Sweat-Powered Equity in the Bathhouse

In Williamsburg, Brooklyn, a sleek wellness center draws a trifecta of well-coiffed influencers, tech bros, and self-care aficionados with its promises of Bitcoin-powered heated soaking pools. Bathhouse, which has branded itself as a futuristic oasis for busy New Yorkers, offers a menu of various hammams, saunas, and pools. Going to Bathhouse means engaging with a sanitized pseudo-spirituality (essential-oil healing sessions are announced by “vibe gong”). So, it makes sense that the owners have supplanted the cultural and spiritual significance of the bathhouse with their own mythological force—proof of work.

The concept of proof of work was first sketched out in 1992 by academics looking to combat the scourge of spam email. Computer scientists Cynthia Dwork and Moni Noar proposed that senders would need to first complete a mathematical puzzle, a digital roadblock that would deter a deluge of mass emails. Deemed too energy intensive, their solution was shelved in favor of spam blockers. The term “proof of work” was later formally coined in a paper by Markus Jakobsson and Ari Juels, titled “Proofs of Work and Bread Pudding Protocols,” which attempted to find alternative tasks to make the energy expenditure useful, and thus less wasteful. The legacy of proof of work returned to the mainstream in 2008 with the now infamous whitepaper “Bitcoin: A Peer-to-Peer Electronic Cash System.” The paper’s anonymous author, whose moniker “Satoshi Nakamoto” became a household name, outlined an economic system that would use blockchain technology to verify and securitize peer-to-peer digital transactions without the interference of government institutions and banks. Following a crypto-anarchist logic, Nakamoto fleshed out a future in which anonymity-protecting technology could render state control of the market impossible.

In this vision, proof of work validates transactions by pitting decentralized “miners,” or computers, against one another to solve complex cryptographic problems. Those who arrive at the solution first are then allowed to add a “block” to the “blockchain.” In verifying the legitimacy of the transaction, the “winner” is then awarded cryptocurrency for their efforts. As a result, the integrity of the currency is directly linked to the capacity for massive amounts of computational labor, a process with immense energy demands.

In a document published to its website, Bathhouse explains how it heats its pools with two ASICs (Application-Specific Integrated Circuit), which are computers designed specifically for Bitcoin mining. Churning below ground, these machines hurtle through energy-intensive math puzzles as a part of the mining process, giving off the byproduct of heat which is then, thanks to the law of conservation of energy, recycled by a heat exchanger into warm water. At first glance, this alchemical process seems like the ultimate hacker fantasy—infrastructure for a decentralized digital currency that doubles as a viable energy source.

When McKenzie Wark wrote A Hacker Manifesto, she positioned hackers as a people on the precipice, a class organized around new modes of production offered by technology and, by extension, their capacity for world building with it. In calling for an end to the myth of scarcity, she underscored the infinities offered through abstraction and the virtual, and the liberatory potential of an alliance between hackers—masters of abstraction—and other workers, farmers, and producers of the world.

In the two decades since the manifesto’s publication, we’ve seen the evolution (or dissolution) of the hacker-as-class, as well as an ushering in of a new world. Wark’s caution against the rise of a “vectoralist class,” a ruling elite determined to control the information produced by the hacker class, has proven prophetic. Some who may have once identified as hackers have stepped into the shoes of the vectoralists, assuming roles of unimaginable power as business moguls, cultural arbiters, and policy shapers. The technologies and worlds this mode of production has midwifed have fundamentally altered our ways of life, a process of transformation that internet historian and writer Ingrid Burrington once likened to terraforming.

Taking stock of the sheer acreage allocated to data centers and the hundreds of thousands of miles of fiber-optic cables crisscrossing the ocean floor, it becomes clear that these infrastructures, essential to the maintenance and upkeep of the current flows of information, are indeed remaking the material environment in the likeness of the computer. A closer look at these infrastructural sites reveals a convergence of material flows—water, electricity, air, heat, metals, minerals, and rare-earth elements—whose combined metabolic processes constitute computing as an ecological force within itself.

