MIT Technology Review

Chain Letter

Blockchains, cryptocurrencies,

and why they matter

Boom and bust

02.27.20

Welcome to Chain Letter! Great to have you. Here’s what’s new in the world of blockchains and cryptocurrencies.

Texas’s wind boom is what set the stage for its digital gold rush. Last week we had a blurb about how Peter Thiel and others were betting big money on Bitcoin mining in Texas, looking to take advantage of its cheap electricity. Intrigued, I decided to look further into what is going on in the Lone Star State. What I found is that it’s just as much an energy story as it is a Bitcoin story. A number of factors, including federal and state pro-renewables policies, deregulated electricity market, and, of course, high winds have led to a wind power boom in west Texas. 

But sometimes the wind power is so plentiful there is too much of it to carry across the state to its big population centers to the east. So wind producers in west Texas are eager to find customers closer to them to buy that extra wind. In theory, that gives mining firms leverage to reach agreements that give them access to very cheap wind power. The bottom line is that miners are realizing there is digital money to be made in Texas, as long as they can cheaply protect their mining hardware from its sweltering heat.

- MIT's Chain Letter this morning