States are at war to attract bitcoin miners, and new data suggests many of them are moving to New York, Kentucky, Georgia and Texas.
In the United States, bitcoin has a hash rate of 19.9%, or the total computing power of miners, in New York, 18.7% in Kentucky, 17.3% in Georgia, and 14% in Texas. It is the largest mining pool in North America and the fifth largest mining pool in the world.
Mining pools allow a miner to combine their hash power with thousands of other miners around the world, with dozens of options.
Castle co-founder Nick Carter said: “Island Ventures presented Foundry data on Friday at the Texas Blockchain Summit in Austin. “There’s a more efficient way to find out where mining is taking place in the United States.”
However, as Carter points out, not all US-based mining farms participate in the pool’s services, so the Foundry dataset takes into account all US mining hash rates. off course not. Riot Blockchain, for example, is one of the largest publicly traded mining companies in the United States with a significant presence in Texas. Hash rates are not taken into account in this dataset because they do not use foundry. This is why Texas’ mining presence is underestimated.
The dataset captures only a portion of the domestic mining market, but shows a national trend reshaping the debate over carbon footprint.
Many of the top-ranked states are hubs of renewable energy, and the fact that bitcoin has already started a story again among skeptics suggests that it is bad for the environment.
Carter acknowledges that the US mining industry is not entirely renewable, but miners here say they are far better able to choose renewable energy and buy offsets.
“The transition is definitely a net plus overall,” he said. “The hash rate move in the United States means that the carbon strength will be much lower.”
where did all the miners go
When Beijing decided to phase out all crypto miners this spring, nearly half of the bitcoin network went dark almost overnight. The network itself didn’t go green, but the event led to the largest bitcoin miner migration ever.
The Foundry dataset shows that the largest bitcoin mining operations are in some of the most renewable states. This is a game changer for the discussion about the environmental impact of bitcoin.
Big miners are tempted to switch to the world’s cheapest power sources because they compete in low-margin industries where variable costs are usually the only energy. It also becomes renewable energy.
Take, for example, New York, which leads the foundry rankings. According to the latest figures from the US Energy Information Administration, renewable energy accounts for a third of the state’s electricity generation.
New York counts nuclear power plants toward the 100% carbon-free electricity goal. And critically, New York produces more hydropower than any other state east of the Rocky Mountains. It was also the third largest hydroelectric power plant in the country.
In addition to New York’s chilly climate, the previously abandoned reusable industrial infrastructure has made it an ideal location for bitcoin mining.
For example, crypto mining company Coinmint operates a facility in New York. It features the facilities of the former Alcoa aluminum smelter in Massena, which harnesses the region’s abundant wind power and cheap electricity generated by dams along the St. Lawrence River. With a transformer capacity of 435 MW, the Massena site is billed as one of the largest bitcoin mining facilities in the United States.
This year, New York was considering a bill banning bitcoin mining for three years, so it was able to conduct an environmental assessment to measure greenhouse gas emissions. Since then, lawmakers have largely backed it.
“New York’s bitcoin mining is actually very low in carbon power given its hydraulic power, and as a result, if New York state bans bitcoin, the carbon power of the entire bitcoin network could increase. There is,” Carter said. he said. “That would be the exact opposite of what he wanted.”
Other states that have a substantial share of the US bitcoin mining industry include Kentucky and Georgia.
Beyond the fact that the governor of Kentucky is friendly to the industry, this year he passed a law providing some tax exemptions to crypto mining businesses, and the state is also known for its water and wind power.
Connecting the rig to the energy left behind by other means, such as a natural gas well, is another power source. Coal is also a big player in the energy mix, but many of the mining businesses there are turning to renewable energy.
and texas is
Texas may be in fourth place according to the foundry dataset, but many experts believe that Texas is currently the main jurisdiction of miners. Growth.
Leading bitcoin mining companies have set up shops in Texas, including Riot Blockchain, which owns 100 acres in Rockdale, and nearby Chinese miner BitDear.
According to The Block Crypto, orders for new ASICs, a special gear used to insert new bitcoins, indicate that thousands more machines will be delivered in Texas.
The Texas attractiveness comes down to a few big fundamentals: crypto-friendly lawmakers, deregulated power grids with real-time spot pricing, and perhaps most importantly, significant excess energy that is renewable. Access to natural gas, and trapped or flared.
According to Alex Brammer of Luxor Mining, a cryptocurrency pool designed for advanced miners, the regulatory red carpet deployed for miners also makes the industry highly predictable.
“It is a very attractive environment for miners to invest large amounts of capital in,” he said. “The large number of land transactions and power purchase contracts at various stages of negotiations are huge.”
Some miners connect directly to the grid to power the rig. ERCOT, the organization that operates the Texas grid, owns the cheapest, practical scale solar in the country at 2.8 cents per kilowatt hour. The grid is also rapidly adding wind and solar power.
“Nothing beats the cost of electricity in West Texas. Combined with an experienced electricity management company that can manage demand response programs, it is virtually unbeatable anywhere else in the world,” Braemer continues.
Deregulated grids are the most economical for miners because they can buy spot energy.
“They can participate in financial remittances, which means they stop buying electricity when prices go up, so they are more flexible when operating in the spot market,” Carter explains. Growth.
Another major energy trend in Texas’ bitcoin mining business is the use of “left-behind” natural gas to power rigs.
According to Carter, if fully harnessed, Flare Gas could power 34% of today’s bitcoin network in Texas alone. This makes Texas a clear leader in bitcoin mining not only in the United States but in the world.