Bitmain Launches New Bitcoin E-waste Cycle

We’ve barely had time to process the latest studies on the carbon footprint of Bitcoin mining, or Bitmain (the largest manufacturer of Bitcoin mining machines) is already giving us a reason to worry about another side effect of producing new coins. The mining behemoth has just started selling a new generation of Bitcoin mining machines, ensuring that millions of older devices are about to become obsolete and turn into e-waste.

Efficiency Improvements

Let’s start with having a look at the details of this new generation. The Antminer S15 and T15 have been released as the successors of the extremely popular Antminer S9 and T9 ASIC mining machines. With an advertised power requirement of just 57 Joule per terahash (J/TH) of computational power, the new Antminer S15 is 40 percent more efficient than the Antminer S9. The latter device was running on an advertised power requirement of 96 J/TH. Together with the Antminer T15 the new generation went on sale on November 8, 2018.

The new machines are looking to be a solid investment, despite the fact that Bitcoin market has had a tough year so far. The table below shows that under current market conditions, an investment in an Antminer S15 would yield an annualized ROI of about 34 percent over a two year period. It should, however, be noted that each new Antminer in the market dilutes the profits of all others. If the network hashrate increases by just 5 percent each month (historically 11 percent per month over the past year), it would just yield an annualized ROI of 4 percent.

Antminer S15 Profitability

wdt_ID Description Value Type
1 Antminer S15 details
2 Hasrate 28.00 TH/s
3 Power 1,600.00 Watts
4 Cost 1,500.00 USD
5 Bitcoin Network Details 0.00
6 Hashrate 50,000,000.00 TH/s
7 Revenues 4,680,639,189.00 USD per year
8 Two years of mining (flat hashrate) 0.00
9 Revenues 5,242.00 USD
10 Power cost (5 cents per KWh) 1,402.00 USD

Older Generation Become E-Waste

The first victims of a flood of new Bitcoin mining machines would the older Antminer S9 and T9 and similar machines. Given the higher power requirement of older generations, they will quickly become unprofitable to run. This way they would suffer the same fate as the older generations before them. It also means that a total of well over 4 million machines stand to become obsolete.

Bitmain alone has sold 4.18 million mining devices from the start of 2017 until the end of the first half of 2018, while the company has been selling S9 miners since mid-2016. With no purpose beyond mining, all of these devices would become destined for disposal. In short, they instantly become electronic waste (e-waste). With a weight of around 4.5 kilos per machine, we’re talking about 19,000 metric tonnes of e-waste in total. And assuming Bitmain’s contribution to the total amount of e-waste produced this way is equal to the company’s market share (67%), we could even be talking a potential 28,000 metric tonnes of e-waste from a single generation. 28,000 metric tonnes is equivalent to around 93 jumbo jets, or 6,000 African elephants.

Continuous Cycle

What’s worse is that the cycle of new (more efficient) generations turning older generations to waste is one that is bound to keep on repeating, regardless of (price) conditions in the Bitcoin network. Specifically, Koomey’s law describes how we can expect the number of computations per joule of energy to double every 1.57 years. The various iterations of Bitcoin ASIC mining machines have been keeping up with this trend, as can be observed in the table below.

Antminer History

wdt_ID Bitcoin Miner Hashrate Efficiency Released
1 Antminer S4 2 TH/s 690 J/TH 2014
2 Antminer S5 1.15 TH/s 510 J/TH 2014
3 Ansminer S7 4.73 TH/s 250 J/TH 2015
4 Antminer S9 14 TH/s 96 J/TH 2016
5 Antminer S15 28 TH/s 57 J/TH 2018

Given this trend, Bitcoin mining alone could easily be responsible for a million metric tonnes of e-waste over half a century, and potentially a lot more should the markets turn bullish again. As most of this e-waste ends up as rubbish in landfills (globally only 20% is properly recycled), Bitcoin mining might also be more hazardous to human health than we previously thought.

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One Response

  1. run 3 October 17, 2019