These 2 prominent assets have one increasing similarity with each other.
The post The surprising connection between Bitcoin and cannabis appeared first on The Motley Fool Australia. –
Bitcoin (CRYTP: BTC) miners and cannabis growers may not appear to share much in common at first glance.
But there’s a surprising connection between the 2 emerging assets.
An electric connection, to be precise. As British police discovered last week.
How much electricity do we need?
Indoor cannabis cultivation requires quite a bit of electricity, mainly to power the high wattage lights which are intended to mimic the sun.
In the world’s fast-growing legal cannabis markets, cultivators tend to toe the line when it comes to tapping into the grid. Meaning they do so legally. And they pay their utility bills just like any other business.
Illicit cannabis growers, on the other hand, sometimes do an end run around the utilities by illegally tapping into power sources they’re not monitored for.
Now, with the electric usage of Bitcoin mining skyrocketing, it would seem that some Bitcoin miners are following that same illegal path.
As Bloomberg reports, police using drones in West Midlands, England discovered a warehouse throwing off an unusual amount of heat. “When British police raided a warehouse, they were expecting to find a cannabis farm. Instead they found banks of computers illegally siphoning the electricity needed to mine for Bitcoin.”
All up there were about 100 computers illegally tapped into the grid.
Police Sergeant Jennifer Griffin admitted, “It’s certainly not what we were expecting. It had all the hallmarks of a cannabis cultivation set-up.”
While Bitcoin mining is perfectly legal in the UK, stealing electricity isn’t, and charges may be pending.
So, just how much electricity does Bitcoin mining require?
According to Citigroup Inc (NYSE: C), the world’s largest cryptocurrency by market value uses 66 times more electricity today than it did back in 2015. And, as Bloomberg noted, the University of Cambridge “estimates it uses more electricity globally in a year than the Netherlands”.
Bitcoin price snapshot
The Bitcoin price is up 1% over the past 24 hours. One Bitcoin is currently trading for US$34,940 (AU$45,377).
Although the token is now well off its all-time high of US$64,829, set in mid-April, it’s still up 19% year-to-date. And lest we forget, only 12 months ago crypto investors could have picked up a Bitcoin for US$9,423.
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