Texas lures Bitcoin miners from China despite failing energy grid

Texas is bracing itself for an influx of displaced Chinese Bitcoin miners as the state continues to grapple with overloaded energy grids, reports CNBC.

As it stands, China is by far the largest Bitcoin mining hub. The country has historically boasted as much as 75% of the world’s hashrate.

However, after Beijing announced new crackdowns on crypto last month, “the Great Mining Migration” has local industry participants headed elsewhere.

Protos previously relayed sentiment of crypto miner BTC.TOP chief Jiang Zhuoer, who posited that North America and Europe will soon lead global Bitcoin hashrate.

In the end, Chinese hashpower will flow abroad just like the Exchanges did in 2017, China will play a less significant role in the global hashpower distribution.

— Jiang Zhuoer BTC.TOP (@JiangZhuoer) May 24, 2021

Echoing Zhuoer, one industry insider told CNBC that Bitcoin miners in China are weighing moving operations to the US, Eastern and Northern Europe, or Central Asia.

But Texas’ bid is buoyed by Bitcoin-friendly politicians.

State governor Greg Abbott even recently boasted Texas was “open for crypto business.”

Texas’ Bitcoin miners could be first to power down

Despite the array of suitable locations — including bordering Kazakhstan — CNBC notes Texas offers both renewable energy and deregulated grids, making the state attractive to exiled Bitcoin miners.

But Texas’ energy providers suffered outages in the past week due to soaring demand amid unusually high temperatures.

As a result, Texans were urged to dial back their power — particularly that spent on air conditioning.

Energy providers also left millions across the state without electricity in February due to incredibly severe winter storms.

Texas appears to have been a mecca for Bitcoin miners due to its cheap electricity. Of course, now we have a better idea of why the electricity was cheap (cutting lots of corners in the infrastructure).

— Angela Walch (@angela_walch) June 15, 2021

[Read more: Blockchain startup sells $25K rigs so farmers can mine crypto with bullshit]

Given Texas’ troubles with maintaining stable power, it’s not clear how the state could withstand demand for electricity typical of large Bitcoin mining operations.

Still, it could be that Bitcoin miners who relocate to Texas might be first to curtail their energy use when high demand sets in.

And so goes the grande experiment that is Bitcoin.

Prefer to listen to your news? The Protos Podcast delivers the week’s top stories every Friday.