NYSE-listed Square is committing $10 million to support companies driving renewables adoption in the Bitcoin ecosystem. The initiative targets firms who are working on green energy technologies within the Bitcoin mining industry.
Bitcoin mining is the natural focus for the initiative, given that its energy consumption vastly outsizes other areas in the Bitcoin industry. At the time of writing, the Cambridge Bitcoin Electricity Consumption Index estimates that the entire network consumes 9.43 GW.
How much of this energy is powered by renewables is largely unknown. In a December 2019 research study, CoinShares estimated that renewable sources power 73% of the energy dedicated to Bitcoin mining.
A more recent study by the Cambridge Center for Alternative Finance (CCAF) put the figure lower. A survey of 105 miners estimated that 39% of the total energy consumption was sourced from renewables.
Square CEO and co-founder Jack Dorsey foresees cryptocurrency eventually being powered “completely by clean power”. For Bitcoin mining, such a forecast seems unrealistic as some regions are more favorable for miners securing low-cost energy from fossil fuels. Kazakhstan and Iran are contemporary examples.
The $10 million in funds will be allocated as investments in companies. The company notes that any gains from investments will be reinvested back into the initiative.
In their Twitter announcement, several repliers advocated Upstream Data as a potential recipient of the investment. Upstream Data helps oil and gas companies use natural gas, which would have been flared for Bitcoin mining.
Candian startup MintGreen is another firm that may be a candidate for the investment initiative. The firm specializes in providing an immersion mining solution that allows miners to recover heat from their operations.
The investment initiative is part of a broader commitment by Square to be net zero carbon within its own operations by 2030. The announcement also noted that Square is exploring opening the investment initiative to a “consortium of like-minded companies in order to amplify the impact”.