![]() ![]() Despite the volatility of its price, its monetary policy builds in a measure of stability by limiting mining to 21 million Bitcoins across a predefined schedule. Bitcoin Is Boomingīitcoin has inspired thousands of cryptocurrencies since it launched in 2009, but in terms of value, it still stands alone. I also address the challenges of the industry, including questions around energy usage and risks, like the ever-evolving crypto regulatory environment. In this article, I offer insights into the fundamentals of Bitcoin mining, and show how to calculate the costs and the rewards, which can be immense. That means companies with access to reliable, low-cost electricity-particularly from renewable sources-have an opportunity to play a central role as the industry evolves in North America. The cost of power is one of the most significant factors in cryptocurrency mining. What I’ve learned from my experience conducting feasibility studies for Canada-based clients exploring this booming business is that new entrants, specifically energy companies, are also moving into the sector in a material way through joint ventures and other partnerships. At the same time, Chinese companies have joined what’s been termed the Great Mining Migration to North America, investing in US facilities and constructing their own massive warehouses equipped with thousands of small computers designed specifically to mine a number of cryptocurrencies, the most popular of which is Bitcoin. ![]() In the wake of the Chinese ban, companies based in North America, which include Riot Blockchain and Marathon Digital Holdings, are raising record amounts of capital as they ramp up production and expand their industrial-scale operations. In exchange for this service, winning miners are paid in Bitcoin (BTC), which reached a record price of more than $68,000 in November 2021. It’s essentially a cryptographic competition to add blocks, or records, to the cryptocurrency’s ever-expanding blockchain network. The ban, which reportedly reduced China’s control of Bitcoin mining from about two-thirds of the global industry in April 2021 to zero in July 2021, has created a new opportunity for North American companies, particularly those in the energy industry, to become more familiar with Bitcoin mining and incorporate it into their business models.įor those unfamiliar with Bitcoin’s inner workings, “mining” is how transactions are validated for a blockchain. The state of Texas, in particular, has begun to emerge as an epicenter since China banned the industry in 2021, sparking an exodus of miners from the country. Despite the cryptocurrency’s wildly volatile price and the increasing environmental concerns, Bitcoin mining is booming in North America. ![]()
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