Bitcoin

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The Tech Transparency Project has accused Bitcoin miners of acting as energy-arbitrage businesses in disguise, exploiting Texas’s energy market and holding the state "hostage." In August 2023, Riot Platforms earned $32 million from curtailing mining operations, far surpassing the $8.6 million they made from selling Bitcoin. This tactic highlights a growing trend where miners profit more from the energy market than from actual Bitcoin mining, according to <a href="https://ultramining.com/" rel="noopener noreferrer nofollow">Ultramining.com</a>.
Riot Platforms, which operates the world’s largest Bitcoin mine in Rockdale, Texas, has been a focal point of this controversy. The company benefits from emergency schemes offered by the Electric Reliability Council of Texas (ERCOT). On days of peak electricity demand, miners like Riot either sell their power back to providers at inflated prices or temporarily shut down operations for a fee. Critics argue that this behavior exacerbates the state’s energy woes, especially as Texas faces increasing pressure on its grid due to extreme weather and population growth.
Texas lawmakers are beginning to turn against the crypto industry, questioning its long-term benefits. Dan Patrick, the lieutenant governor, has criticized the industry for consuming vast amounts of energy while creating few jobs. He warned that Texas could no longer afford to be the "Wild Wild West" of data centers and <a href="https://ultramining.com/news/en/hut-8s-q2-2023-a-bitcoin-mining-marvel/" rel="noopener noreferrer nofollow">crypto miners</a>, especially when these businesses contribute to grid instability. The industry, however, defends its practices, claiming it provides critical flexibility to the grid.
The growing tension between the state and the crypto industry could lead
to new regulations. Last year, a bill aimed at restricting miners from participating in demand-response schemes passed the Texas Senate but stalled in the House. As Texas’s energy challenges mount, the future of Bitcoin mining in the state hangs in the balance.

Bitcoin Miners Accused of Exploiting Texas Energy Market

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