Currently, the Williamsburg location of Bathhouse employs twelve miners, or computers, with a hashrate of twelve hundred terrahash. This scale, which resembles most early Bitcoin mining rigs, has the feel of a glorified science-fair project when compared to the commercial crypto mines that have metastasized across the industry. The cost of autonomy doesn’t come cheap. These mines are voracious consumers, guzzling up enough electricity and water to rival the annual consumption rates of entire states and countries. Although Bitcoin is predicated on the infinite, engendered as it is by abstraction, its future is deeply tied up with that of the material resources on which it relies. Here, the abundance of the virtual brushes up against the scarcity that has come to dominate conversations around our environmental future.

To better understand the contradictions of cryptocurrency’s relationship with scarcity, we can look to water, an element with its own misplaced reputation for the infinite. While Bitcoin’s energy consumption has come under increased scrutiny, its water footprint has received less attention despite a snowballing global water crisis. An essential component for most commercial mining operations, water is used in cooling systems to keep machines from overheating as well as indirectly in the power plants that provide energy for mining, using over a thousand gigaliters of water a year. One recent study examining the water consumption of crypto mining estimated that the water footprint of just one Bitcoin transaction was equivalent to that of a small swimming pool.

As it stands, worldwide escalations in drought and flooding due to climate change necessitate a shift in our collective relationships with water. However, Bitcoin mining shows no sign of slowing down. By the time of this article’s publication, Bitcoin will have undergone another halving event, a mechanism in cryptocurrency’s model that reduces the Bitcoin rewarded to miners by half about every four years. Meant to preserve the value of cryptocurrency, halving also means that mining the same amount of Bitcoin will now take double the amount of energy and water as it did previously. Bitcoin boosters are quick to gloss over cryptocurrency’s water costs, a stance in line with the accelerationist slant many adopt in their drive to build out a new financial order. Water, however, operates on its own intrinsic matrices of time and space, ones that often clash with those imposed by systems of commodification.

Greenidge Generation

In urban planning, the term “daylighting” describes the practice of restoring watercourses that have previously been buried due to urbanization. Smelly, dirty, and polluted, these waterways were historically driven underground because they were seen as urban lesions, evidence of industrialization’s environmental toll. In recent years, daylighting has gained popularity not only because of increasing demand from urban populations for recreational green space, but also because of water’s own unruly defiance. In many cases, flooding runs rampant where rivers, streams, and inlets have been built over. Unable to access its natural course, buried water in turn has cost cities millions in damage and destruction. Daylighting, then, might be seen as an instrument of attunement, a means of realigning the built environment and our modes of existence with our ecosystems, a way to reframe notions around water’s (in)sufficiency.

Contextualized within an ever-unfolding hydro-social lineage, the twinned acts of retracing and unearthing required of daylighting might serve as a conceptual framework through which to understand cryptocurrency’s impact on current water politics. In the United States, cryptocurrency mines often find their homes on sites with an inheritance of extraction. Because of the space and the access to energy infrastructure they offer, abandoned or close-to-abandoned coal and natural gas plants are reanimated, their vacant shells finding new purpose in the project of housing and powering energy-guzzling industrial cryptocurrency mines. Many of these are located on geographies with long-held connections to coal, natural gas, and heavy-metal industries.

On the shores of New York’s Seneca Lake, one such mine has found itself at the center of a political maelstrom, as local communities and environmental groups join forces in a campaign against it. Located in a mothballed coal plant, the site was purchased by a private equity firm in 2014, before being converted into a fracked-gas plant. The site drew renewed attention from locals in 2020 when the firm began transforming the facility into a Bitcoin-mining operation. Taking on the name of the coal plant that came before it, Greenidge Generation has made more than $100 million a year mining Bitcoin on over twenty thousand computers.

Public outcry against Greenidge Generation orbits around three central concerns: greenhouse-gas emissions, noise pollution, and the warming of Seneca Lake. Taking advantage of the mine’s location on prime lakeside real estate, every day the facility draws nearly 140 million gallons of water from below the surface of Seneca Lake to cool its computer farm. After it is used, the water is cycled back into the lake. Whereas Bathhouse was able to repurpose the heat emitted by its mining processes into warming its spa facilities, the water discharged back into Seneca Lake is usually nine to thirteen degrees warmer.

