Bitcoin Mining In Texas Faces Uncertain Future With New Regulations – 248

That's a lot boys Things are happening extremely quickly Right now this is the fastest shift in I think In any industry this is the fastest Shifting industry I've ever seen In my lifetime it's pretty crazy Texas has taken a decisive step toward Imposing much stricter regulations on Bitcoin miners will other states follow No but we'll talk about that in a second Because we have a follow-up to this Article Bitcoin requires a ton of energy To maintain its Network and Texas Lawmakers have taken notice today the Texas state senate came one step closer To reaching an agreement about Senate Bill 1751 which we talked about on this Channel last week or the week before I Can't remember which will regulate how Bitcoin miners can interact with the Power grid and how their earnings will Be taxed introduced in the Texas state On March 7th the bill sponsors are a Trio of GOP state senators Louise Cole Cursed Donna Camp Campbell and rich Robert Nichols while New York and other States have recently emerged as some of The fiercest anti-crypto jurisdictions In the country the implications of Texas Legislation go far indeed it may Fundamentally undermine how Bitcoin Miners in the state operate the state Has a power grid that is wholly separate

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From the rest of the country in the last Few years it has made headlines for Surge pricing and outdated or Underprepared Hardware I've actually been learning a lot about This I want to share it but I'm not sure Exactly what I'm allowed to share Because I do work in the industry now And uh it's been extremely eye-opening And there's a lot going on it is really Interesting that surrounds this Um this isn't quite Fair And I can tell you why Um But there was a reason for the surge Outside of that it's actually quite Interesting but let's move on now add Energy intensive mining practices and The problem gains the potential to Become more and more accurate At present companies like Riot platforms A 100 Acre facility based in Rockdale Use so much energy that when electricity Is in short supply the electricity Electric reliability Council of Texas Pays them to limit their energy use This has been a partnership in Texas That's actually been going on since Before The great storm They shut down Texas for about a week And it has also been one of the number One reasons Texas has been able to

Effectively improve the power grid Because what happens here is that the Bitcoin miners are utilizing unused Power and when it needs to be supplied Back to the grid they can turn off and Provide it back to the grid which is why They get paid in turn now In my humble opinion this is actually Good for the grid and so when you see This being restricted by a bill it Brings up quite a few questions now I Think this should be applied to any Minor home miners Etc it should go the Opposite direction of what is going in Now SB 1751 will ban this kind of Relationship As well as require these companies to Coordinate directly with ercot in a Power emergency so what they're trying To do now is instead of incentivize the Mining company and the miners to shut Down what we're going to do is just ride It into law that we force them to shut Down and then we don't have to pay them Anymore The thing is is if you were purchasing Off of the spot Market to make up that Power that you lose you're going to Spend a lot more on the spot market so To give you an idea power is a market Right so a lot of the power companies Around you have the power generators and Then you have like the the delivery Right and what happens is or the

Transmission so then you have power Companies that are your transmission Typically you're dealing with like a Power company that is transmitting the Power okay and what they do is they go On to the market and they purchase for The next day or for so far out what this Allows you to do is you you'll have Basically like a group of people that Will go in at a power company they'll Look at the weather they'll determine Like well uh on this date last year the Weather was this it looks like it's Going to be similar and therefore we're Going to need this amount of power okay Well what happened in the winter storm Is when everything shut down because There was obviously everything was Freezing up and the power generation Wasn't keeping up with the power needs The cost of the power shot through the Roof and this is on the spot market and Really What happens though is like let's say You're a okay so let's say you you're a Power transmitter or whatever and Riot Is like your supplying power to Riot now I Riot might be working with power Generators well as well there's a lot of Different ways this could play out right But let's say that they're going through Like a power company that's only Transmitting the power and that power Company has to purchase Mark a purchase

Power uh from a generator right on the Market right Well let's say you go into a huge demand Right and they basically the demand Exceeds what they currently have and for That day they have to go on to the spot Market what that means is that they're Going to way over pay for power right Because they don't have enough power so They have to go in instead of that what They can do is they can have the miners Shut off and pay them a fee which would Actually be cheaper than going on to the Spot market and purchasing on the day of The crisis taking place this is why it's Fundamentally important and it balances Out the actual cost for of the power for The residents in that area too because What they're trying to frame this as as It being is as it being negative for the Residents when in fact what it does is It keeps the power cost more stable for The residents because they have this Access and they don't have to go on to The spot Market in the case of over of Under generation and purchase right and The best part is is when they shut them Down they can then if it's a power Co-op Or whatever it may be they can take the Power the extra power the over Generation from the Bitcoin mining Farm Shutting down and sell that onto the Spot market for a premium meaning that The power companies probably every time

Riot comes down the power company is Making a significant amount more money Selling that extra power back to the Market giving a piece of it to them and Then in the case of a co-op giving a Piece of it back to the members or Whatever this is the way that it all Functions this is all the stuff that I've been learning about and it's in it It means that like your perception of Like what actually is going on here and What the committee is trying to tell you Is happening is not actually how it Functions in reality I hope that made Enough sense and at some point maybe I'll do a whole video on it if you guys Want me to let me know in the comment Section below but this is how it's Functioning to balance out the price for The residents okay Um March 28th this Texas State committee on Business and commerce heard testimony on The bill it's statutes currently pending The Texas Bitcoin Foundation did not Respond by press time to request for Comment So there you go

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