Move over Wyoming… There's a new challenger in town. Texas is now a serious contender in the race to become the crypto center of the U.S. following a wave of investment, pro-blockchain lawmaking, and Bitcoin-boosting political campaigning.
The Lone Star State is famous for its oil industry, which is worth well over $100 billion. One day, though, the fossil fuel industry will become a literal fossil. So will the crypto sector rise to take its place?
Lee Bratcher, a political science lecturer and director of the master’s program in international studies at Dallas Baptist University, founded the Texas Blockchain Council last year to help nurture a world-leading crypto sector.
He hopes to make Texas “the jurisdiction of choice for blockchain innovation” - an ambition backed by prominent politicians in the State.
A bill called HB 1576 recently established a working group that will “develop a master plan for the expansion of the blockchain industry in Texas and recommend policies and state investments in connection with blockchain technology”.
This group will now identify “economic growth and development opportunities presented by blockchain technology”, assess the current state of the sector, develop academic programs to build blockchain expertise, and make legislative proposals to promote “innovation and economic growth by reducing barriers to and expediting the expansion of the state's blockchain industry based on its findings in developing the master plan”.
Earlier this year, Texas Governor Greg Abbott signed the "Virtual Currency Bill”, which gives legal clarity to crypto and will help to provide a legislative foundation for the sector’s expansion.
"Blockchain is a booming industry that Texas needs to be involved in. I just signed a law for Texas to create a master plan for expanding the blockchain industry in Texas," he tweeted after the bill was passed.
Aside from the political backing, Texas also has key infrastructural advantages for the crypto industry.
One of the reasons why Texas is a prime spot for a crypto boom is its deregulated electricity grid, which allows customers to choose providers, making energy prices in the state among the lowest in the country.
When miners power down their facilities during peak times or periods of energy shortages, electricity providers even pay out to compensate for the downtime.
Rockdale, Texas, is home to North America’s largest Bitcoin mining and hosting facility, which was built by a company called Whinstone that was bought by Riot Blockchain in May 2021. This huge facility stretches across a 100-acre site and hosts several miners in three buildings.
“Since early 2020, the Whinstone team has worked on creating the largest hosting company in North America,” Riot wrote.
“Pairing low cost of energy and a market-leading development and operations team, Whinstone has been able to build the largest Bitcoin mining hosting campus as measured by machines operational and megawatts developed at a single site.”
Texas has benefited from the crypto crackdown in China, where authorities have ordered miners to cease operations.
In May 2021, a Chinese company called BIT Mining signed a $26 million deal to build a crypto mining facility in Texas - and it might not be the last.
So if you’re looking to saddle up and join the crypto revolution, you might want to think about heading down to Texas.
If you’ve got a crypto story, contact jasper@gokhshtein.com
