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Malice Or Ignorance? The New York Times Keeps Printing Lies About Bitcoin Mining

The New York Times’ campaign against bitcoin rages on. Even though this time they had the perfect opportunity to write a balanced article, they didn’t. The author reports one positive bitcoin mining story after another, while keeping a snooty attitude and suggesting it’s all a PR move. The title summarizes the New York Times’ stance, “Bitcoin Miners Want to Recast Themselves as Eco-Friendly.”

Related Reading | Valkyrie Bitcoin Mining ETF “WGMI” Approved For Nasdaq Listing

Before we get into it, a quick story. The foremost expert in bitcoin’s energy consumption, Nic Carter, published an exhaustive report on mining. Among other things, it contained hard data that showed to what extent China was mining using hydropower energy. Mainstream media largely ignored it. The party line was that we couldn’t trust China’s statistics. And, that China was probably burning cole. 

Fast forward to last month. China banned bitcoin mining a while ago and bitcoin’s hashrate relocated, recovered, while the network functioned perfectly throughout. Most of China’s mining industry relocated to green energy-abundant countries. What did the New York Times post? An article called “China Banished Cryptocurrencies. Now, ‘Mining’ Is Even Dirtier,” that claims that Chinese miners were using hydropower energy and thus used cleaner energy.

That’s the level of propaganda we’re dealing with.

What Did The New York Times Say About Bitcoin Mining This Time?

The article starts by featuring Argo Blockchain, the company is building a new facility that “would be fueled mostly by wind and solar energy.” They even quote Peter Wall, Argo CEO, saying. “This is Bitcoin mining nirvana. You look off into the distance and you’ve got your renewable power.” What could be wrong with that?

Two paragraphs later, the New York Times starts pushing lies and embarrassing numbers: 

“A single Bitcoin transaction now requires more than 2,000 kilowatt-hours of electricity, or enough energy to power the average American household for 73 days, researchers estimate.”

Of course, those ridiculous claims come from Digiconomist, a widely debunked researcher who happens to be an employee of the Dutch Central Bank. And then, they blatantly quote the malicious study mentioned in the intro. 

“The Bitcoin network’s use of green energy sources also dropped to an average of 25 percent in August 2021 from 42 percent in 2020. (The industry has argued that its average renewable use is closer to 60 percent.) That’s partly a result of China’s crackdown, which cut off a source of cheap hydropower.”

And quote Alex de Vries, one of the study’s authors, being completely off the mark. “What a miner is going to do if they want to maximize the profit is put their machine wherever it can run the entire day.” WHAT? To maximize profit, a miner is going to find the cheapest source of energy possible. Energy is their biggest cost. The cheapest source possible is energy that’s currently being wasted. That’s the situation.

BTC price chart for 03/26/2022 on Forex.com | Source: BTC/USD on TradingView.com
More Feel-Good Stories Framed As Bad News

The New York Times even quotes Paul Prager, TeraWulf CEO, saying “Everyone I talk to now is talking about carbon neutrality. The language has absolutely changed.” And then, the newspaper spreads the good news.

“TeraWulf, has pledged to run cryptocurrency mines using more than 90 percent zero-carbon energy. It has two projects in the works — a retired coal plant in upstate New York fueled by hydropower, and a nuclear-powered facility in Pennsylvania.”

None of these stories are celebrated. Remember the article’s title, they are cynically presented as PR stunts. Then, it´s time for Sangha Systems, who “repurposed an old steel mill in the town of Hennepin. Sangha is run by a former lawyer, Spencer Marr, who says he founded the company to promote clean energy. But about half the Hennepin operation’s power comes from fossil fuels.”

The New York Times Closes The Loop

That’s the worst example that the New York Times could find. A person who “founded the company to promote clean energy” but had to make a compromise to start his business. To close the article, the author brings us back to Argo Blockchain and tries to pull something similar. Apparently, the CEO “can’t guarantee that Argo’s new center will have no carbon footprint. That would require bypassing the grid and buying energy directly from a renewable power company.”

Related Reading | Biden Loves Intel’s Plan To Produce Semiconductors. What About Bitcoin Mining?

