Beijing’s harsh crackdown on the Bitcoin industry has triggered what’s being dubbed “the great mining migration.”
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China has been home to 60% to 75% of the world’s Bitcoin mining in recent years, the energy-intensive process that makes new coins and keeps a running tally of all transactions on existing cryptocurrencies.
But in May, the government restricted mining and trading, prompting an exodus of miners to states like Texas and Florida, according to CNBC. The Lone Star State’s abundance of solar and wind power, deregulated power market and pro-crypto political stance make it a perfect destination, says Brandon Arvanaghi, a former security engineer at crypto exchange Gemini.
“Texas not only has the cheapest electricity in the U.S. but some of the cheapest in the globe…[and] governors like Greg Abbott in Texas … are promoting mining.”
Miami Mayor Francis Suarez says he’s also looking to lower energy costs with the hopes of attracting bitcoin miners.
Because the industry requires very little beyond an internet connection, the business is incredibly flexible, says Steve Barbour, founder of Upstream Data, a manufacturer and supplier of portable mining solutions for oil and gas facilities.
“[It’s] a portable market; you can bring it right to the source of energy,” he says.
Other possible global destinations include countries like Kazakhstan which is next door to China. The nation’s coal mines offer a low-cost, abundant energy supply and the government has building-friendly policies which make it easy to construct offices quickly.
But what’s still not clear is how fast or far “the migration,” as it’s known in crypto circles, will unfold. Arvanaghi says movement has already begun and “a dramatic shift” should follow in the next few months. His optimism is long-term with the eventual development into a viable business, “It is going to become a real industry in the United States, which is going to be incredible.”