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01 / 05
Bitcoin Brought Electricity to Countries in the Global South

Blog Post | Adoption of Technology

Bitcoin Brought Electricity to Countries in the Global South

It won’t be the United Nations or rich philanthropists that electrifies Africa.

Summary: Energy is indispensable for societal progress and well-being, yet many regions, particularly in the Global South, lack reliable electricity access. Traditional approaches to electrification, often reliant on charity or government aid, have struggled to address these issues effectively. However, a unique solution is emerging through bitcoin mining, where miners leverage excess energy to power their operations. This approach bypasses traditional barriers to energy access, offering a decentralized and financially sustainable solution.


Energy is life. For the world and its inhabitants to live better lives—freer, richer, safer, nicer, and more comfortable lives—the world needs more energy, not less. There are no rich, low-energy countries and no poor, high-energy countries.

“Energy is the only universal currency; it is necessary for getting anything done,” in Canadian-Czech energy theorist Vaclav Smil’s iconic words.

In an October 2023 report for the Alliance for Responsible Citizenship on how to bring electricity to the world’s poorest 800 million people, Robert Bryce, author of A Question of Power: Electricity and the Wealth of Nations, sums it as follows:

Electricity matters because it is the ultimate poverty killer. No matter where you look, as electricity use has increased, so has economic growth. Having electricity does not guarantee wealth. But its absence almost always means poverty. Indeed, electricity and economic growth go hand in hand.

To supply electricity on demand to many of those people, especially in the Global South, grids need to be built in the first place and then have enough extra capacity to ramp up production when needed. That requires overbuilding, which is expensive and wasteful, and the many consumers of the Global South are poor.

Adding to the trouble are the abysmal formal institutions of property rights and rule of law in many African countries, and the layout of the land becomes familiar: corruption and fickle property rights make foreign, long-term investments basically impossible; poor populations mean that local purchasing power is low and usually not worth the investment risk.

What’s left are slow-moving charity and bureaucratic government development aid, both of which suffer from terrible incentives, lack of ownership, and running into their own sort of self-serving corruption.

In “Stranded,” a long-read for Bitcoin Magazine, Human Rights Foundation’s Alex Gladstein accounted for his journey into the mushrooming electricity grids of sub-Saharan Africa: “Africa remains largely unable to harness these natural resources for its economic growth. A river might run through it, but human development in the region has been painfully reliant on charity or expensive foreign borrowing.”

Stable supply of electricity requires overbuilding; overbuilding requires stable property rights and rich enough consumers over which to spread out the costs and financially recoup the investment over time. Such conditions are rare. Thus, the electricity-generating capacity won’t be built in the first place, and most of Africa becomes dark when the sun sets.

Gladstein reports that a small hydro plant in the foothills of Mount Mulanje in Malawi, even though it was built and financed by the Scottish government, still supplies exorbitantly expensive electricity—around 90 cents per kilowatt hour—with most of its electricity-generating capacity going to waste.

What if there were an electricity user, a consumer-of-last-resort, that could scoop up any excess electricity and disengage at a moment’s notice if the population needed that power for lights and heating and cooking? A consumer that could co-locate with the power plants and thus avoid having to build out miles of transmission lines.

With that kind of support consumer—guaranteeing revenue by swallowing any excess generation, even before any local homes have been connected—the financial viability of the power plants could make the construction actually happen. It pays for itself right off the bat, regardless of transmissions or the disposable income of nearby consumers.

If so, we could bootstrap an electricity grid in the poorest areas of the world where neither capitalism nor central planning, neither charity worker nor industrialist, has managed to go. That consumer of last resort could accelerate electrification of the world’s poorest and monetize their energy resilience. That’s what Gladstein went to Africa to investigate the bourgeoning industry of bitcoin miners electrifying the continent.

Bitcoin Saves the World: Energy-Poverty Edition

Africa is used to large enterprises digging for minerals. The bitcoin miners springing forth all over the continent are different. They don’t need to move massive amounts of land and soil and don’t pollute nearby rivers. They operate by running machines that guess large numbers, which is the cryptographic method that secures bitcoin and confirms its transaction blocks. All they need to operate is electricity and an internet connection.

By co-locating and building with electricity generation, bitcoin miners remove some major obstacles to bringing power to the world’s poorest billion. In the rural area of Malawi that Gladstein visited, there was nowhere to offload the expensive hydro power and no financing to connect more households or build transmission lines to faraway urban areas: “The excess electricity couldn’t be sold, so the power stations built machines that existed solely to suck up the unused power.”

