How Bitcoin mining devastated this New York town
Between rising electricity rates and soaring climate costs, cryptomining is taking its toll on communities.
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People began scouring the world for cheap sources of energy to run large Bitcoin-mining farms using these circuits. Cryptocurrency notoriously devours electricity; each Bitcoin transaction consumes 1,173 kilowatt-hours—more than the average American uses in a month. In 2020, the world’s crypto mining required more energy than the whole of Switzerland. At the time, Plattsburgh had some of the least expensive power anywhere in the United States, thanks to cheap hydroelectricity from the Niagara Power Authority.
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Coinmint filled the building with servers, running them 24 hours a day. When the miners wanted to expand into a nearby shopping center, Bill Treacy, the manager of the Plattsburgh municipal lighting department, told them that they would have to invest $140,000 in new infrastructure. He was surprised when they weren’t discouraged. Soon, the company was regularly drawing over 10 megawatts, enough power for about 4,000 homes.
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Economist Matteo Benetton, a coauthor of the paper and a professor at the Hass School of Business at the University of California, Berkeley, says that crypto mining can depress local economies. In places with fixed electricity supplies, operations suck up grid capacity, potentially leading to supply shortages, rationing, and blackouts. Even in places with ample access to power, like upstate New York, mining can crowd out other potential industries that might have employed more people. “While there are private benefits, through the electricity market, there are social costs,” Benetton says.
Full article at this link:
https://www.technologyreview.com/2022/04/18/1049331/bitcoin-cryptocurrency-cryptomining-new-york/
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