Trends can tell a lot about where an industry has come from and where it’s going. When Bitcoin first launched in 2009, individuals were mining Bitcoin from their laptops, and I personally was mining Bitcoin from a few mining rigs set up in my dorm room. We didn’t know that we’d have to be concerned about things like energy consumption at scale, hardware suppliers, and maximizing operational efficiency in massive data centers. But as Bitcoin mining grew and scaled, trial and error provided opportunities to learn and create new innovations to help the industry grow.
While 2022 has been a challenging year for Bitcoin and the crypto industry in general, the mining industry continues to grow. The following trends show how the Bitcoin mining industry is building on past knowledge and experience, and preparing for a scaled future.
Trend 1: Renewable Power
It may be the biggest buzz item about Bitcoin mining today: energy usage. Mining rigs take electricity to power, and large-scale mining operations are running thousands of miners at a time. Much has been written about how much energy mining utilizes — up to 110 terawatt-hours per year, the equivalent energy production of a small country. But the key topic of discussion should be what kind of energy sources are mining operations using.
One of the major trends we’re seeing in Bitcoin mining today is the turn towards more renewable energy sources instead of carbon-based power. The idea that dirty sources like coal are cheaper just isn’t true, as 90% of hydropower, 75% of wind, and 40% solar are still less expensive than the cheapest fossil fuel option. It’ll be a natural development for those power sources to take over the mining market. Increasing utilization of renewable energy will be beneficial in the long term, both for the industry and for the plant, which is why in the short term, even while profitability is very high, miners should actively consider their power source.
The good news is that Bitcoin mining operations are already turning to more renewable resources. The Bitcoin Mining Council estimates…