And then, they quote him again. “A lot of those renewable energy producers are still a little bit skeptical of cryptocurrency. The crypto miners don’t have the credit profiles to sign 10- or 15-year deals.”

So, Argo is really trying but it’s not possible at the moment for understandable reasons. And the whole industry is moving to a greener path because the incentives are aligned that way. Got it, New York Times. Got it.

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Top 5 Watershed Moments In BTC On-Chain Analysis’ History. Is Your Favorite In?

These five moments shaped Bitcoin On-Chain analysis. Down below you’ll find a basic 101 article that reviews the basic concepts of the trade. If you have any problem with the list, David Puell is to blame. He’s a full-time on-chain analyst and the creator of MVRV and Puell Multiple. He didn’t include the metrics he created on the list, which says a lot.

Related Reading | Lessons From Reason’s “The Fake Environmentalist Attack on Bitcoin” Mini-Doc

In the following article, there’s also something for on-chain analysis experts. A side game called: Did your favorite moment make it? 

1. ByteCoin invents cointime destroyed in 2011, the very first on-chain metric ever, still used today, and first metric to detect holding behavior in any financial asset.

— David Puell (@kenoshaking) February 17, 2022

Anyway, let’s get into it.

On-Chain Analysis Moment #1- ByteCoin Invents Coin Days Destroyed (CDD) AKA Coin Time Destroyed

Invented In 2011, according to Puell, CDD is “the very first on-chain metric ever, still used today, and first metric to detect holding behavior in any financial asset.” How does the metric detect holders, though? According to Glassnode Academy, “Coin Days Destroyed is a measure of economic activity which gives more weight to coins which haven’t been spent for a long time.”

So, the first eureka moment was to get the coin’s age into the equation. That way, the all-important holders also entered. Glassnode again:

“It is considered an important alternative to looking at total transaction volumes, which may not accurately represent economic activity if value was not stored for a meaningful time. Conversely, coins held in cold storage as a long term store of value are considered economically important when they are spent as it signals a notable change in long-term holder behaviour.”

BTC price chart for 02/17/2022 on Gemini | Source: BTC/USD on TradingView.com
2. Moment #2 – Willy Woo and Chris Burniske Invent NVT Ratio 

This one emerged in 2017, and, according to Puell, it’s “where on-chain begins its Golden Age and became clearly an ecosystem of specialists”. It’s also “the first application of traditional economic/financial concepts to Bitcoin”. But, what’s the NVT Ratio specifically? Glassnode Academy responds:

“Network Value to Transactions (NVT) Ratio describes the relationship between market cap and transfer volume. Per Willy Woo, its creator, NVT can be considered analogous to the PE (price to earnings) Ratio used in equity markets.”

Another way to look at it is, “NVT is that it is the inverse of monetary velocity, comparing two of Bitcoin’s primary value propositions”. Those are store of value Vs. settlement/payments network.

3. @nic__carter and @khannib invent realized cap in 2018, the single most important and robust metric in the field, and first verifiable discovery of the cost basis of any asset.

— David Puell (@kenoshaking) February 17, 2022

On-Chain Analysis Moment #3 – Nic Carter And Antoine Le Calvez Invent Realized Capitalization

Created In 2018, Puell thinks Realized Capitalization is “ the single most important and robust metric in the field, and first verifiable discovery of the cost basis of any asset”. But, what is it exactly? According to Glassnode Academy, Realized Capitalization also makes on-chain analysis look into the age of the coins.

“Realized capitalization (realized cap) is a variation of market capitalization that values each UTXO based on the price when it was last moved, as opposed to its current value. As such, it represents the realized value of all the coins in the network, as opposed to their market value.”

Ok, “realized cap reduces the impact of lost and long dormant coins, and weights coins according to their actual presence in the economy of a given chain”. How does it do it, though? Glassnode again:

“When a coin that was last moved at significantly cheaper prices is spent, it will re-value the coins to the current price, and thus increase realized cap by a corresponding amount. Similarly, if a coin is spent at a price lower than when it was last moved, it will re-value to a cheaper price and have a corresponding decrease on realized cap.”