Bitcoin miners are in a globally competitive race to unlock patches of unused energy everywhere, so in came Gridless, an off-grid bitcoin miner with facilities in Kenya and Malawi. Any excess power generation in these regions is now comfortably eaten up by the company’s onsite mining machines—the utility company receiving its profit share straight in a bitcoin wallet of its own control, no banks or governments blocking or delaying international payments, and no surprise government currency devaluations undercutting its purchasing power.

No aid, no government, no charity; just profit-seeking bitcoiners trying to soak up underused energy. Gladstein observes:

One night during my visit to Bondo, Carl asked me to pause as the sunset was fading, to look at the hills around us: the lights were all turning on, all across the foothills of Mt. Mulanje. It was a powerful sight to see, and staggering to think that Bitcoin is helping to make it happen as it converts wasted energy into human progress. . . .

Bitcoin is often framed by critics as a waste of energy. But in Bondo, like in so many other places around the world, it becomes blazingly clear that if you aren’t mining Bitcoin, you are wasting energy. What was once a pitfall is now an opportunity.

For decades, our central-planning mindset had us “help” the Global South by directing resources there—building things we thought Africans needed, sending money to (mostly) corrupt leaders in the hopes that schools be built or economic growth be kick-started. We squandered billions in goodhearted nongovernmental organization projects.

Even for an astute and serious energy commentator as Bryce, not once in his 40-page report on how to electrify the Global South did it occur to him that bitcoin miners—the very people who are turning the lights on for the poorest in the world—could play a crucial role in achieving that.

It’s so counterintuitive and yet, once you see it, so obvious. In the end, says Gladstein, it won’t be the United Nations or rich philanthropists that electrifies Africa “but an open-source software network, with no known inventor, and controlled by no company or government.”

Blog Post | Cost of Material Goods

The Good Old Days Were Really Expensive

Most things are more abundant and affordable today.

If you had a dime in 1900, you could buy a 1-ounce Hershey chocolate bar and a 6.5-ounce bottle of Coca-Cola. It sounds like those were happy days indeed. That is until you look at wages, which were around 14 cents an hour for blue-collar workers.

At Walmart today, a 1.55-ounce Hershey bar costs $1.17 and a 1.25-liter bottle (42.27 ounces) of Coke is $1.52. Blue-collar workers earn closer to $36.15 an hour in compensation.

We buy things with money but pay for them with our time. Money prices are expressed in dollars and cents, while time prices are expressed in hours and minutes. A time price is simply the money price divided by hourly income.

In 1900, it took more than 21.4 minutes to earn an ounce of chocolate and 3.3 minutes for an ounce of Coca-Cola. By 2023, the chocolate time price had fallen to 1.25 minutes, and sodas were down to 0.06 minutes (3.58 seconds).

Chocolate cost fell 94.2 percent while cola cost fell 98.2 percent. For the time required to earn 1 ounce of chocolate in 1900, you get 17.1 ounces today, and for the time required to earn 1 ounce of Coca-Cola in 1900, you get 55.2 ounces today. Chocolate is 1,611 percent more abundant while cola is 5,425 percent more abundant.

Things can get more expensive and more affordable at the same time. This is why you must always compare prices to wages to see the true price, which is how much time things cost you.

This article was published at Gale Winds on 3/19/2024.

Blog Post | Energy Prices

Where Is Gasoline the Most Affordable?

Remember that it’s the time price, not the money price, that counts.

Summary: The affordability of gasoline varies significantly worldwide due to varying taxes and subsidies. Analyzing the GDP per hour worked against the money price per gallon shows that the United States emerges as the most affordable country for purchasing gasoline, even compared to nations where gasoline prices are heavily subsidized by the government.


According to GlobalPetrolPrices.com, the average price of gasoline around the world is USD5.03 per gallon. However, there is substantial difference in these prices among countries due to the various taxes and subsidies for gasoline. All countries have access to the same petroleum prices of international markets, but countries do not all impose the same taxes. As a result, the retail price of gasoline varies significantly.

Graph displays the gasoline price per gallon in US dollars in various countries

The money price of 16 selected countries ranges from $2.26 in Russia to $8.55 in Denmark. But what about the time price? To calculate the time price, we first calculated the GDP per hour worked in each country. The data to calculate this ratio come from the World Bank and the Conference Board.

