Bitcoin (BTC) has been using ‘Proof of Work(PoW). This energy-intensive consensus mechanism is generating a lot of controversy these days, and environmentalists say it should be banned. The World Economic Forum (WEF) was also in this camp not so long ago, but now it is strikingly very positive about crypto mining.
WEF now in favor of crypto mining?
But the WEF is a well-known critic of crypto mining. The international organization is in fact a strong supporter of the green revolution and argues that it is important to pay attention to the planet. In 2018 criticized it loud and clear Proof-of-Work and the huge energy shortage that bitcoin would cause. The current financial system and other consensus mechanisms such as Proof-of-Stake would be much better.
The Hidden Cost of Bitcoin? Our #environment https://t.co/dF7b2HOkd4 pic.twitter.com/qY5mrmiSaR
— World Economic Forum (@wef) January 15, 2018
But in one video on its website the WEF describes how a start-up captures excess methane gas in the oil industry and uses it for bitcoin mining. Often this gas is flared because it is not profitable to capture it, but crypto has changed this. The energy can also be used to generate energy for crypto mining. This way, the gas is not completely lost, and the mined tokens (often bitcoins) can be sold.
@WEF promoting mining without using the b word! Source below. Contrast this with the tone of the @nytimes hit piece! Same topic … different emotional experience they are trying to deliver. @NYTimesUp pic.twitter.com/d4OEPkWYFc
— Kristine Cranley (@KristineCranley) April 23, 2023
This therefore goes directly against the earlier article of the WEF. In the new video, it claims that the captured energy is used “to power data centers,” but the hardware on display is clearly ASIC mining hardware. ASIC machines are only suitable for certain forms of crypto mining. Perhaps the WEF has therefore abandoned its previous opinion.
Data centers increase energy demand
The company represented in the video is Crusoe Energy, which writes on its website that it has solutions to the flaring problem in the form of “modular data centers.” These can be shipping containers with crypto mining hardware, but also modules for artificial Intelligence and for scientific research.
The WEF also notes that data centers currently represent only 1 to 1.5% of global energy needs, but by 2030 this may have increased to 8%. It may therefore be possible to collect this excess gas form a solution for the enormous energy demand that we will probably see in the future.