Moment #4 – Dhruv Bansal Invents HODL Waves 

Created in 2018, HODL Waves is the “last major primer in on-chain analysis, first metric to segregate supply into different conceptual frameworks”. According to Purell, it’s also the “most comprehensive economic time analysis on Bitcoin to date”. Surprising no one, HODL Waves also looks at the age of the coins. According to Glassnode Academy:

“HODL Waves provide a macro view of the age of coins as a proportion of total coin supply. This provides a gauge on the balance between short term and long term holdings. It can also indicate where changes in this age distribution occur as the thickness of HODL wave bands change in response to dormant coins maturing, or when old coins are spent, resetting their age into the youngest category.”

5. @ErgoBTC releases the forensics of PlusToken in 2019, the grey swan that defined the market structure of Bitcoin for that year and first relevant nation-state attack on the asset.

— David Puell (@kenoshaking) February 17, 2022

On-Chain Analysis Moment #5 – Ergo Releases The Forensics Of PlusToken

This famous case happened in 2019. According to Purell, it’s “the grey swan that defined the market structure of Bitcoin for that year and first relevant nation-state attack on the asset.” For a report on the situation, we had to consult Crypto Briefing, who spoke to:

“Ergo, the lead researcher of the report, told Crypto Briefing in an email that the most striking feature of this scam was its size. “Billion-dollar scams are very rare,” they said. “We did not expect the previously reported 200K BTC volumes to be accurate, but they were.”

Related Reading | Bitcoin On-Chain Demands Suggests That The Market Has Reached Its Bottom

The Ergo team also explained why the laundry of the funds didn’t work that well. It was because they practiced “self-shuffling.” What’s that, you ask? Crypto Briefing again: 

“It refers to the “repeated UTXO splitting and merging in hundreds of transactions,” according to the report. This method was both easy to track and the most common way in which PlusToken funds were handled.”

This case wouldn’t be complete without a big institution’s involvement. This time, the suspect is Huobi:

“Huobi played a major role in off-loading these funds too, with nearly 250,000 addresses associated with the PlusToken funds. These addresses were reduced to two clusters which were identified following the incompetent privacy standards.”

Of course, those are just suppositions. When it comes to the giant Huobi, nothing’s been proven.

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ESG Organizations Send Letter To Congress About PoW Mining, Bitcoin Responds

Will the ESG FUD ever stop? As a Congressional subcommittee prepares to take a good look at Proof-Of-Work mining, “more than 70” national, international, state and local organizations wrote a letter to the “Congressional leadership.” In it, they use old and unreliable data to get their point across. They completely ignore all of 2021’s research and progress on the matter, because it would invalidate their argument.

The question is, will Congress buy their poorly researched, alarmist letter? The ESG FUD hit PoW mining like a ton of bricks in 2021. It might be based on a poor understanding of the subject at hand, but the public in general definitely bought it. And they quote the bogus numbers that their authorities invented left and right on social media. 

Related Reading | Despite Crackdown, Bitcoin Mining Is Still Alive And Well In China

Also, the whole argument completely ignores Bitcoin’s main virtue. The orange coin provides a framework and tools for the world’s transition to a disinflationary system. Paraphrasing “The Price Of Tomorrow’s” author Jeff Booth, in the inflationary system that we live in, there’s a clear incentive for consumption. If your money’s purchasing power decreases by the minute, everybody will logically buy, spend, and consume everything in sight. That is the real monster that the planet’s facing. And Bitcoin fixes it. 

In any case, Bitcoin’s resident ESG FUD expert, Nic Carter, took it upon himself to reply to the ESG organizations that sent misinformation to Congress. Let’s see how each part did.

The ESG Organizations Make Their Point, Nic Carter Counterpoints

The ESG organizations come out swinging from the introduction on: 

“We, the more than 70 climate, economic, racial justice, business and local organizations, write to you today to urge Congress to take steps to mitigate the considerable contribution portions of the cryptocurrency markets are making to climate change and the resulting greenhouse gas (GHG) emissions, environmental, and climate justice impacts it will have.”

And their accuracies start from the get-go, also:

“In 2018, scientists writing in Nature warned that Bitcoin’s growth alone could singlehandedly push global emissions above 2 degrees Celsius within less than three decades.”

