According to a report by Bitcoinist on July 13, Canadian gas companies are now using a large amount of retained natural gas to mine bitcoin, creating a useful use for these illiquid energy sources. These gases, if not used effectively, will burn into the atmosphere.
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Why natural gas can be used for bitcoin mining
Gas companies in Alberta, Canada, are developing ways to use natural gas to power bitcoin mines. The news was revealed by Francis Pouliot of Bull Bitcoin, a Canadian bitcoin mining company.
Prio said on Twitter on July 10, 2019 that this trend may be very beneficial to natural gas companies. An excerpt from this tweet is as follows:
“Bitcoin has solved a huge problem for more than 1,000 gas well owners. The need to turn the remaining illiquid energy into money is unstoppable.”
In recent years, as natural gas prices have fallen, gas well operators have lost the incentive to collect and transport natural gas. In order to maintain downhole pressure, some gas needs to be extracted.
The end result is that natural gas is continuously burned into the air without any energy recovery.
Bitcoin mining encourages efficient use of energy
However, due to the strict restrictions imposed by environmental regulators, gas well operators cannot burn natural gas indefinitely. Once the threshold is reached, the gas well must be shut down.
Now, the gas company has another way to go – install the Bitcoin ASIC mine and use natural gas to power the process.
This finding also once again validates the notion that Bitcoin digging mining as a “final buyer of energy” as Coinshares pointed out in its latest report.
Bitcoinist has reported that Coinshares claims that renewable energy accounts for more than 74% of global bitcoin mining activity.
In addition, this finding is completely different from the description of the “pollution environment” that critics often propose. Bitcoin mining is spurring companies to seek a more environmentally friendly approach to oil and gas.
More natural gas supplies electricity to bitcoin mines, meaning that oil and gas extraction emits less carbon dioxide into the atmosphere.
Promote further decentralization of mining
North American oil and gas exploration companies entering the bitcoin mining business will further promote decentralization in this area. On a global scale, China is still at the center of Bitcoin's unstoppable mining.
In the second half of 2018, the fate of Bitcoin was reversed and its dominant position declined significantly. However, the company recently announced plans to expand its business in China.
With the halving of Bitcoin block rewards in 2020, miners are trying to take a bigger share of Bitcoin's total power. As a result, the computing power has grown at an alarming rate, reaching more than 70EH/s.