Although this temperature differential may seem marginal, activists argue that these higher temperatures will accelerate the lake’s existing problem of toxic cyanobacteria, commonly referred to as harmful algal blooms (HABs). Since 2017, the Finger Lakes, the group of glacially formed lakes that Seneca Lake belongs to, have been plagued by algal blooms, which thrive in warm waters. The effects can be devastating, turning lake waters the murky consistency of pea soup and making drinking and bathing in the water poisonous for both humans and animals. Algal blooms also respire oxygen, which can cause alterations in the lake’s dissolved oxygen levels, causing mass die-offs of the lake’s fish populations.

Seneca Lake is a two-million-year-old body of water that was carved into the earth through the movements of mile-long glaciers during the Ice Age. The longest and deepest of the Finger Lakes, it was a sacred body to local Iroquois, who believed it to be a bottomless expanse safeguarded by an elusive sea monster. Although Greenidge is just a blip in the lake’s timescale, surrounding communities are worried that continued pollution and environmental degradation at the hands of the plant will cause irreversible changes to the lake, infringing on its ability to continue serving as sustenance to life.

Greenidge’s fraught relationship with the lake didn’t just start with Bitcoin mining. The dumping of warm water back into the lake compounds decades of run-off waste pollution from the original coal plant. The legacy of the facility’s coal operations remains even today, with Greenidge earlier this year entering a settlement with the US Environmental Protection Agency to properly dispose of the coal-ash pond on its site.

Bitcoin and the wider mode of production in which it is embedded reproduce existing relationships of extraction, continuing the legacy of exploitative economic systems. The appropriation and thus warping of the hack as it is demonstrated here is perhaps best understood through the lens of what writer and researcher Theodora Dryer calls “settler computing.” Dryer defines settler computing as a “process of appropriating and reformulating space and time through algorithmic systems that reify settler colonial water policy and control.”

Extrapolated to Bitcoin’s model, reliant as it is on unchecked energy and, by extension, water consumption, the framework of settler computing allows us to understand just how the hack might be repurposed, if not weaponized, to reinforce spatial and temporal violence. Perhaps the abstraction of decentralization makes it easier to ignore questions of place. However, while proof of work is celebrated for its ability to optimize and eliminate speed bumps like human error and the risk of trust—sticky vestiges of other economic systems—it is nevertheless designed according to very human settler-colonial ideals around resources and the environment. That Bitcoin is reproducing conditions of scarcity in this case, making Seneca Lake inhospitable to life, is inherent to the design of its algorithm.

Riot USA’s Manifest Destiny

The race to mine Bitcoin has been likened to the Gold Rush. States like Texas, Pennsylvania, and New York have experienced an influx of miners looking to set up shop where energy costs are low, and regulations are almost nonexistent. This pattern has only been exacerbated in recent years by China’s 2021 Bitcoin-mining ban, which sent around 75 percent of the world’s miners packing. With the Bitcoin Gold Rush has come a digital manifest destiny.

Rockdale, Texas is home to not one but two commercial mining enterprises: Riot Platforms, the largest Bitcoin mine in North America; and Bitdeer. Located less than a mile apart, they sit on the site of a former Alcoa aluminum plant. A rustbelt city, Rockdale initially welcomed Bitcoin miners, who promised jobs to a local population that had over the past few decades weathered the collapse of the town’s coal industry, the closure of the aluminum plant, and most recently the bankruptcy of a hospital. In addition to a declining economy and rising poverty rates, faucet water in the town runs rust brown due to outdated and corrosive pipes. Hopeful of more jobs and an influx of cash that might go toward providing clean drinking water, residents initially welcomed cryptominers.

In the years since, however, the town as well as surrounding communities have struggled to make nice with their new neighbors. Unlike Greenidge, the mines don’t produce their own power; rather, they tap into Texas’s already unpredictable electric grid. The state continues to grapple with blackouts, especially during extreme weather. With the promise of generating new economic activity, Bitcoin miners secured a controversial deal with the state, which offers to pay cryptominers in exchange for shutting down their computers during peak electricity demand to avoid overloading power grids. In 2023, during Texas’s hottest summer on record, Riot Platforms earned more government money during the month of August for abstaining from mining than from Bitcoin, netting tens of millions of dollars in public money for power curtailment.