Those numbers are ridiculous. The study assumes a progression relative to the number of users of the network, and that’s simply not how Bitcoin works. Even if the whole planet adopted the Bitcoin standard, the network would still produce one block every ten minutes. Energy consumption is not directly related to the number of users.

What did Nic Carter respond? That the claim is “false, based on a debunked paper with a completely erroneous model of bitcoin.”

2. bitcoin's energy consumption will 'only get worse over time'

most likely will trail off over time, after peaking in the next decade (see https://t.co/8x0koM6nR9 for actually rigorous projections)

— nic carter (@nic__carter) January 6, 2022

Right after that, the ESG organizations even throw Ethereum under the bus:

“The Digiconomist’s Ethereum Energy Consumption Index estimates that the Ethereum blockchain will consume 71 terawatt-hours this year, nearly the same as the energy consumption of Colombia.”

Since the letter is about PoW mining, it makes sense. The Ethereum community seems to have completely ignored the letter, at least over at Twitter. 

BTC price chart for 01/07/2021 on Bitstamp | Source: BTC/USD on TradingView.com
Bitcoin Incentivizes Green Energy Infrastructure

The ESG organizations continue their poorly-researched attack with:

“The GHG emissions from this exorbitant and unnecessary energy consumption is staggering.”

It’s not unnecessary at all. In fact, PoW mining is absolutely essential for a decentralized, permissionless system. And the energy consumption is directly proportional to the security of the network. Plus, it anchors it to the real world. Not to mention the fact that Bitcoin actually incentivizes and finances green energy infrastructure.

Then, the ESG crowd accuses Bitcoin of “exacerbating” the global chip shortage:

“Increased demand for these machines are exacerbating a global shortage of semiconductors. A bipartisan bill by Senators Maggie Hassan and Joni Ernst has called for a report on how cryptocurrency mining operations are impacting semiconductor supply chains.“

With ease, Nic Carter counterattacks with: “Bitcoin miners are not tier 1 clients, they don’t compete with Apple/Qualcomm/NVIDIA for space; the shortage is due to money printing and the demand shock. See section on semis here.”

5. Atlas/ greenidge increased power prices in NY.

The Atlas mine brought back online a fallow coal plant (converted to natgas) which now provides energy to the grid (in addition to mining). That's energy supplied to the grid which wasn't being produced beforehand

— nic carter (@nic__carter) January 6, 2022

Texas Doesn’t Know What Its Doing, The ESG Crowd Does

Then, the ESG researchers make wild, unbacked assumptions about Texas power:

“Following a crackdown on cryptocurrency miners in China, many miners are moving to Texas, due to its deregulated grid, taking away the power that Texans need.”

This completely ignores the fact that the state of Texas went to great lengths to attract those miners. And that, unlike the ESG organizations that signed the infamous letter, power companies in Texas regularly attend Bitcoin meetings. They are making an effort to understand the technology and the opportunities it brings to them. Also, as Carter puts it, “Majority of mining is in west texas where transmission bottlenecks mean prices routinely go negative. Huge overcapacity and limited demand for power outside of mining.”

Miners also participate in demand response, meaning they aren't online when the grid is overburdened. Their presence dramatically improves economics for renewables and does not compete with households during scarcity events.

— nic carter (@nic__carter) January 6, 2022

The state of Texas knows what it’s doing, they see Bitcoin’s future is bright. These ESG organizations think they know better, though:

“Adding more energy-guzzling crypto mining operations to Texas could exacerbate the sorts of blackouts the state already saw during the extreme cold in February — outages that reporting shows hit communities of color the hardest.”

Wow, playing the race card there. So low. And unrelated. Anyway, answering the claim that miners “could exacerbate” the February blackouts, Carter says. “Miners were/ would have been offline during this time, as we demonstrate here. They also help alleviate ‘black start’ issues through primary frequency response.” 

