The Secretive Houston Meeting where Oil and Gas Met Bitcoin
That is a statement that connotes two seemingly different groups or sectors finding ways to collaborate. Oil in America is an old-school industry with powerful executives that mostly run the show. This sector has been the literal fuel for global advancement in transportation in the past century. Meanwhile, Bitcoin is a nascent sphere that represents 21st-century technology and independence from traditional finance systems.
Well, it just so happens that these two flag-bearers of different eras have a convergence point. Their association is becoming more robust because of energy utility. The use of natural gas to mine Bitcoin showcases the power of innovation and creativity in the energy sector.
About The Meeting
CNBC reported on a meeting in Houston, Texas, that might be one of the most significant events in the North American mining scene. The meeting took place in a residential back street of Houston, in a 150,000 square-foot warehouse. Well, that sounds saucy, right?
But it wasn’t a nefarious conspiracy to take over America or whatever imagination such a setting would conjure. It was simply two industries finding ways to benefit mutually.
The substance of this prospective symbiotic relationship was the use of natural gas to power Bitcoin mining rigs. This arrangement would provide Bitcoin miners with cheap power and make money for the gas providers from a resource that was otherwise going to waste.
Such opportunities are rare. Two industries mutually benefit and solve their problems in one undertaking. Natural gas wastage is a fixture of oil mining operations, while Bitcoin needs all the cheap electricity it can get.
One of the attendees to this meeting, Hayden Griffin Haby III, described his incredible turnaround in views of crypto. He is a 14-year veteran in oil and gas and had not enquired much about Bitcoin until 2020.
In November 2020, he had an experience of how natural gas can facilitate Bitcoin mining. Hayden took up Bitcoin mining and co-founded Limpia Creek Technologies, which powers Bitcoin mining rigs with flared, vented, and stranded natural gas assets.
Hayden has had a complete transformation and intends to grow his business through such forums. Bitcoin mining is flexible and can operate very near oil drilling sites. This utility is what has allowed Hayden and hundreds of other entrepreneurs to enter into the Bitcoin mining business easily.
A Golden Opportunity for Energy Producers
The migration of Bitcoin miners out of China has contributed to the mining boom in the U.S. Texas is one of the most attractive destinations because it has plenty of energy sources. Houston is a crucial oil city and has been the unofficial capital of the oil industry for decades.
Accordingly, energy producers are bracing for the influx of more miners into the state. Bitcoin miners need to find cheap electricity and a suitable mining environment. Texas has a deregulated power grid and plenty of inexpensive power sources. This combination works well for miners. Notably, the natural gas that is a by-product of oil mining is otherwise going to waste.
Therefore, the energy producers have a vested interest in attracting Bitcoin miners. Reports indicated that the mood at the meeting was exuberant, with many excited to explore the benefits of Bitcoin mining. It wasn’t an exclusive meeting of oil tycoons. Instead, most attendees were relatively young and emerging in their respective fields.
Oil drilling is a messy affair. Drilling often involves finding more than just oil. Accordingly, oil miners have often struggled to handle the result of accidentally hitting a natural gas formation. Gas delivery requires a pipeline, which is another logistical nightmare for drilling companies.
Accordingly, new oil wells often end up just burning the natural gas into the atmosphere. This situation can last for a while if the oil well is at a remote location that will take time to connect to a pipeline. Sometimes if the gas is not enough to sustain the costs of building a pipeline, miners don’t bother.
Bitcoin Miners Bring Capital and Efficiency
In case you haven’t noticed, Bitcoins are pretty valuable.
Therefore, a typical Bitcoin miner brings ready capital to a place like rural Texas or the Mid-Western towns that have been on the decline for decades with the manufacturing exodus from the U.S.
Bitcoin mining serves a valuable role in such areas. The new oil-Bitcoin alliance means that more crypto mining operations will serve a mutually beneficial purpose for these locations. Miners from China are looking for new places to set up shop and will be excited to find such opportunities.
Natural gas is more efficient than coal, which produces significantly more CO2 emissions. Chinese miners use coal heavily and will be eager for a different option in any new destination.
Accordingly, oil companies will no longer need to waste “stranded gas.” The sweet spot for both industries is low volumes of gas that don’t justify a pipeline. Oil companies also have pressure to reduce their CO2 emissions. In April 2021, the US Senate passed a measure to strengthen methane emission regulations.
These regulations had been weakened under the Trump administration. Drilling companies find Bitcoin mining more efficient than flaring, which would help them achieve these regulatory objectives. The collaboration with Bitcoin miners is a unique opportunity to kill multiple birds with one stone. This alliance could be indicative of a national phenomenon in the works.
Bitcoin Criticism Should Be More Objective
Critics have upped the ante on Bitcoin in the past year. Unfortunately, most of these attacks are slanted and paint an incomplete picture. For instance, with this use of natural gas, some will still find ways to criticize the industry.
Bitcoin is fueling investments in renewable energy at levels only governments can compare. These critics often fail to notice that miners find creative ways to source electricity. For instance, in the case of natural gas, it would otherwise go to waste. Bitcoin mining is also creating ready demand for hydropower and wind power sources in remote areas.
Therefore, the electricity consumption of Bitcoin should be the subject of nuanced conversations. Miners are always on the lookout for cheap and efficient energy. These efforts are especially vital where the mining farm sources electricity outside the primary grid.
Such debates should find solutions rather than trying to shut down Bitcoin. The combined knowledge and innovation capabilities of stakeholders in this sector will continue to unveil incredible ways to provide cleaner energy.
VBit Mining Promotes Green Mining
As more Bitcoin miners transition to more efficient electricity sources, renewable energy has to be part of the conversation. VBit mining will gladly welcome more green mining because we have been on the renewable electricity train since 2018.
Additionally, we offer hosted mining services to prospective miners. Our direct line to Bitmain provides us with a chance to procure elite equipment. We have data centers in North America that utilize cheap hydroelectricity and natural cooling. These variables are the essentials of Bitcoin mining.
Accordingly, we are happy to note the rest of the industry is catching up. Bitcoin mining can be a clean and productive affair for all stakeholders. We are committed to using our experience and expertise to help others in the Bitcoin community to achieve these goals. Visit VBit Mining Shop to learn more about Bitcoin mining!