Elon Musk’s Tesla has delivered four massive battery packs that it calls Megapacks to a facility in Texas that wants to mine Bitcoin using only renewable energy, Electrek reported.
Tesla is part of this joint collaboration that involves Blockstream, an expert in Bitcoin, and Twitter founder Jack Dorsey’s other startup, Blocks.
Megapacks have landed, repeat the Megapacks have landed!
— Blockstream (@Blockstream) May 18, 2022
The mining of Bitcoin
Cryptocurrencies such as Bitcoin are decentralized units of trade that rely on a public ledger to keep records of all the transactions that occur. To confirm a transaction on the ledger, one needs a key called hash, which is generated for successfully solving a complex mathematical problem.
Called proof of work, the system also generates new Bitcoins as a reward for individuals confirming the transaction, a process called mining. Over the years, as Bitcoin transactions have increased in volume, mining has become more complex, requiring more computational power.
The issues with mining
With Bitcoin prices having risen manyfold since their inception, mining can be quite a profitable source of income and has attracted small and large players to this space. However, there are no second place prizes in mining which mean there is a constant race to solve these mathematical problems, requiring increasingly sophisticated computational infrastructure and huge amounts of electricity to get this done.
Bitcoin miners have turned to defunct power stations to generate their own power or illegally tapped into state or subsidized resources to fuel their operations. Since a vast amount of our power requirement is still sourced from fossil fuels, the use of Bitcoin, as well as its mining has raised many environmental concerns.
Making mining sustainable
Supporters of Bitcoin have argued that with the world shifting to renewable sources for its energy needs, Bitcoin usage and mining will eventually become sustainable. However, the complete shift is still a few decades away, and in its current form, Bitcoin is highly polluting.
This was the reason that Tesla had to pull back on its plans to accept Bitcoin payments for its electric vehicles. The company has also invested over a billion dollars in the crypto coin and has refused to divest its holdings. CEO Elon Musk has gone on record to state that the company will accept Bitcoin again in the future when mining is more sustainable.
Mining with solar energy
Tesla’s collaboration with Blocks and Blockstream was announced earlier last month, and according to Electrek, work at the site in Texas seems to be moving rather rapidly.
The collaboration’s plans include setting up a 3.8 MW solar farm and storing the harnessed energy in 12 Megawatt hour (MWh) battery packs – the four Megapacks we saw in the tweet above. It surely helps when your collaborator is Tesla, who has expertise not only in solar panels but also in massive battery packs.
Blockstream is lending its expertise in the mining infrastructure needed for such a facility and is confident that once complete will be able to drive computations at the level of 30 Petahashes or 30 quadrillion hashes per second.
Blockstream has said that it will publish periodic reports of its performance in mining crypto with renewable energy. We can’t wait to see what this experiment brings out.