Graph displays the GDP per hour worked in various countries

We then divided GDP per hour worked by the money price per gallon. This gave us the gallons of gasoline that one hour of work would buy in each country:

Graph displays the gallons of gasoline per GDP per hour worked in various countries

We also divided the nominal price per gallon by GDP per hour worked to get the minutes required per gallon:

This chart illustrates how much more expensive relative to the US the other 15 countries are in terms of time price:

Chart displays the cost in time price of gasoline in 15 countries

Of the 16 countries analyzed, the US is by far the most affordable place to buy gasoline. There are other countries where gasoline is more affordable, but the gasoline price in those countries is heavily subsidized by government.

Tip of the Hat: Jeremy Horpendahl

This article was published at Gale Winds on 4/1/2024.

Blog Post | Air Transport

Flying Abundance (And Safety) Has Increased Dramatically

Get 10.8 flights from New York to London today for the time price of one in 1970 and be 80.4 times safer.

Summary: Since the Wright brothers’ pioneering flight in 1903, the aviation industry has made remarkable strides in safety, affordability, and accessibility. Comparing flight prices from 1970 to today reveals a staggering 90.8 percent decrease in the time price of flying, with transcontinental flights now affordable for the average person. Additionally, advancements in aviation technology have made flying dramatically safer today than it was in 1970, and are likely to improve flying safety in the future.


The Wright brothers launched the era of aviation on December 17, 1903, with a 12-second flight. Since then, aeronautical engineers and market innovators have made the experience safer, faster, and much more affordable.

For example, in 1970 the price for a roundtrip ticket from New York to London was $550. Blue-collar workers at the time were earning around $3.93 an hour in compensation (wages and benefits). This suggests a time price of around 140 hours.

Today, the ticket price has dropped to around $467. Blue-collar workers are now earning closer to $36.15 an hour, putting the time price at 12.9 hours. The time price has fallen by 90.8 percent: for the time required to earn the money to buy one flight in 1970, you can get 10.8 flights today.

Flying abundance has increased by 980 percent, compounding at an annual rate of 4.5 percent over the last 54 years. During this same period the global population increased by 4.3 billion (117 percent), from 3.7 billion to more than 8 billion. Every 1 percentage point increase in population corresponded to an 8.4 percentage point increase in flying abundance.

Now transcontinental flights are affordable for almost everyone. Free-market entrepreneurial capitalism isn’t about making more luxuries for the wealthy, it’s about making luxuries affordable for the average person.

While it is true that the 1970s flights may have had roomier cabins and better dining, flying today is dramatically safer. The Aviation Safety Network tracks airline accident data. Revenue passenger kilometer (RPK) is a standard metric used in aviation. Using this data, Javier Mediavilla plotted the ratio of fatalities per trillion RPK from 1970 to 2019 using five-year averages. The ratio decreased by 98.76 percent, from 3,218 to 40, during this 49-year range. Flying is more than 80.4 times safer today than in 1970, and safety has been improving at a compound rate of around 9.37 percent a year.

Considering both the time price and safety, flying has become 868 times more abundant since 1970 (10.8 x 80.4 = 868). If there had been no innovation in flying since 1970,  New York to London airfare would be around $5,059 today. Only the rich could afford transatlantic flights in 1970.

The 3,442-mile flight takes around seven hours. The supersonic Concorde could fly it in less than three. While there are no commercial supersonic flights available today, Boom Supersonic, a private company based in Colorado, aims to bring them back to US airlines by 2029. Perhaps spending half as much time on flights will allow people to use their most valuable resource for other value-creating activities.

This article was published at Gale Winds on 3/26/2024.

World Bank | Water Use

The GCC’s Journey Towards Water Security

“Thanks to innovation driven by the Gulf Cooperation Council (GCC) countries, notably advancements in membrane technologies and energy efficiency, the price of desalinated water has plummeted from US$5.00 per cubic meter in the 1980s to as low as US$0.40-0.50 in recent projects. This is making desalination increasingly affordable for countries worldwide.

Beyond desalination, the GCC countries are implementing diversified water management strategies to manage water demand. One of the most important areas is the reduction of ‘non-revenue water’ (NRW) — physical and commercial losses of water.”

From World Bank.