2022-01-28 18:15:00
Governor Greg Abbott has turned to an unlikely corner to help shore up the state’s lagging power grid, turning to Bitcoin miners to help stabilize the Texas power grid. Governor Abbott has made several outreaches to the crypto industry, inviting them to Texas.
This comes at a time when several other jurisdictions have outlawed Bitcoin mining because of the stress it adds to the power grid.
Stabilizing The Electricity Grid
The Texas governor believes that Bitcoin miners could help stabilize the Texas electricity grid, which has been struggling to keep up as demand rises. While Bitcoin mining has come under considerable flak for being energy-intensive, there is a growing list of politicians such as Senator Ted Cruz and Austin Mayor Steve Adler who view it as a solution to several energy-related problems.
Mayor Abbott has joined this growing list of politicians, hoping that with the advent of Bitcoin miners and Bitcoin mining into the state, power providers will build additional infrastructure given the increase in demand, which could benefit everyone.
A Teetering Grid
Voters in Texas have not been too pleased with the handling of the Texas electricity grid, which has been unable to provide enough power, and enough affordable power when consumers have required it the most. Just last winter, there were several power outages in the state, which led to hundreds of deaths.
While Abbott’s proposal is risky, it is one that miners have been promoting for years. Inviting Bitcoin miners to the state creates a significant financial incentive to create infrastructure and help in the production of more energy. On the downside, it invites even more stress and demand on an already stretched power grid.
Miners Promise Cooperation
Governor Abbott is counting on the fact that Bitcoin miners would pause operations when ordered by the state to do so, particularly when there is a surge in demand. This approach would be similar to that of Iran, which has announced a ban on Bitcoin mining during the winter to prevent any more crippling blackouts.
While critics have argued that Bitcoin miners cannot afford to stop and start their mining operations for extended periods, miners do seem to be on board with the idea. Two prominent Bitcoin miners have already extended support, vowing to obey the governor’s request to pause operations when required.
Lee Bratcher, President of the Texas Blockchain Council, stated,
“It’s really a healthy dynamic that brings tax revenue, brings job creation, and also is a grid strengthening mechanism. Governor Abbott’s been very supportive.”
A Growing Operation
According to data gathered by the Texas Blockchain Council, there are 27 mining operations currently based in Texas, with several more in the pipeline, including Foundry, which is backed by the Digital Currency Group. Texas has seen significant growth in mining operations thanks to other countries which have imposed a blanket ban on mining operations. The biggest crackdown occurred in China, once the center of mining operations. After the Chinese crackdown, many miners moved operations to the United States.
Other countries such as Kosovo have also outlawed Bitcoin mining, citing the additional strain on the energy grid.
BTC Slowly Shifting To Renewables
The migration of Bitcoin mining operations to the United States has also seen BTC slowly switch to renewable energy, with miners in the US dependent on renewable power as compared to the coal-fired power plants in China. This has proved to be a counter to arguments against the Bitcoin mining industry, especially after Republican party members such as Senator Ted Cruz had stated that he would like to see Texas become a cryptocurrency hub.
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.
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