In an interview with CoinDesk, Kraken’s Chief Technology Officer (CTO) revealed that the crypto exchange is considering using nuclear energy to meet demands for the company’s services. This comes as Kraken projects crypto will continue to go mainstream and decentralized finance (DeFi) will experience a spike in activity.
Vishnu Patankar, the CTO, said crypto’s around-the-clock nature means that the exchange needs a constant supply of energy, particularly as it facilitates a larger proportion of global trading volumes. The use of nuclear energy will allow Kraken to scale its business in terms of energy supply and latency.
According to the interview, Kraken will not be building its own reactors. Instead, it will contract with energy providers to use small modular reactors (SMRs) to supply energy to the company’s data centers. SMRs are considerably smaller than traditional nuclear reactors, can blend in with existing infrastructure, and produce up to 300 Megawatts of energy.
Patankar said that having a nuclear power backup means that the exchange can continue to operate even if there is a disruption to the local power supply. While renewable energy sources like wind and solar are useful, the current state of those technologies makes them less dependable and prone to power outages.
Kraken is currently looking at nuclear energy options in North America and Europe, two continents where it has considerable market share. According to the International Atomic Energy Agency, there are only four SMRs currently in production, located in Argentina, China, and Russia.
Tech Companies Cause Energy Demands to Rise
The increasing digitization of the world has led to a steep rise in the demand for electricity. A Wells Fargo analysis paper predicted that, by 2030, artificial intelligence will add 323 Terawatts of electricity demand in the United States (seven times greater than in New York City). Data centers will account for 8% of all electricity usage in the country by that same year.
Major tech companies are already exploring energy options that are climate-friendly, and nuclear seems at or near the top of the list. This year, Amazon bought a nuclear-powered data center in Pennsylvania. In October 2023, Microsoft put out a job posting for a “Principal Program Manager, Nuclear Technology.” Google has explored initiatives involving clean energy, including nuclear.
These companies face many of the same challenges as Kraken: a need for reliable, constant energy, data centers that need to be powered 24/7, and a client base spread all around the world. Energy, especially from a source that doesn’t pollute, is at a premium.
Although the public has a negative perception of nuclear energy, it meets those characteristics. It is reliable where most renewable energy sources are not and it doesn’t pollute, unlike natural gas, coal, or other fossil fuel energy sources. According to experts, the technology has come a long way too, making nuclear reactors safer than they were during past decades.
Whether Kraken will ultimately decide to rely on nuclear energy is anyone’s guess. But it is certainly right about one thing: Crypto is going mainstream, it never sleeps, and energy demands will continue to rise.
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