September 28, 2022

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Crypto Miners Keep Moving To The USA – Targeting Texas

The status and future of cryptocurrency is highly uncertain and its ultimate fate is likely...

The status and future of cryptocurrency is highly uncertain and its ultimate fate is likely to be driven not only by technological development but by policy decisions made by governments around the world. The recent crackdown on digital currency in China, in particular, has sent cryptocurrency prices reeling and led to an exodus for crypto miners who need a friendlier alternative. In fact, the crackdown in China has led to a widespread assumption that China is moving towards eventually outlawing digital currency that might compete with the digital Yuan. Although it’s not very clear what China’s long-term agenda regarding cryptocurrency is, it has become obvious that the Asian nation is no longer an optimal place for miners to set up operations.

Crypto Mining Sentiment

While the crackdown in China has caused a mass exodus of crypto miners, the political attitudes in other parts of the world are becoming friendlier to the fledgling industry. Many miners have relocated to the United States, Canada, and Kazakhstan. El Salvador has even taken the extraordinary step of classifying Bitcoin as a legal tender for transactions in the country, a move which, if successful, may kickstart a movement towards adopting cryptocurrencies for day-to-day commerce across the world. This may be especially useful in some regions where the local government-issued currency is less secure than cryptocurrency and may suffer from issues with extreme volatility.

Texas Becomes A Hotspot

Recently, the United States and specifically the state of Texas has emerged as an attractive alternative for crypto miners. This is because Texas has a friendly attitude when it comes to this emerging technology and has favorable energy policies. This is a huge boon for an industry that consumes enormous amounts of power.

The structure of the power grid in Texas is highly decentralized and enables consumers to purchase electricity from a specific source and sell the excess back to the grid during peak hours. As a result, overall energy prices in Texas are significantly lower than elsewhere in the United States and are among the cheapest in the world.

This setup not only allows crypto miners to reduce their overall energy costs dramatically but enables them to purchase their energy from renewable and carbon-neutral sources if they so choose. Considering that the carbon footprint of cryptocurrency mining has been one of the most significant criticisms of the industry in recent years, this serves as a potential way to ward off some of the controversies and make crypto operations more environmentally sustainable. Carbon neutral crypto may be a potential selling point for investors who are concerned about the environmental impacts of the industry and are looking for a cleaner way to invest in cryptocurrency.

All of this presents a potential opportunity for jurisdictions that may wish to attract the nascent crypto mining industry. Texas Governor Greg Abbott has been particularly enthusiastic about building the industry in his state, stating on Twitter that:

“Blockchain is a booming industry that Texas needs to be involved in”

and recently signing legislation to create a regulatory framework for the industry. The enthusiasm of relocating to Texas has not been without some concern, in particular, the issue has been raised about the effects of large numbers of crypto miners on the local power grid. This has been a particularly strong concern given the recent failure of large portions of the Texas power grid during severe storms this past winter.

In some locations, local governments have struggled to expand power infrastructure to accommodate the increased demand from crypto miners. This has raised the concern that an influx of crypto miners might push the grid past its breaking point.

Recent Developments

Recently there have been major shifts and shakeups within the crypto mining industry. SW Holdings Inc. (OTC: ISWH) has signed an agreement with Bitmain Technology, a major producer of crypto mining hardware to set up an operation in Georgia. Bitfarms Ltd. (NASDAQ: BITF) has also set up crypto mining operations using almost exclusively hydroelectric power and has taken steps to become the largest publicly traded crypto mining firm.

Other companies making moves to set up mining operations include Majic Wheels Corp. (OTC: MJWL) and Hut 8 Mining Corp. (NASDAQ: HUT) which are both in the process of scaling up operations. Voyager Digital (OTCQX: VYGVF) has partnered with Usio Inc. (NASDAQ: USIO) to provide payment solutions for merchants interested in using cryptocurrency to make transactions.

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Source: visionary-finance.com