Texas is the second largest state in the United States, known for its southern hospitality, and it is embracing hordes of Bitcoin (Bitcoin) The recent influx of miners into the area.The following China cracks down on cryptocurrency mining In May, some Bitcoin mining companies have moved to Lone Star State to start operations.
However, this is not surprising.Texas is probably Ideal location for Bitcoin mining, For obvious reasons, such as its deregulated power grid, increased renewable energy and political leaders that openly support encryption.Texas Governor Greg Abbott recently Tweet He is excited about how Texas can become the next “crypto leader” because of the recent addition of cryptocurrency kiosks in grocery stores.
However, while all these factors make Texas attractive to Bitcoin miners who wish to open a shop, rural communities seeking economic growth have become another less discussed feature that is attracting mining companies to Texas .
Texas County welcomes Bitcoin miners to boost economy
Chad Harris, CEO of Whinstone Inc., the largest crypto facility operator in North America, told Cointelegraph that his team came to Rockdale, Texas after reading the news of the failure of China’s Bitmain mining facility in 2019 Create Whinstone:
“As soon as we came to Rockdale, we didn’t want to leave. We built Whinstone in 183 days. We started construction in January 2020 and opened the facility in June 2020. We now own three buildings, 300 Megawatt substation, and 400 megawatts of new buildings are being expanded.”
Although the wind-rich and deregulated power grid in Texas helped the company grow, Harris also attributed the success of Wheatstone to Rockdale, a small city in Miram County with a population of close to 6,000. .
Although this may not be obvious, Harris shared that in addition to the cost of electricity in Texas, Wheatstone’s biggest benefit is the state’s labor force. “Whinstone is different from other mining companies because we have our own employees, consisting of 120 employees, and all employees have paid healthcare and 401k benefits.” He added, “We also use Texas employee incentives , Sent our workers to Temple College in Texas for training and certification in the fields of construction and human resources.”
In total, Texas is made up of 254 counties, with a population ranging from more than 4 million to just over 100 in some areas. Although Texas offers many local development plans, Promote The influx of crypto mining companies is having a real impact in the economies of certain communities.
For example, Milam Country Judge Steve Young told Cointelegraph that Whinstone has become an integral part of Rockdale and Milam counties. He explained, “Whinstone is committed to becoming part of the community by participating in local activities.” Young further pointed out that Harris and the founding team of Whinstone came to Miram County with very little money, but with courage and determination, they formed the largest in North America. Bitcoin mining business.
Although Whinstone may be one of the first Bitcoin mining facilities to achieve this goal, others are following suit. Peter Wall, CEO of Argo Blockchain, told Cointelegraph that Argo has broken ground on a highly anticipated 200 MW cryptocurrency mining facility focused on renewable energy in Dickens County, Texas.
Wall pointed out that Argo had Initially interested in mining encryption Due to the abundance of renewable energy nearby, Argo is able to host renewable energy generation at this location. “Since there is no local load, we are improving the economics of renewable generators in the area and allowing more renewable energy development,” Wall commented.
Equally important, Wall explained that Dickens County is a “qualified opportunity zone”, which means the area is a struggling community experience Difficult economic conditions. Wall details:
“Argo’s business in Dickens County will support the local community. We believe we can revitalize the community by creating jobs and will continue to explore opportunities to further support and develop the county, while making Dickens County a redefining energy source to achieve a greener, The leader of a cleaner, renewable future.”
Wall stated that establishing Argo’s mining business will provide huge growth opportunities for Argo and Dickens County communities. Wall shared that the Argo facility is expected to be completed in the first half of 2022.In addition to building in West Texas, Argo has also started Apply for an IPO In the U.S.
Joining the ranks of Whinstone and Argo, Bitcoin mining operations giant Core Scientific told Cointelegraph that it will acquire Blockcap, a BTC mining company headquartered in Austin, Texas. Core Scientific is also set to Publicly listed on NASDAQ soon.
Darin Feinstein, co-founder of blockchain infrastructure company Core Scientific, told Cointelegraph that the company was attracted to Texas for all practical reasons, including large amounts of land, renewable energy, and sustainable resources. However, the Texas community is also a major factor in Core Scientific’s expansion of its business to Texas.
Feinstein pointed out that Texas Governor Abbot has created “a world-class business-friendly environment that not only encourages entrepreneurship and technology, but also has always welcomed the blockchain industry.” According to Feinsteint, like Governor Abbot’s A currency-friendly leader is a necessary condition for the deployment of funds.
This is important considering the amount of funds required for the Bitcoin mining business.For example, Digiconomist’s Bitcoin Energy Consumption Index estimated A Bitcoin transaction requires 1,720 kilowatt-hours to complete, which is equivalent to nearly 59 days of electricity in an average American household. “Crypto mining facilities require a lot of capital, and when it comes to business partners and long-term growth, you have to make the right choice,” Harris said.
Given its long-term success, the Lone Star State’s power operator—the Texas Electric Reliability Council, or ERCOT—has started paying Wheatstone for an agreement to stop purchasing power during periods of increased energy demand. It usually happens during the hot summer in Texas. Harris explained:
“Historically, in the ERCOT market in the past few years, depending on the grid conditions, we expect that there will be 50-72 power outages between June and September. Think of Bitcoin miners as a virtual power plant. Power is provided within 5 seconds of clicking a button (by not taking power). Traditional power generation providers may take several hours to power on to support additional demand.”
Texas welcomes, but mining industry faces new challenges
Even with a pleasant environment and seemingly abundant natural resources, the major Bitcoin mining companies currently coming to Texas will face new challenges exacerbated by the COVID-19 pandemic.
According to Harris, the biggest challenge currently facing the crypto mining industry is the shortage of commodities. “Commodities like transformers, wires and other parts are really hard to buy right now. We are in a leading position and started ordering supplies 6-8 months ago to expand Wheatstone this summer. We last October Ordered everything.”
Fed’s latest Beige Book survey Established Companies attribute the COVID-19 disruption in production and supply chain logistics to shortages of commodities such as agricultural products and construction materials and soaring prices. “Product delivery for prefabricated buildings will be completed in 32 weeks instead of 14 weeks. The large transformers in the substation will take 64 weeks to arrive. Today, every company that wants to build an encrypted mining facility has problems with delivery materials,” Harry Said.
Although this is the case, it is important to note Cryptocurrency mining is still largely decentralizedTherefore, major Bitcoin mining facilities are not the only participants who contribute to Bitcoin’s hash rate.In fact, the data show Hash rate distribution is increasingly beneficial to small anonymous miners.
In addition, large mining companies have also benefited from China’s ban on Bitcoin mining. Sam Tabar, chief strategy officer of the publicly listed miner Bit Digital, told Cointelegraph that China’s Bitcoin mining ban resulted in unexpectedly giving the United States a gift. “Now, with a lot of capital investment, energy innovation and job opportunities, the holy land of the Bitcoin generation has moved from China to North America.”