9. Stronghold mining with coal waste is bad (implied)

The coal waste was going to oxidize naturally. It was going to combust anyway. This is an incentive to clean up a nasty site leeching into groundwater etc. Neutral from a CO2 perspective and ++ from an ecology view

— nic carter (@nic__carter) January 6, 2022

Three Other Prominent Bitcoiners’ Response

Are these direct responses to the ESG organizations’ letter? It’s not clear, but the authors published them in the same timeframe. The first one refers to SHA256, the set of cryptographic hash functions that Bitcoin uses. Nunchuk founder Hugo Nguyen said, “Once you understand that SHA256 is close to being 100% efficient at what it does, you’d stop calling it a “waste”. In fact, 100% efficiency is the exact opposite of “waste”. There’s nothing else like it.”

Once you understand that SHA256 is close to being 100% efficient at what it does, you’d stop calling it a “waste”. In fact, 100% efficiency is the exact opposite of “waste”. There’s nothing else like it. https://t.co/SLuVrAPfU2

— Hugo Nguyen (@hugohanoi) January 7, 2022

For his part, Swan Bitcoin’s Brandon Quittem attacks the concept of energy consumption being inherently bad. “Energy consumption is directly correlated with GDP. Want to help developing countries? Help them harness more energy. Interestingly, Bitcoin acts as a free market subsidy for energy investment.”

3/ Energy consumption is directly correlated with GDP.

Want to help developing countries? Help them harness more energy.

Interestingly, Bitcoin acts as a free market subsidy for energy investment.

Incentivizes developing otherwise uneconomical energy sources. pic.twitter.com/DJ6yYoz6WO

— Brandon Quittem (@Bquittem) January 6, 2022

And Kraken’s Dan Held states that “Bitcoin’s energy consumption is not “wasteful.” Why? Because “It is much more efficient than existing financial systems.” And we’re talking orders of magnitude, here. Not only that, “No one has the moral authority to tell you what is a good or bad use of energy (ex: watching the Kardashians).”

1/ Bitcoin’s energy consumption is not “wasteful.”

– It is much more efficient than existing financial systems– No one has the moral authority to tell you what is a good or bad use of energy (ex: watching the Kardashians)

Let's debunk this FUD👇

— Dan Held (@danheld) January 6, 2022

Do you know how much energy American households use for their Christmas lights? As much as the whole Bitcoin network, that’s how much. 

Related Reading | Is This The Reason China Banned Bitcoin Mining? Carvalho’s Mind Blowing Theory

Where is the letter to Congress protesting  Christmas lights, ESG organizations?

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Lessons From Reason’s “The Fake Environmentalist Attack on Bitcoin” Mini-Doc

Phenomenal piece by Reason Magazine. We at NewsBTC have been countering the Bitcoin-is-bad-for-the-environment narrative for a while now. Now, we have a new tool. A short and sweet documentary that rests on a devastating premise. “Such environmentalist attacks on bitcoin are best understood as a strategy by economic, media, and political elites to undermine a powerful new form of money that they can’t control.” Boom! That’s exactly what’s happening.

Related Reading | Bitcoin Mining Vs. The World: BTC Leads Sustainable Energy

Let’s explore the idea further, but first, let’s let Reason Magazine define who they are and what they stand for:

“Reason is the planet’s leading source of news, politics, and culture from a libertarian perspective. Go to reason.com for a point of view you won’t get from legacy media and old left-right opinion magazines.”

You’ve been warned. This is the perspective you’ll get from this article and from “The Fake Environmentalist Attack on Bitcoin” Mini-Doc:

The mini-documentary starts with the filthy propaganda the state usually serves:

“Cryptocurrencies like bitcoin are terrible for the environment,” declares Sen. Elizabeth Warren (D-Mass.). “It’s an extremely inefficient way of conducting transactions,” pronounces former Federal Reserve Chair and current Treasury Secretary Janet Yellen. “It’s a way to both hide dirty money and destroy the environment at the same time,” says Daily Show host Trevor Noah.

Reason Magazine Summarizes The Government’s Perspective

Then, Elizabeth Warren brings up the most ridiculously flamboyant stat ever uttered. According to the Senator, a single Bitcoin transaction uses the same amount of energy that an average house uses in 53 days. WHAT? Couldn’t these government people control themselves and provide a more plausible number? Do people actually believe these made-up stats? Apparently, they do, as the Discord story proves. 

