Texas Takes the Lead in Bitcoin Mining Sector
Texas has emerged as the top player in the U.S. Bitcoin mining sector, accounting for 28.5% of the country’s hash rate, according to data from Foundry, a leading global Bitcoin mining pool. This is a significant increase from Texas’s 8.4% share a year ago. Meanwhile, other states like New York and Georgia have seen their shares decrease to 8.8% and 9.6%, respectively.
Reasons for Texas’s Ascendancy
The rise of Texas in the cryptocurrency mining domain can be attributed to governmental initiatives that incentivize miners to help maintain the electricity grid’s equilibrium. Miners are requested to halt operations during times of grid stress, and those who comply are later compensated by the state. Senator Ted Cruz has also expressed his belief that Bitcoin mining can improve the energy grid’s resilience by serving as emergency power reserves.
State Incentives Driving Mining Growth
In June, Texas legislators passed two bills that support the mining industry. SB 1929 requires miners with energy capacity exceeding 75 megawatts (MW) to register as large load operators with the Public Utilities Commission (PUC) of Texas. HB 591 provides tax exemptions for companies that make efficient use of previously wasted gas resources. These initiatives have attracted mining companies like Riot and Cipher Mining to expand their operations in Texas.
Data Underestimates Texas’s Stake
Foundry acknowledges that their data, recorded during a slowdown phase for local miners, may underestimate Texas’s actual share of the hash rate. The University of Cambridge, which regularly releases data on Bitcoin mining, plans to update its mining map in the upcoming year to provide a more comprehensive sample size and avoid dominance by a single pool.
Hot Take: Texas’s Expected Rise in Prominence
According to Alexander Neumueller, the head of Digital Assets Climate Impact Research at the University of Cambridge, Texas’s growing prominence in mining isn’t unexpected. He believes that the current mining scenario is likely different from the data recorded in January 2022, considering the shifts in mining regions such as China and Kazakhstan.
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