• J McGlynn and M Bacina

Looking towards green bitcoin - IRIS Energy


After raising $25 million in its first pre-IPO round last December, Australian start-up Iris Energy, is gearing up for another pre-IPO round before its attempt to go public before July (paywall).


Recognising that “by 2030, up to 51% of global electricity usage will be dedicated to communication technology”, the energy company is one of the few start-ups that are attempting to use low-cost and sustainable energy to tackle the increasing energy demands of computing technology. For Iris Energy, this has come in the form of “building a high-performance data center platform [which provides] access to low-cost renewable energy” (more specifically, hydroelectricity).


The rising demand for energy has long been a recognisable drawback of growing technology, so the platform aims to subsidise the high-energy demands of many high-performance computing applications including artificial intelligence, smart Cities (IoT) and bitcoin mining.


Specifically, bitcoin mining often receives criticism for being power intensive, however, the aims of Iris Energy align well with the reports that over 70% of miners use a mix of renewable energy.


Iris Energy supports Bitcoin mining


One of Iris Energy's main focuses over the past two years has been mining Bitcoin in its Canada based data centers. Reportedly, the facility currently uses around nine megawatts of power which it expects to hike up to thirty megawatts by the end of the year. In terms of dollars and cents - meeting this 30MW target would mean Iris will be raking in a “somewhere around $75 million dollars in revenue and $54 EBITDA annually”.


When its shares are made available to the public later in the year, Iris also expects to raise a minimum of $50 million which it can use to build out its mining capacity even further. With "500MW worth of projects across Western Canada, Central USA and the Asia-Pacific" already identified by Iris, their plans to grow appear to be going full speed ahead.


Implications


In order to remain cost efficient, bitcoin miners must consider their options to minimise the costs of their operations. Phillip Sander, Professor of the Frankfurt School Blockchain Center, stated that the architecture of Bitcoin is only beneficial for mining companies that have access to low-cost electricity and efficient mining hardware”. Therefore, it seems that companies like Iris will be well received by the public and bitcoin community hoping to tackle the energy use problem.