“Discord’s founder and CEO Jason Citron hinted at possible integration with the Ethereum ecosystem, with NFTs, and with the incoming Web3. And all hell broke loose.
Discord fanatics spammed Citron’s replies and canceled their subscriptions to their Nitro premium service. Discord’s own employees took to social media to express their discomfort. Video game culture influencers rallied the masses and gathered hundreds of Likes and Retweets. What were their reasons? Environmental concerns.”

Back to Reason’s documentary, Bitcoin spokesperson Nic Carter dismantles the government’s techniques. They establish an exaggerated per transaction cost, and then “extrapolate Bitcoin’s transactional load to hundreds of billions per year.” They’re not dumb, they know that “The electricity consumed by mining isn’t used to power individual transactions.” However, the average citizen doesn’t. Nic Carter closes with, “Bitcoin’s transactions and Bitcoin’s energy use are not really correlated.”

They aren’t. Bitcoin produces one block full of transactions every ten minutes on average. If we reduced the mining to only one machine, Bitcoin would still produce the same amount of blocks in the same amount of minutes. 

BTC price chart for 11/19/2021 on Capital.com | Source: BTC/USD on TradingView.com
The Media Claims Are Outlandish, To Say The Least

The mini-documentary’s host is Nick Gillespie, Reason’s Editor At Large. He admits “The energy used by Bitcoin mining has increased significantly and it will continue to grow, but the media claims are outlandish.” As an example, he offers this ridiculous 2017 Newsweek article titled “Bitcoin Mining on Track to Consume All of the World’s Energy by 2020.” As you might suspect, Newsweek’s prediction didn’t come true.

Then, it’s time for some real stats. According to the Cambridge Center for Alternative Finance, Bitcoin consumes “just over a hundred terawatt-hours per year.” That’s 117.02, to be exact. That’s on the high end of the spectrum of Nick Hansen’s estimations. According to him, “most likely, the Bitcoin network is between 4.2 and 14.2 Gigawatts” per hour. If the network consumed the full 14.2 Gigawatts per hour, that would amount to 124 terawatt-hours per year. However, it’s probably considerably less if Hansen’s stats are right.

Pick the number you trust the most, it’s still a worthy investment considering everything Bitcoin offers the world.

Critics Tend To Ignore These Facts

Reason defines mining as “the process through which a global network of computers maintains the bitcoin network through computation. Though energy-intensive, this process is what makes bitcoin a truly decentralized monetary system.” And that’s a fact. Proof-Of-Work is essential to decentralization. There is no alternative. A little later, Reason’s Nick Gillespie hits us with another home run, “the work being carried out by this global computer network is what allows Bitcoin to be controlled by mathematical rules instead of human actors vulnerable to government or corporate control.”

Then, the documentary presents another crucial fact, “Miners are incentivized to use energy that would otherwise go to waste.” The Human Rights Foundation’s Alex Gladstein puts it in another way, “Bitcoin miners need energy that nobody else wants.” Why? Because it’s cheaper. The incentives are clear as day.

After that, Reason brings out the ace under Bitcoin’s sleeve, “In the Western United States, mobile Bitcoin miners are already running on electricity derived from unused natural gas from oil wells that can’t be captured because there are no pipelines to carry it.” Luckily for the government, Reason doesn’t bring up everything Bitcoin mining is doing for the Navajo Nation.

Reason Closes It Off With Even More Stats 

In a questionable move, Reason quotes the Bitcoin Mining Council controversial report. That one puts Bitcoin’s sustainable energy use at around 56%. Let’s quote NewsBTC’s report on that number.

“The good news is, there’s data to show that Bitcoin’s “mining electricity mix increased to 56% sustainable in Q2 2021.” Is that data valid? That’s another question altogether. The Bitcoin Mining Council elaborates on the results:

The results of this survey show that the members of the BMC and participants in the survey are currently utilizing electricity with a 67% sustainable power mix.”

