Bitcoin mining 'no danger' to UK energy supply due to high prices

Cryptocurrency mining uses 1% of UK electricity and poses little threat to the country’s supply of energy due to “rip-off” prices, says the National Grid, as Bank of England raises concern about consumption.

Although there are claims that currency miners are causing blackouts, crypto investment platform Coinlist assured that the miners pose little threat to the UK and they prefer to mine crypto in countries like Iceland where purchasing energy is much cheaper.

The assurance from National Grid has come after Mark Carney, governor of the Bank of England said ahead of the G20 summit in Argentina that consumption rates were enormous and called for regulations on currencies.

He said: “The costs of Bitcoin mining are enormous. Its current annual electricity consumption is estimated by some to be up to 52 terawatt hours, double the electricity consumption of Scotland.”

National Grid responded by saying that mining is not a major contributor to demand in GB.

“Any GB cryptocurrency demand would likely appear as a small component within the data centre element of our Industrial and Commercial electricity demand modelling (data centres themselves perhaps accounting for only around maybe 1% of total GB demand although data is limited).

“However, whilst we have no immediate concerns in relation to GB electricity demand, it is an area that we actively monitor as part of our electricity demand modelling in our Future Energy Scenarios,” said a spokeswoman.

The news comes as UK energy industry regulator Ofgem commited on March 6 to implement a price cap on domestic bills by the end of the year, subject to legislation being passed this summer.

Friday also saw the Bank of England's financial policy committee say that cryptocurrencies "do not currently" pose a material risk to UK financial stability.

The FPC, in a statement released on its meeting earlier in the week, said it will act to ensure the core of the UK financial system remains resilient "if linkages between crypto-assets and systemically important financial institutions or markets were to grow significantly".

In the event that one or more cryptocurrency seems likely to become widely used for payments, or as an asset intended to store value, the FPC "would require current financial stability standards to be applied to relevant payments and exchanges".