A small town in Washington state is a cryptocurrency mining haven as it is home to a hydroelectric dam system that harnesses the flow of the massive Columbia River and generates some of the cheapest power in the US.
This cheap and abundant power is what draws increasing numbers of cryptocurrency miners into Wenatchee, WA.
One such outfit, four years into the business, reportedly generates from 5 to 7 BTC/day which per todays rate translates to $45-65,000. They expect to raise this to 50 BTC/day by July.
When asked how massive is the scale these newly-established mining activities are, Frank Kuntz, mayor of Wenatchee, told WSJ: “If you ask the guys at UPS or FedEx what they’re delivering to Wenatchee, I think they’d tell you it’s a whole bunch of bitcoin mining machines.”
Nationally, in the US, the average energy cost is around 10 cents per kilowatt-hour (with the highest 13 cents). In Wenatchee, the presence of gigantic hydroelectric dams along the Columbia River drives these costs down to as low as 2-3 cents. For miners who suck up as much as 100 megawatts per outfit that adds up to huge savings.
No wonder this gives rise to this kind of coin rush. The authorities express their concern as the grid might not be able to support such demand.
Over the past several years, as many as 30 mining businesses have popped up in this town and surrounding counties, renting apartments, cargo containers, old warehouses, and the like.
According to local officials, they receive up to 20 calls a week from crypto-miners asking to set up shop in the region. And the public utility company where Wenatchee is located has already received four more mining inquiries, all of which require 100 megawatts each. That amount of energy is enough to power 50 hospitals.
It is estimated that the wattage required to generate one coin could power the average American household for 2 years.
Such energy consumption is raising some serious questions about the sustainability of cryptocurrency mining at large.
The proposed solution is often renewable energy, but in Wenatchee, it is a tough change.
Though Iceland has managed to deal with the increase in new mining data centers thanks to the country’s near 100 percent renewable energy and cold climate which helps prevent computer servers overheating. And this year, the amount of power used to mine bitcoin is set to overtake the country’s entire domestic power usage.
Image source: The WSJ
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