Related Reading | Power Ledger Blockchain Firm Signs Deal with Japanese Green Energy Supplier

We can say that because, here at NewsBTC, we’re partial to Bitcoin. Was it a good idea for Reason to use it? Maybe not, but notice that they used the conservative 56% figure and not the aspirational 67% one. The magazine knows what it’s doing. That’s why they brought back Nic Carter to close the documentary, “Bitcoin is a vote of no confidence in the monetary and financial system that exists today.”

That’s exactly what it is. Among other things.

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Controversial Bitcoin Mining Council Confirms “Sustainable Power Mix”

The Bitcoin Mining Council is back at it. The controversial initiative lead by Michael Saylor presented “the findings of its first quarterly survey focused on two important metrics: electricity consumption and sustainable power mix.” The broadcast was delivered via YouTube and open to the public. They choose to limit their reproduction in other sites, though. So, embedding it is not possible.

Related Reading | Poolin Reward Tokens Plummet In Response To China Bitcoin Mining Exodus

According to their survey, Bitcoin mining’s power mix increased to 56% sustainable energy. That figure comes from the answers from “over 32 percent of the current global Bitcoin network.” Can we trust them? Potentially. Will the anti-Bitcoin media and conflicting economic actors believe them? That’s another story altogether.

The still suspect organization was created to combat the environmental FUD spread by Elon Musk and most of the legacy media. Their reason-to-be already appeared on these pages:

The Bitcoin Mining Council (BMC) stated that its purpose is not to be a regulating body of any kind. They are not here to tell anybody what to do. It is to be a forum that is open to all miners. There is no fee required to join. The members just have to agree to be transparent about their energy mix and hash rate sizes for research and educational purposes.

However, the Bitcoin community remains skeptical. The smell of centralization is not tolerated, and these types of organizations tend towards that direction. Is this an open group or a private country club? On the other hand, other members of the community think that “Bitcoin doesn’t care” and that everyone is free to do as they please.

To combat all those narratives, the Bitcoin Mining Council started to hold its meetings out in the open… but always retaining a little bit of that behind-closed-doors allure. 

I.E. YOU are the “general public.”

As Mines Leave China, The Bitcoin Mining Council Attacks

One of the main arguments against the Bitcoin community’s claims that their mining is one of the cleanest industries in the world was China. An estimated 60% of the miners were located in the region, and even though Nic Carter went to great lengths to prove that they were mostly using green energy, the anti-Bitcoin media didn’t believe it. Because they didn’t trust data from China.

Well, the Chinese Government banned Bitcoin mining. As NewsBTC reported, the great miners’ migration is well underway.

Tons and tons of mining equipment are currently traveling to their new homes. There are reports of a huge operation in Kazhakstan, a neighboring nation of China. There are also rumors of equipment and personnel already settling down in Texas. The US state is making a push to become a Bitcoin mining capital, and apparently, the efforts already bore fruit. 

Related Reading | Saylor: North American Bitcoin Miners To Form Coalition After Meeting With Elon Musk

About this fact, the Bitcoin Mining Council’s press release says:

Darin Feinstein, founder of Blockcap and Core Scientific, noted that the survey comes at a pivotal moment as the Bitcoin industry sees its mining operations further decentralized as a result of miners leaving China. “Despite China shutting down over 60 percent of the global Bitcoin network, the Bitcoin network experienced zero downtime, no bailouts, has registered no bankruptcies and simply adapted by redeploying its infrastructure into regions that have greater freedoms.”

BTCUSD price chart for 07/02/2021 - TradingView

BTC price chart on Bitbay | Source: BTC/USD on TradingView.com

The BMC Survey Results For Q2 2021 

The good news is, there’s data to show that Bitcoin’s “mining electricity mix increased to 56% sustainable in Q2 2021.” Is that data valid? That’s another question altogether. The Bitcoin Mining Council elaborates on the results:

The results of this survey show that the members of the BMC and participants in the survey are currently utilizing electricity with a 67% sustainable power mix. Based on this data it is estimated that the global mining industry’s sustainable electricity mix had grown to approximately 56 percent, during Q2 2021

So yeah, the figures are estimations and the data comes from a voluntary survey. We’ll have to wait and see how the story and figures evolve once the China miners find their new homes.

For more information about the Bitcoin Mining Council, go here.

