Bitcoin Protocol Seeks to Clean up Mining

To offset this, the start-up Sustainable Bitcoin Protocol – headquartered in New York – has created what it terms a Sustainable Bitcoin Certificate (SBC), a tokenised product “that captures the value of bitcoin mined using clean energy.” 

The certificates will be offered to institutional investors, who will hold them alongside bitcoin to make sure their assets are in line with their environmental objectives and climate-positive.

Three steps are used to develop SBCs: using renewable energy sources like hydro, solar, and wind; supporting renewable energy financially by purchasing and retiring Energy Attribute Certificates; and using CO2 reduction technology.

Bitcoin miners must submit to an audit of their energy utilisation by a third party in order to receive an SBC.

One of the more well-known sustainable Bitcoin miners in the United States, CleanSpark , executed the first Sustainable Bitcoin Protocol transaction. The business can also claim the support and backing of numerous renowned economists, NGOs, and academic institutions.

Transactions Commence

In a statement released, Sustainable Bitcoin Protocol CEO and Co-Founder Bradford van Voorhees commented:

“Bitcoin has long been criticised for its energy consumption, but we’re turning that perception on its head. By creating a verifiably climate-positive asset, we’re harnessing the power of Bitcoin to drive the clean energy transition and combat climate change.

“Our team has worked tirelessly to develop the protocol and we’re excited to see the impact it will have on the crypto industry and the fight against climate change. I believe this is just the beginning of a new era for Bitcoin as the ultimate climate-conscious investment.”

Green Bitcoin Mining Companies  

Bitcoin mining is undoubtedly a tedious procedure. It necessitates a variety of extremely complex computer technology that consumes a lot of energy, making the whole process expensive and risky for the environment. To stop the electronic waste and carbon footprints produced by Bitcoin mining operations and to make sure mining facilities adhere to environmental laws, authorities and environmental organisations have begun taking action.

Nonetheless, miners are aware of the major issues and desire to switch to the safest methods of mining. Green Bitcoin mining is the industry's main focus right now.

Compass Mining - The Compass Mining team is committed to supporting the decentralised growth of mining hash rates and BeEF network security by allowing more people to explore, learn, and mine Bitcoin.

Riot Platforms, Inc. - The team commits to a mission to support the Bitcoin ecosystem through proof-of-work mining.

Hut 8 - It is a business building technologists company that believes in decentralized systems promoting financial inclusion and sustainability

These are just to name a few of the thousands out there! Given the exponential growth in this area of digital finance, chances are the best is yet to come anyway.

Other Sustainable Cryptocurrencies 

Since the environmental impact of Bitcoin has come to light in recent months, efforts have been made to reduce the cryptocurrency's carbon footprint, but some investors are abandoning it in favour of more environmentally friendly investments.

SolarCoin - Like other cryptocurrencies, SolarCoin can be spent and traded, but the platform's main distinction is that it attempts to encourage verifiably produced solar energy, a real-world environmental activity.

Powerledger (POWR) - POWR is required to participate in the Powerledger network and helps secure its various products, including energy trading, clean energy tracking, and verification.

Nano (NANO) - NANO is free, fast and used a lot less energy than Bitcoin and various other cryptocurrencies do. They are also scalable and lightweight as it doesn’t rely on mining unlike many. 

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