Despite widespread outcry from residents across Texas, Bitcoin’s westward expansion continues. Currently, Riot Platforms is building what would be the world’s largest Bitcoin mine in the city of Corsicana, outside Dallas. The mine is projected to consume up to 1.5 million gallons of water a day for its cooling systems, a worrying statistic for a region facing chronic drought. In recent years, the region has seen heat waves that have dried up water resources and destroyed the local agriculture industry, with farmers losing their crops and ranchers selling their herds due to a lack of access to grazeable land.

With its promise of employment and economic revitalization, and through tax abatements and other government financial incentives, Riot Platforms and its fellow cryptocurrency miners have asserted a right to space, water, and energy in the name of Bitcoin, infringing on the livelihoods of the communities and ecosystems they take hostage. The original Gold Rush of the 1840s was defined by a mentality of biblical conquest and settlers’ divine right to land. While the Bitcoin rush isn’t necessarily ordained by God, its claim to land is rooted in a hacker orthodoxy, one that Richard Barbrook and Andy Cameron define in their canonical 1996 essay, The Californian Ideology, as a bizarre combination of “technological determinism and libertarian individualism.” Here, expansionism is validated through the financial freedom offered by the hack. However, this narrow viewpoint of freedom has its own consequences in its infringement on the human right to water.

Conclusion

Toni Morrison once compared the act of imagining to the Mississippi River’s predilection for flooding: “All water has a perfect memory and is forever trying to get back to where it was.” Here, leakage serves as a persistent archive, a ritual return that refuses burial. If the act of imagining is bound up with memory, as Morrison says, the practice of building new worlds is inextricable from history.

Daylighting Bitcoin’s relationship with water and excavating its negotiations with existing water infrastructures is a broader study in the conditions of water scarcity. However, within postcolonial scholarship, scarcity has been shown to be a construction of colonialism. Scarcity is rooted in an understanding not of what is there but what is missing. Understanding water to be a deficient resource, scarcity is used as an apparatus to validate state intervention in order to manage apportionment, allocation, and optimization. In truth, the water scarcity that Bitcoin augments is one rooted in a history of damming, irrigated commercial agriculture, and colonial water management policies.

Nonetheless, Bitcoin falls short of the possibilities offered within abstraction, leaning on a mode of production that reproduces legacies of extraction. That being said, the failures of Bitcoin should not negate the alternate worlds others are attempting to usher in through the frameworks offered by cryptocurrency. The most obvious example is Ethereum, one of the top traded cryptocurrencies, which in response to proof of work’s environmental toll overhauled its system in 2022 to eliminate mining in exchange for the less energy intensive “proof of stake.”

The more pressing question here is: What is abstraction (and by extension the hack) in a world rapidly remade by climate change—a world that demands a heightened attentiveness to the physical and material? In A Hacker Manifesto Wark writes,

The interest of the hacker class in the production of production, in the abstraction of the world, the expression of the virtuality of nature, can be brought into accord with the needs and interests of nature itself. But this too is only a step toward another history. A history where nature expresses itself as neither object nor subject but at its infinite virtuality.

How can the hack better attune us to, as Wark says, the needs and interests of nature itself?

In a recent essay, eco-technology researcher Austin Wade proposes the blockchain as a way to restore autonomy and agency to nonhuman entities. The idea is “infrastructural animism,” which decenters the human and builds upon Indigenous practices of water and land sovereignty. Already, within the legal landscape, Indigenous-led rights-of-nature movements have sought to create policy that would protect the autonomy of rivers and forests. For example, movements in New Zealand and Canada have fought for the right to personhood of natural entities.

Wade asks: What would it look like if instead of proof of work, we had “proof of rehydration,” where stewards, rather than “miners,” are awarded credits for infrastructural projects that aid in the replenishment of aquifers? Or proof of habitat restoration? The system would employ sensing technologies that tie the distribution and value of ecoCredits or currency to the ecological health of the entity. By reconfiguring bodies of water into what Wade calls “ecological institutions,” decentralized protocols might be used to foster new modes of identity, governance, and coexistence. In restoring agency to nonhuman identities, we might shift our frameworks away from scarcity to those of livingness.

Perhaps, then, abstraction offers a way for us to come closer to nature. Rather than alienating us from one another and our environments, virtuality provides new means for communing with the more-than-human world. Centering ideas of reciprocity and regeneration, rather than domination and extraction, carries the promise of more porous technologies—ones that can adapt and account for the aforementioned leakages and the histories they carry.

Fuente