It’s math

EDITORIAL

This editorial is going to attempt to explain, in understandable words, what bitcoin and bitcoin mining is all about. This editorial is almost certainly going to fail to do that adequately. But we—all of us in Rockdale—have got to try, or at least come to grips with an industry which is going to play a huge, and most welcome, role in our economy for years to come. We’ve done it before. Not too many of us were conversant with terms like catalyst, anode, the Hall Process and overburden before Alcoa came to town. Alcoa, of course, made a product you could see, touch and haul off with a truck. Bitcoin mining is, well, different. Let’s start with the concept. Bitcoins are what’s called a “cryptocurrency.” It’s not the only one; there are dozens. You can use bitcoins, if you are fortunate enough to own them, to pay for an increasingly growing number of goods and services. Here’s the key. Bitcoin (any cryptocurrency) is totally outside our familiar banking and finance systems. As expert Kirk Phillips points out: “... within its protocol (Bitcoin) ownership is not based on the rule of law, or user accounts, or even identity, it is solely based on math.” You “mine” bitcoins—and that’s what will happen at the former Alcoa smelter—by crunching complicated strings of network transactions. Bitcoin expert Aaron von Widrum likens the process to a lottery. Miners, through their computers, guess what mathematical “blocks” the bitcoin system will accept. How? Computer hardware, lots of it, is used to try and solve an extremely complicated math problem involving previous bitcoin transactions. There’s that M-word again. Get enough and you can be awarded a bitcoin. By the way, there are a finite number of bit-coins, about 21 million will be in existence. So what do miners have to look forward to when all the bitcoins are mined? Go after the other cryptocurrencies. Clear as 600 feet of overburden on top of a lignite seam? Right. Okay, here’s what it really means. Alcoa closed up its Rockdale Operations beginning about 10 years ago. Luminant turned off the switch at Sandow and the loaders at Three Oaks in January. That meant nothing was happening six miles southeast of town in a place Rockdale has come to depend upon for a huge chunk of its economy. Now, something is happening out there again and it’s big. Let’s hear it for math!—M.B.