Greenidge: The Bitcoin Mining Facility at the Center of a Political Battle

Greenidge: The Bitcoin Mining Facility at the Center of a Political Battle

CoinDesk’s report on the fight over a bitcoin mining facility in Upstate New York reveals the politicization of cryptocurrency issues and the class conflict that arises from it.

CoinDesk’s story this coming week about a fight over a Bitcoin (BTC) mining facility in Upstate New York outlines how digital currency issues are quickly becoming politicized in familiar ways.

This coming week CoinDesk published one of the most thought-provoking and balanced articles on Bitcoin (BTC) mining I’ve ever read. The report is focused around the Greenidge Bitcoin (BTC) mining company in upstate New York, which was at the center of a protracted media cycle a year ago after environmental activists claimed the facility was boiling the waterways and poisoning delicate ecosystems. Those states went on to influence an actual policy decision by Governor Kathy Hochul restricting Bitcoin (BTC) mining in the state.

The thing is, most of the worst states about Greenidge were straight up wrong. CoinDesk’s Nik De, Doreen Wang and Cheyenne Ligon took a trip to Dresden, in Upstate New York, to take the temperature of the lake and speak to locals, finding that not a single lawmaker visited the rust-belt town or spoke to its mayor before drafting what is essentially a freeze on new Bitcoin (BTC) miners.

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Most of the Bitcoin (BTC) mining debate today has centered around the Bitcoin (BTC) network’s environmental impact. Greenidge became a lightning rod because before the company moved equipment into a deactivated coal-burning plant, meaning the miners weren’t just drawing on the state’s electricity that would have been produced anyway, but actively releasing “fresh” carbon into the atmosphere.

The Bitcoin (BTC) network uses as much energy as a country like Norway, and attempting to wrap your head around whether that is or isn’t “worth it” often comes down to your point of view on how you value permissionless money. Individuals can certainly make up their minds on the matter, but how a state should treat Bitcoin (BTC) – for example, whether mining should be encouraged or banned – is a societal-level conversation involving politicians, stakeholders and those affected.

In a behind the scenes account of how the story came to be, De wrote that he expected locals to hate the plant. They’d been informed that Greenidge was pumping pollution into Seneca Lake and creating incessant noise at the plant reportedly created (a assert that was likewise debunked). Instead, De’s team found that numerous in the town and surrounding area supported the upstart business. Despite the fact that Greenidge created a relatively small number, every job counts in a town like Dresden (population: 296).

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In reality, the few complaints about Greenidge lodged by locals came from so- was known “cottage people” – the wealthy out-of-towners with vacation homes on the lakeshore. Sure, as taxpayers these people have a right to be concerned about their property value, but should their opinion matter more? Because it seemed to.

And here layeth the nut: Beyond all the other intractable discussions about Bitcoin (BTC) mining potentially kicks up lies a class conflict. You all know the story: Bitcoin (BTC) was born during the Great Financial Crisis, a tool that allowed anyone to access a semi-private electronic cash system where the money supply would always be verifiable – a total rebuke of banking and the Federal Reserve.

Over time, that narrative has gotten a little more complicated, especially as some of BTC’s largest supporters have become entrenched elites themselves essentially for making several  good trades a decade ago. There are now many of white-collar jobs based around analyzing bitcoin’s price performance and lobbying for new-fangled financing vehicles derived from bitcoin.

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Bitcoin (BTC) mining as well has gone from something you could do on your home computer to becoming a highly- financial resources intensive industry, requiring the buy of hundreds or thousands of specialized computers that draw electricity 24/7, if you want to compete on any meaningful scale. On the other hand, the proof-of-work algorithm that makes Bitcoin (BTC) likewise tethers it to the ground: these assets are being made in real communities.

Greenidge, for example, has hired real, unionized electricians and created dozens of short-term construction jobs. The company has made a number of improvements into Dresden, including fixing up a children’s playground and other beautification efforts. Not all facilities operate their own coal-plant like Greenidge requiring as much labor, but numerous do create opportunities for people where opportunity doesn’t always come a-knocking.

If Greenidge is any indication, the real conversations we may be having around Bitcoin (BTC) mining and class will be increasingly consumed by another conflict: the Culture War. I’ve stated for a time, perhaps being as well reductionist, that Bitcoin (BTC) is going to become a red-blue issue in the United States, with Republicans increasingly endorsing it and Democrats disavowing. Despite the fact that the network itself will likely always remain “credibly neutral,” the way we think about it, and politicize it, will fall along predictable lines. Numerous topics have traveled thus. Before climate change became a wedge issue in American politics, for instance, it was a relatively non-partisan issue that numerous politicians agreed on the must do something about.

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Just yesterday, Florida Governor Ron DeSantis (R.) spoke about BTC’s “threat to the present regime,” in an notice event for his 2024 presidential campaign. Despite the fact that modeling himself as a populist, DeSantis has the early support of monied technologists like Elon Musk (Tesla & SpaceX CEO) and fellow PayPal Mafia member David Sachs. DeSantis is probably most trending nationally for what’s been termed the “ Do not Say Gay” bill and a fight with Disney.

Something tells me DeSantis’ pledge to “protect” Bitcoin (BTC) is as performative as his “ban” on monetary authority digital currency (CBDC) in Florida (before the Fed has even decided whether it’s worth fully studying a digital dollar). On the other hand, it’ll still be enough to color some people’s impressions of cryptocurrency, furthering the type of political feedback loop that enabled environmentalists to lie about Greenidge’s ecological footprint and the Democratic Government in New York to buy it whole cloth.

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As my colleague Nik De stated, “a conversation that doesn’t include the people most directly impacted can lead to wonky outcomes.” And once the only two political parties of consequence are shadow boxing about fake internet money, the only people who can get a word in edgewise probably own a vacation home.


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