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Bitcoin Hash Rate Goes On Death Spiral Post China’s Crackdown On Miners

The great Bitcoin miners migration is well underway. And the network’s total hash rate is showing it in a big way. Currently, the number of terahashes per second is at its lowest level in the last twelve months. That means that mining Bitcoin has not been easier in a whole year. Also, there’s less competition. So, it’s good news for all the other miners that are spread around the world. However, don’t expect it to last long.

Related Reading | How China Bitcoin FUD Is Lowering The Cost To Produce BTC

Tons and tons of mining equipment are currently traveling to their new homes. There are reports of a huge operation in Kazhakstan, a neighboring nation of China. There are also rumors of equipment and personnel already settling down in Texas. The US state is making a push to become a Bitcoin mining capital, and apparently, the efforts already bore fruit. 

Back in China, the crackdown is no longer a rumor. It’s a reality. CNBC reports:

China’s crackdown intensified over the weekend, with authorities in the hydropower-rich Chinese province of Sichuan ordering crypto miners to shut down operations.

According to reports, more than 90% of China’s bitcoin mining capacity is estimated to be closed. 

Some experts see this as a good thing. It’s estimated that China controlled between 60 and 70% of Bitcoin mining, and the future looks clearer with them out of the picture. The hash rate will suffer for a while, but there’ll be more decentralization. Also, the carbon-powered-energy consumption FUD will decrease. Even though China’s miners were mostly located in areas rich in renewable energy, Bitcoin critics had a hard time believing reports from that side of the world. 

Total Hash Rate (TH/s) of the Bitcoin network | Source: Blockchain.com

Another China Ban, A Reflection Of 2017

This is not the first time that the Chinese government’s cryptocurrency policy caused havoc on the market. In September 2017, they banned crypto exchanges altogether. Just before that, Bitcoinist reported:

While Chinese exchanges used to represent over 90% of Bitcoin’s trading volume, this changed completely with the intervention of the PBoC which led to the end of margin trading and zero-fee policies and to the temporary halt on withdrawals.

All of these changes contributed to China’s trading volume reduction, which saw its market share fall to 3-5% of the global trading volume.

So, historically, the Chinese government has shown no mercy in closing billion-dollar businesses by decree. It’s also worth noting that most of the banned cryptocurrency exchanges just closed their China offices and moved their operation to other countries. They continue working to this day and, for users not in China, the traumatic move didn’t affect their experience in the slightest. Bitcoinist reports again:

The clampdown led to a staggering drop in CNY trading — which comprised over 90 percent at its peak — as traders made an exodus to over-the-counter, peer-to-peer, and foreign exchanges. As a result, jurisdictions with friendlier laws experienced a boom in trading volume as the market flipped on its head

The current situation with the miners is a reflection of that. The mining business is in the process of flipping on its head. The hash rate will recover.

BTCUSD price chart for 06/25/2021 - TradingView

BTC price chart on Bitstamp | Source: BTC/USD on TradingView.com

The Hash Rate Will Rise Again

In retrospect, we should’ve seen it coming. Only two months ago, following a suspicious blackout, NewsBTC reported:

According to the Beijing Economic and Information Bureau, there were concerns about the energy consumption related to these activities. PengPai quotes Yu Jianing, rotating Chairman of the Blockchain Special Committee of China, to claim that the country’s environmental requirements could lead to crypto mining being more “strictly regulated”. Jianing said this will be “inevitable”.

Related Reading | Bitcoin Mining In China To Usher Historic Moment, Will BTC Be Affected?

As for the possible reasons, Bitcoin Magazine’s Lucas Nuzzi cites the upcoming Digital Yuan CBDC. He also defuses the FUD by informing us, “Daily Hash Rate is, by its very design, a volatile metric that is not suitable to track lasting changes in the mining landscape.”

We should also take into consideration Nic Carter’s assertion that all of these things are happening while, “Bitcoin continues to maintain 100% uptime, is nothing short of a modern marvel.”

In Bitcoin, everything’s changing while everything stays the same. The hash rate will rise again.

Featured Image by OpenClipart-Vectors from Pixabay - Charts by TradingView and Blockchain.com