Welcome to Texas, The New Crypto Mining Utopiabitcoin depot
Texas is seeing a boom in cryptocurrency mining operations heading to the state thanks to low energy rates and relaxed regulations, along with an abundance of renewable resources like wind and solar energy. A lot of people see Texas as an oil state; however, it is also becoming a major producer of the computing power needed to mine crypto. This is why many key players of crypto have been eyeing the Lone Star state as the next location for their operations.
In fact, Dallas and Fort Worth are already home to hundreds of bitcoin miners who take advantage of cheap electricity due to the available spare computing power and cool winter temperatures.
Why Crypto Miners Are Moving to Texas
A number of factors are coming together to make Texas an ideal place to establish a crypto mining operation. One factor is the price of land in Texas, which is relatively inexpensive since the state is large in size. This gives operators ample space to build large solar or wind-powered facilities with plenty of acreage for parking lots full of mining rigs. Anecdotally, commercial real estate agents are seeing more inquiries from bitcoin miners these days.
Many digital currency companies are relocating to or expanding throughout Texas not only because it's one of the top states for oil and gas extraction, but also because its deregulated market allows energy suppliers to offer cheap rates for firms who are sizing up crypto operations. Many experts are confident that this trend will also bring many six-figure jobs to the state.
Texas is a great place to mine crypto because energy companies are willing to lock in long-term, fixed-price contracts with miners. Many electricity providers will sign on for the guaranteed volume of energy that these mining operations need and they do this by signing onto 20-year agreements, often at extremely low rates. This means that Texas has become an attractive site for crypto mining businesses due to its abundant resources and stable economy.
In the summer months, power plants may even have to pay a mining facility to reduce energy use. However, more often than not in these cases, it's actually consumers that hold onto their own power purchase agreements (PPAs), who are selling back excess electricity from renewable sources like wind and solar because demand for traditional forms of energy is at its highest during this time period.
Power purchase agreements allow businesses or individuals who produce environmentally-friendly electric power through alternative means—such as those using solar panels on rooftops or geothermal heating systems—to sell any unused allocated amount directly back into the grid.
More Environmentally-Friendly Options
Crypto miners who seek greener solutions are pushing North American energy sources down a more environmentally-friendly path. They're moving into Canada and the United States on top of preparing for an uncertain future where their usage could potentially be subject to stricter regulations in the future.
Texas is particularly appealing to crypto miners because of the wide array of available renewable energy sources such as wind power, which comprises almost a fifth of the energy produced in the state. In addition to this, Texas is gaining ground in solar power and now ranks fourth for total US solar energy production.
The advent of cryptocurrency mining is also pushing Texas to embrace other energy technologies including batteries and ultracapacitors for storing electricity and making it available on-demand.
Texas is relatively friendlier to mining operations than other states. For example, Wyoming imposes a tax on all electricity generation from renewable sources and bills it as "renewable energy credits."
However, the state of Texas does not have a comparable law—or any law taxing or regulating crypto. The Texas Coinitiative website states that "Texas has no regulation on the books regarding Bitcoin transactions."
In a growing trend, Texas has become the second state to allow employers to pay wages in bitcoin. As of August 2021, there are over 2,500 crypto ATMs in Texas alone—a testament to their cryptocurrency-friendly policies!
Texas has another advantage: it has no state income tax, which makes it an attractive location for crypto miners. In addition, the state is also a right-to-work state and ranks among the top states for business in terms of taxation and regulation. This is why many crypto companies are moving to or opening mining facilities in Texas.
The Positive Impact of Crypto Mining on Texas
Texas is rapidly becoming a cryptocurrency hub. Politicians have proposed tax incentives to attract mining businesses, and it has already passed legislation that makes it easier for crypto companies to operate in the state.
The Lone Star state is practically built for crypto mining operations, and only time will tell what the future of the crypto industry in Texas holds.
Sept. 3, 2021