Currents - Energy Industry Insights: Volume 5, Issue 6

The Possible Xinjiang Coal Link in Tesla’s Bitcoin Binge -

"The main draw is the cheap power needed to run the computers that perform the complicated equations for so-called 'Proof of Work' that confirm transactions without a third party, which forms the biggest part of a miner’s outlay."

Why this is important: Cheap and reliable electric power is essential to the "proof of work" component of Bitcoin mining. The bulk of that cheap power in the near future likely will come from China's Xinjiang region, which is becoming a hotbed of Bitcoin mining. The problem is, the article argues, most of that power is produced using coal plants. While the region has large quantities of coal reserves, China has no economical means to move the coal to population centers in other parts of the country. As a result, its become an attractive location for Bitcoin mining operations, which account for a surprisingly small amount (approximately 0.2 percent) of China's total electricity demand.

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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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