Why now is the time to move your blockchain operations to North America
When deciding where and how to host your blockchain operations, the average cost of power is always a chief concern – and it should be. But what about the stability of that power?
In many regions throughout the world, energy moves from being inexpensive and bountiful in one season to being practically unavailable in the next.
This is truer nowhere than in certain regions of China that take advantage of seasonal climates to maximize bitcoin mining profitability – only to move operations elsewhere once the season has subsided.
Bitcoin mining during China’s rainy season
In China, bitcoin mining is most prevalent in areas with major rainy seasons that are able to make use of cheap hydroelectricity. Between June and October, the dams in these regions become full of water, also contributing to a healthy and inexpensive supply of electricity – and a profitable bitcoin mining environment.
But as the rains begin to dry up in the autumn, energy comes at more of a premium, and mining profitability takes a corresponding hit. As the price to mine bitcoin triples or quadruples, miners pack up and make plans to move their blockchain hosting operations – at least until the beginning of the next rainy season.
During this transit period, mining losses are compounded even further, as miners are offline for some time and are thus unable to contribute to a healthy bitcoin hashrate. Nowhere in the world are miners more responsive to changes in the season.
Many Chinese miners find this unappealing and are now looking for alternative options to avoid this hassle, including relocating parts of their blockchain hosting operations to regions where there is a more stable energy supply and greater geopolitical stability – like North America.
Benefits of blockchain hosting in North America
The energy cost variability in China and other regions paired with the impact of miner downtime and the hassle of moving equipment all make the stability of North America – and of the U.S. in particular – an increasingly appealing option.
Here are a few of the key benefits of hosting your blockchain operations in North America and the U.S.
Cost-competitive and stable energy costs
Power in parts of the U.S. can be less expensive than in many other countries around the world, averaging a cost of 7.01 cents per kilowatt-hour for industrial consumers as of September 2020. Power costs in the U.S. are also bit more consistent (with some exceptions such as upstate New York) and do not change as much throughout the year in response to factors like seasonal changes.
While China is more or less in control of its own fate when it comes to electricity, it still remains highly vulnerable to market conditions and supply shocks in the industries of oil and gas.
In addition to stable and inexpensive energy, bitcoin and blockchain operations in the U.S. are also able to benefit from a more stable regulatory policy surrounding digital assets. Cryptocurrency and blockchain have become a priority in the U.S., especially in regard to national security. Increased regulatory enforcement provides business and asset protection for larger companies.
The U.S. is also a free market economy, while communism and similar geopolitical structures in other parts of the world can lend themselves to unpredictable government control. This uncertainty puts mining operations at risk. There have been instances in other countries of governments seizing mining equipment – a threat that is protected against by laws in the U.S.
Trusted and transparent business practices
Businesses in the U.S. are also known for being more professional and transparent in their business practices, striving for greater trust and credibility in fostering customer loyalty. The modern consumer requires honesty and integrity from its business partners, and American companies seek to deliver this sentiment in everything they do.
Since transactions on bitcoin’s ledger are verified by a consensus among the majority of the network’s users, the network can be left vulnerable to a 51% attack, wherein the majority of the miners use their collective hashpower to take control of the network. A movement of miners from China to the U.S. would decrease the potential of such an attack by reducing the likelihood of centralization.
Host your blockchain operations safely and powerfully with Compute North
Compute North owns and operates state-of-the-art colocation facilities designed specifically to help you make the most of blockchain technology. We have pioneered the concept of the TIER 0TM data center – an innovative concept aimed at providing organizations with an alternative to the more expensive, more traditional solutions available both here in the U.S. and abroad. Each of our campuses is constructed in a strategic location across the U.S. to allow users to focus solely on ROI and less on logistics.
We offer fully managed services to oversee all aspects of your operation with hands-on, professional support. Using MinerSentry, our proprietary cloud-based management and monitoring platform, we enable you to be completely hands-off with maintenance and upkeep to spend more time focusing on maximizing hashrate, uptime, and revenue. We even manage miner configuration changes and optimization to ensure you are always up and running as effectively as possible.
Benefits of our blockchain hosting services include:
- Cost-competitive infrastructure powered by renewable energy
- Secure environment to keep your hardware and your data safe
- Core infrastructure with power, space, ambient air cooling, internet access, physical racks, and security
- And more
Contact us to learn more.