Recently the UAE Abu Dhabi Agriculture and Food Safety Authority (ADAFSA) issued an advisory to UAE farmers stating that crypto mining on farms could cause a sharp spike in electricity bills and cannot be carried out on UAE farm lands. For some this is confusing given that in many countries it is encouraged to utilize bitcoin mining for farming and agriculture.
As per the announcement published in Khaleej Times, “This activity is considered a misuse of the farm for purposes other than its intended use.” Those caught mining crypto on farms shall face fines of up to Dh10,000, it added.
Bitcoin Mining and High energy, water costs
This is not the first time Bitcoin or crypto mining is associated with high energy usage and costs. In a research paper entitled,” The Environmental Footprint of Bitcoin Mining Across the Globe: Call for Urgent Action. Earth’s Future, 2023” the authors used energy, carbon, water and land use data from 2020 to 2021 to calculate country-specific environmental impacts for 76 countries known to mine bitcoin. They focused on bitcoin because it’s older, popular and more well-established/widely used than other cryptocurrencies.
As per the research if bitcoin mining were a country, it would be ranked 27th in energy use globally. Overall, bitcoin mining consumed about 173 terawatt hours of electricity in the two years from January 2020 to December 2021, about 60% more than the energy used for bitcoin mining in 2018-2019, the study found. Bitcoin mining emitted about 86 megatons of carbon, largely because of the dominance of fossil fuel-based energy in bitcoin-mining countries.
In terms of water, global Bitcoin mining used 1.65 million liters (about 426,000 gallons) of water in 2020-2021, enough to fill more than 660,000 Olympic-sized swimming pools. China, the U.S. and Canada had the largest water footprints. Kazakhstan and Iran, which along with the U.S. and China have suffered from water shortages, were also in the top-10 list for water footprint.
“These are very, very worrying numbers,” Madani said. “Even hydropower, which some countries consider a clean source of renewable energy, has a huge footprint.”
Yet in terms of land use, the study analysed land use by considering the area of land affected to produce energy for mining. The land footprint of server farms is negligible, Kaveh said. The global land use footprint of bitcoin mining is 1,870 square kilometres (722 square miles), with China’s footprint alone taking up 913 square kilometres (353 square miles). The U.S.’ land footprint is 303 square kilometres (117 square miles), and likely growing while China’s is shrinking.
ADAFSA Justified in its decision
Mohamed El Masri, Founder and CEO of Permianchain, a blockchain start-up based in Toronto, Canada, that operates a permissioned blockchain platform to unlock liquidity from unused or underutilized natural resources reserves offering a mechanism for funding and energy creation for bitcoin mining and other sectors, explains, “I believe the recent warning by ADAFSA is justifiable and should have come way sooner. In my opinion, the AED 10,000 fine is a good warning fine, but if those miners do not comply, they should be fined a full year of bitcoin production (revenue) and be banned from ever conducting bitcoin mining business in the country.”
According to El Masri it is necessary to impose good practice and a sound regulatory compliant environment to maintain the UAE’s leading crypto stance. He notes, “Bitcoin mining is meant to be a social and economic practice that improves the livelihood of communities where energy and natural resources are underutilized, wasted or require commercial viability to bring to market. By hoarding power on agriculture land where it’s intended purpose is to bring much needed food security to the nation, I find that quite a waste of much needed resources.”
He explains that mining on agricultural land is not scalable anyway, and will not last. He states, “It was always a temporary fix for small-time retail mining managers to make a quick buck… the intention of these operators is money and not community or to build a circular economy for new wealth.”
He offers a solution which entails utilizing bitcoin mining in greenhouses and agribusiness to make use of the heat by-product for water heating, greenhouse crop production and other innovations are already being put to practice in various parts of the world.
Utilizing Bitcoin mining for sustainable Farming
This is true, other countries have opted for using excess energy, such as the methane waste on farms to use for Bitcoin mining. The mining of Bitcoin, requiring substantial energy input for the computational processes, can effectively harness this surplus methane, mitigating its impact as a potent greenhouse gas while simultaneously transforming waste into wealth.
The AmityAge Mining Farm in Slovakia exemplifies this fusion, transforming human and animal waste into biogas, consequently powering their Bitcoin mining rigs. This dual benefit fosters sustainability while offering a robust business model that mitigates greenhouse gas emissions.
In Canada a Manitoba company is using waste heat from bitcoin miners to heat their Greenhouse and fish farm business. In addition Myera Group in Canada is merging the worlds of Bitcoin mining and sustainable agriculture. Within the walls of a former car museum, Bruce Hardy, president of Myera Group, orchestrates a unique operation where more than 30 miners hash away on the second floor, quietly mining bitcoin while generating heat that serves a dual purpose, powering the ASIC miners and nurturing nearby plants in a greenhouse.
Even Iceland which boasts of an abundant supply of renewable energy, making it attractive hub for bitcoin miners, but is plagued with a large gap in food trade balance, depending on imports for basic necessities, is considering utilizing the synergy between bitcoin mining and use of renewable energy to offer a heating solution for businesses and greenhouses.
UAE Bitcoin Mining
In Conclusion the issue might not be Bitcoin mining on farms per say, but on what energy resources are used for Bitcoin mining, and how the excess heat from Bitcoin mining can be used for something useful allowing for a sustainable process, with less effect on the environment while enabling food sustainability.
This is especially important given that Abu Dhabi in particular has become of a hub for Bitcoin mining in the MENA region. In 2023 Zero Two, and Marathon Digital Holdings, Joint entity based out of ADGM for crypto mining inaugurated a 200 MW Bitcoin mining facility at Masdar Abu Dhabi.
As per Marathon digital website, Marathon digital is currently using UAE electricity grid to power the Bitcoin mining farm in Abu Dhabi, with 8,500 operational miners with a hashrate of 1.2 EH/s. ( They note on their website that *Data only represents Marathon’s share of the joint venture and not the total scope of operations). Marathon Digital own 20% of the joint venture.
Many in the ecosystem have noted that in the future, the UAE plans to use solar energy and nuclear energy as sustainable resources for energy production, until then whether Bitcoin is being mined on farms or elsewhere, the energy cost remains high.