Bitcoin miners are devouring energy at a record pace during the cryptocurrency runup

tech.hindustantimes.com:

After recovering from a near-death experience during the most recent crypto winter, Bitcoin miners are back in survival mode — spending billions of dollars on equipment and drawing energy at a record pace ahead of an update in the digital currency's code that threatens revenue streams. 

The surge in activity is sparked by a runup in the world's largest cryptocurrency, fueled by newly launched spot Bitcoin exchange-traded funds, and a quadrennial event called the halving that is slated to take place in April. Bitcoin has surged more than fourfold since plunging by 64% in 2022 amid a series of crypto industry bankruptcies and scandals. 

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Since February 2023, 13 of the top mining companies have placed orders for over $1 billion worth of specialized computers, according to data compiled by TheMinerMag based on public filings. CleanSpark Inc. and Riot Platforms Inc. led the group, spending as much as $473 million and $415 million, respectively, on the rigs.

The machines are being purchased to help miners increase efficiency for their operations and lock in favorable electricity rates. Miners are in constant search of cheap power because they use energy-hungry computers to validate records of transactions on the blockchain to earn rewards in the form of Bitcoin.

“Scale matters because you can get machines for better rates, bigger energy deals and drive down the cost of development,” said Asher Genoot, chief executive at Hut 8 Corp., one of the largest publicly traded Bitcoin miners. “When you have scale, you have more marginal and growth profits and you can cover your big costs.” 

All the activity is driving miners to consume energy at a record pace. Last month, miners drew a record 19.6 gigawatts of power, up from 12.1 gigawatts the same period in 2023, according to an estimate by Coin Metrics. That's equivalent to the electricity capacity that can power about 3.8 million homes in Texas,