After China began attacking crypto and crypto miners in late 2021, many bitcoin miners started moving into the United States. At the time, the U.S. seemed like the best option out there. However, with time, the migrating miners began facing challenges in the new territory.
This guide explores the two main challenges as well as major opportunities for miners in the U.S.
Challenges Crypto Miners Face
One of the biggest issues connected to crypto mining in the U.S. is associated with regulations. Over recent years, the united states have proven to be a regulatory threat against crypto networks. U.S. regulatory bodies like SEC and CFTC have set their sight fully against cryptocurrency networks.
The regulatory turmoil within the United States has caused some major crypto companies to exit the country. This is a challenge for crypto mining companies. Reports indicate that New York, a U.S. state some time back, recently banned crypto mining.
Another major challenge impacting the is connected to green energy costs and availability. Crypto mining has for years been proven to be a high-energy consumer, taking large quantities of power for every bitcoin mined. The machinery used in mining, especially the special hardware like ASICs, are massive power consumers.
Using high-carbon energy solutions means that crypto mining contributes largely to environmental degradation despite consuming high energy. The Carbon footprint associated with those mining companies is so high that environmentalists have called for stricter policies.
There are solutions to the energy crisis, including using Carbon neutral forms of energy in mining. Some major crypto companies in the U.S. have gone for clean energy, but a majority remain reliant on the old forms of energy, which emit high amounts of Carbon. Most mining companies have yet to switch because of the unavailability of such clean power plans in their regions.
Earlier this year, a probe from the Senate looked into the power consumption of crypto mining. Among the issues mentioned include clean energy and high power usage.
Opportunities for Crypto Mining in the US
Florida’s Friendly Laws
Florida has recently been shaping up as a great hub for the crypto ecosystem. The governor himself, Ron Desantis, is a pro-crypto leader.
Last year in March, Governor Desantis expressed support for the crypto ecosystem, especially when settling tax bills. This is not the only pro-crypto move the governor has already made.
Just recently, DeSantis signed a bill that forbids the use of CBDC within Florida. Like many in the crypto community, the governor believes that the CBDCs are control tools for the government. The governor believes the current administration is focused on launching CBDCs to control and track people. The crypto community shares the governor’s sentiments.
In 2021, the governor signed legislation designed to define crypto assets based on Florida’s state statutes. DeSantis claimed that Floridians could trade virtual currencies without licensing in the same period.
While announcing his bid for the 2024 U.S. presidential elections, DeSantis announced the protection of bitcoin as one of his priorities. DeSantis also mentioned that ‘if’ he becomes the U.S. president, CBDC will be utterly abolished.
Most of Governor DeSantis’s moves on crypto have been seen as highly beneficial for the community. Crypto miners in the United States should take advantage of the favorable season in Florida. But how?
People in different states can move their crypto mining activities to Florida to continue benefitting the region and enjoy favorable laws. Remember, as in the case of Nebraska, crypto can be very beneficial. Since Florida already provides a state for crypto, miners hosting their services will benefit all parties.
Fair Priced Energy
The favorable energy prices were a significant reason mentioned when crypto mining companies were relocating from China to the U.S. Unlike many other countries globally, the average price of electricity in the U.S. is relatively low. As mentioned already, electricity consumption is very high in mining. Therefore, access to cheap energy in the U.S. is an excellent opportunity for miners.
In the past, many have praised Texas as a great region for crypto mining owing to the fair energy prices. Crypto miners should think of taking advantage of such an opportunity.
The Nebraska Case
One of the opportunities that the cryptocurrency mining market should take advantage of was recently lightly highlighted in a senate hearing on energy. In the hearing, Courtney Dentlinger, a former head of economic development in Nebraska, talked about the impact of Bitcoin mining in the region.
According to Courtney, bitcoin mining can help lower taxes associated with crypto mining.
Courtney highlighted some major benefits crypto mining companies have brought to Nebraska, including creating jobs and helping lower taxes. Based on Courtney, crypto businesses have thrived in Nebraska as they offer high-paying job opportunities.
The expert highlighted a mining facility in Nebraska that costs about $3.8 million for local tax and $1.6 million for sales tax in 12 months.
This guide has clearly explained how changing and inconsistent regulations in the U.S. have been a significant challenge for crypto mining companies. Furthermore, the calls for carbon neutrality have also affected crypto mining, an extremely energy-consuming activity.
However, despite the challenges, more opportunities are afforded to crypto miners in the U.S. The fair energy prices and Florida’s love for crypto are two key opportunities that crypto miners should choose to explore.