Outside the cicada-like whir of machines, the bitcoin mine is a desolate concrete lot full of plain-looking warehouses. We’re in Ordos, the famed ghost town of Inner Mongolia province where local farmers became rich off coal reserves hidden beneath the earth’s surface. Now, another kind of fortune is being mined.
Inside the warehouses, miniature block-like computers are hard at work. Green and orange lights flash in steady intervals. The machines hum as they furiously solve equations. They’re competing for the right answer as they apply mathematical formulas to data stored on the bitcoin blockchain, a global ledger of all transactions.
Like mineral gold, mining the digital currency isn’t free. For hardcore miners, the bottom line is cheap electricity.
“In the early stages of China’s mining industry, the cost of electricity wasn’t that important. As long as you had industrially priced electricity, you could mine,” explains Su Jiahai, head of mining at Bitmain, a Beijing-based startup that owns several cryptocurrency mines in China, including the one we’re touring in Ordos.