Two bitcoin mining giants are vying for cheap electricity in a small Texas town.
Bitdeer, a mining company spun off from Bitmain, and Riot Blockchain, one of the leading publicly traded bitcoin mining companies in the United States, are both based in the town of Rockdale, Texas (Rockdale) A former aluminum smelter operates a data center.
The town's aluminum smelter was once the largest in the world until Alcoa, which operated it, began winding down operations in 2008. From the time Alcoa left to the time the miner set up the mine, the smelter’s energy reserves have been wasted, according to Lee Bratcher, chairman of the Texas Blockchain Council.
Even though Rockdale is a rural town of just 5,600 people, it showcases all the good things industrial-scale miners are after — crypto-friendly politicians, huge tracts of land with abandoned industrial infrastructure to repurpose , and cheap electricity thanks to a deregulated market in Texas.
Rockdale Mayor John King described the relationship between the local grid operator, the Electric Reliability Council of Texas (ERCOT) and miners as mutually beneficial. He emphasized that miners often consume electricity that would otherwise be wasted, and they can also shut down operations immediately if power is needed elsewhere. He added:
“The miners commit to buying a certain amount of electricity, what they do is sell it at the market price and then make a profit. They have a contract for 2 cents or 3 cents … and they can sell it for $9 a kilowatt-hour. "
Riot has more than tripled its bitcoin production this year, Cointelegraph reported Oct. 7.
The company now estimates that the Rockdale facility produces more than 500 bitcoins per month. At current prices, the mined bitcoins equate to $30 million per month. Riot said the mine has 100,000 mining machines.
Texas lawmakers are pushing to further expand bitcoin mining in the state, with Senator Ted Cruz saying mining is a means of accessing the natural gas that the state currently burns.
Speaking at the Texas Blockchain Summit on Oct. 10, Cruz said that gas is currently being flared in West Texas because “there is no transmission facility to get the gas to where it is normally used.”
He added: "Using this energy to mine bitcoins. One of the benefits of doing that is that when you do it, you're doing a lot of good for the environment because you're not burning the gas, you're using it for production. .”
Cointelegraph Chinese is a blockchain news information platform, and the information provided only represents the author's personal opinion, has nothing to do with the position of the Cointelegraph Chinese platform, and does not constitute any investment and financial advice. Readers are requested to establish correct currency concepts and investment concepts, and earnestly raise risk awareness.
Sanya