As more and more displaced miners focus on Lone Star State, the recent crackdown on Chinese cryptocurrency mining has raised concerns about the potential impact of hash rate migration on the unreliable power market in Texas.
Texas’ abundant renewable energy resources and highly relaxed power grid make the state an obvious choice for relocating miners from China and elsewhere. As of 2019, 20% of Texas’s electricity is generated by wind energy.
speak NBC Finance ChannelBrandon Arvanaghi, a former security engineer at the cryptocurrency exchange Gemini, predicts that as miners seek to open stores, Texas will “have tremendous changes in the coming months”.
“We have governors like Greg Abbott of Texas pushing the mining industry. It will become a real industry in the United States, and it will be incredible,” he said, adding:
“Texas not only has the cheapest electricity in the United States, but also the cheapest electricity in the world.”
Nic Carter, the founding partner of Castle Island Ventures, told CNBC that half of the world’s computing power may eventually leave China and a new home is needed. He said:
“Every western mining host I know keeps their phones ringing. Chinese miners or miners settled in China are setting their sights on Central Asia, Eastern Europe, the United States and Northern Europe.”
But can the Texas Power Grid meet the challenge of providing power to the influx of more crypto miners? Texas Electric Reliability Council (ERCOT) Claim Texans controlled their electricity consumption during the recent heat wave, and many residents turned on air conditioners earlier this week.
As of Monday, approximately 12,000 megawatts of power generation capacity is offline-enough to power 2.5 million homes. ERCOT described the scale of the forced outage as “very worrying.”
Regulators warned that failure to comply with this requirement could result in a power outage of 69% of Texas in February, and a recurrence of widespread winter blackouts in which about half of the people were out of power.According to Buzzfeed, the power outage in February could cause as many as 700 The number of deaths in the state.
Angela Volch, a Texas research assistant at the Blockchain Technology Center at University College London, expressed her concerns on the share of electricity used for Bitcoin mining in Texas on Twitter and emphasized her family “It is required to reduce the use of air conditioners, not laundry machines and dryers, etc.”
Obviously, Bitcoin is not the only reason for this cluster*^% caused by our poor political leadership in Texas.
However, I would like to know the part of the grid it uses. Perhaps Bitcoin miners were the first to be shut down during a period of grid stress.
-Angela Walch (@angela_walch) June 15, 2021
However, Tierion CEO Wayne Vaughan responded that most of the electricity used to power the Texas mining operations contains stranded resources and “never reach your home to power your appliances.”
Others believe that the wholesale bitcoin mining business can actually alleviate the power problems in Texas, and the seasonal surge in power demand in Texas incentivizes miners to sell power back to the state’s grid, otherwise it will not be captured .
In September 2020, Layer1, a cryptocurrency miner backed by Peter Thiel in West Texas, reported that it made more than 700% In the case of a surge in demand in the summer, sell renewable electricity back to the grid.
Although the latest data on the global hash rate distribution is not available, the Bitcoin Power Consumption Index of the University of Cambridge (cellar) It is estimated that as of April 2020, China accounts for 65% of the world’s computing power.
Earlier this month, the regulatory authorities in western Xinjiang and Yunnan issued a notice Mandatory suspension of virtual currency mining companiesBECI estimates that these two regions account for 40% of the country’s hash rate.