The real-world costs of the digital race for bitcoin

Texas was gasping for electricity. Winter Storm Uri had knocked out power plants across the state, leaving tens of thousands of homes in icy darkness. By the end of Feb. 14, 2021, nearly 40 people had died, some from the freezing cold.

Meanwhile, in the husk of a onetime aluminum smelting plant an hour outside of Austin, row upon row of computers were using enough electricity to power about 6,500 homes as they raced to earn bitcoin, the world's largest cryptocurrency.

The computers were performing trillions of calculations per second, hunting for an elusive combination of numbers that bitcoin's algorithm would accept. About every 10 minutes, a computer somewhere guesses correctly and wins a small number of bitcoins worth, in recent weeks, about $170,000.

In Texas, the computers kept running until just after midnight. Then the state's power grid operator ordered...