In many US states, bitcoin miners play a crucial role in the development of green and sustainable energy through load balancing. (Photo: 123RF)
LES KEYS DE LA CRYPTO is a section that patiently decodes the world of cryptocurrency and its stock market, industrial and media turmoil. François Remy’s mission is to identify promising entrepreneurs, decode technical progress and anticipate the industrial and societal impacts of this digital currency.
(Illustration: Camille Charbonneau)
Critics of bitcoin are likely to freak out over such an assertion. How could this cryptocurrency “mining” industry, whose energy impact was predicted to be cataclysmic not so long ago, ultimately turn out to be so virtuous? Responses with Canaccord Genuity analysts.
Business leaders from various sectors, but also players directly involved in digital assets recently took part in the Canaccord summit dedicated to blockchain infrastructures.
The opportunity to look back on the resilience shown by this particular crypto mining industry over the past eighteen months despite volatile cycles (the exodus from China, COVID, the current macroeconomic environment).
The industry is increasingly attracting energy suppliers, the speakers stressed on several occasions. And for good reason, analysts Joseph Vafi, Michael Graham and Pallav Saini write in a briefing note for their clients: “bitcoin mining is surely emerging as the greenest of all industries”.
A point of view defended by the Bitcoin Mining Council (BMC), which defines itself as an “open and voluntary forum”, and brings together industrial players in the crypto ecosystem like the Quebec mining giant Bitfarms, its Toronto neighbor. Hut8, their California counterpart Marathon Digital. The renewable energy mix amounted to 66% over the last three months of 2021, the interest group indicated last January.
However, the extraction of BTC remains negatively connoted with polluting energies. “We think this notion couldn’t be further from the truth,” the analysts insist. “Powerful complementary relationships are being established between renewable energy producers and bitcoin miners.”
The boon of an energy-intensive industry
By meeting the constant electricity needs of crypto mines, these producers are subject to less risk, particularly during periods of low demand. BTC miners use energy that would otherwise “go with the wind” or be just “water flowing under bridges.”
Thus, Canaccord continues, bitcoin miners are driving the expansion of carbon-free, renewable energy generation across the industry.
The environmental controversy around the most famous cryptocurrency would be based on a broad problem of perception. It would be possible to ensure the expansion of these high-growth companies while maintaining a neutral carbon footprint.
In many US states, including Texas to name a few, bitcoin miners play a crucial role in the development of green and sustainable energy through load balancing.
From an ESG (environment, sustainability and governance) point of view, the extraction of bitcoins also appears to be much more respectful of the environment than the extraction of gold, this class of traditional assets risking losing shares in favor of bitcoin, we pin at Canaccord Genuity.
Crypto-enthusiastic energy companies
During the Canaccord summit, a speech by a former senior BC Hydro official, David Nikolejsin, shed some interesting light on the subject. In his observation, it emerged that at the local, provincial or federal level, the negative perception of the mining persisted.
To be convinced of this, one only had to look at the legislation that recently came into force in British Columbia. Without forgetting the policy of self-sufficiency which has imposed the need to meet peak demand with more and more green energy. This resulted in a significant energy surplus.
However, bitcoin miners are helping local communities, including indigenous tribes, near mining facilities by creating new jobs, said David Nikolejsin