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Texas lawmaker introduces resolution to protect Bitcoin miners and HODLers

The Lone Star State is already home to many crypto and blockchain firms as well as miners taking advantage of the regulatory-friendly environment.

Cody Harris, member of the Texas House of Representatives, has introduced a resolution aiming to have the legislature say the “Bitcoin economy is welcome” in the state.

In a resolution released on March 21, Harris encouraged Texas lawmakers to “express support for protecting individuals who code or develop on the Bitcoin network” as well as miners and Bitcoiners operating in the Lone Star State. The state representative added that Texas’ constitutional rights concerning “all unreasonable seizures or searches” should extend to attempts to go over residents’ digital asset holdings.

“Individuals who mine Bitcoin in Texas will never be inhibited by any law or resolution that restricts the practice of securing the Bitcoin network for the safety of the virtual currency,” said the resolution. “All those in the broader community who choose to own Bitcoin as a manner of storing their wealth and transacting peer-to-peer with other law-abiding Texas citizens shall always feel free and safe in their ownership and use of Bitcoin.”

House Concurrent Resolution 89, if adopted, would largely not apply to Texas’ laws and regulations, but rather express a certain sentiment among lawmakers. The resolution cited the Chinese government’s crackdown on crypto miners, a move which drove many firms to Texas. Riot Platforms, Core Scientific, and White Rock Management are among some of the firms to set up operations in the Lone Star State.

Under the state’s commercial laws, cryptocurrencies are recognized as part of an amendment to Texas’ Uniform Commercial Code. However, some lawmakers at the federal level have criticized Texas’ seemingly loose regulatory regime for the potential environmental impact caused by the energy consumption of mining firms.

Related: Bitcoin mining advocate is going state-to-state to educate US lawmakers

Texas Governor Greg Abbott, reelected to another four-year term in November 2022, has previously referred to himself as “crypto law proposal supporter” in the state. According to Florida Governor Ron DeSantis, Texas was considering a ban on central bank digital currencies both foreign and domestic following a similar initiative announced by his office on March 20.

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Compass Mining Alerts Bitcoin Miners of Changes in Bitmain’s ASIC Design

Compass Mining Alerts Bitcoin Miners of Changes in Bitmain’s ASIC DesignCompass Mining, a bitcoin mining firm, published a blog post stating that Bitmain, the company behind the application-specific integrated circuit (ASIC) mining rig, has made changes to its design. The post advised miners to be aware of the changes as Compass Mining identified “three issues” with two different Antminer S19 series mining devices. Bitcoin Miner […]

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Texas objects to Voyager-Binance.US deal, court filing shows

Texas claims that Binance.US's terms of service and restructuring plan contain inadequate disclosures, and discriminate against Texas creditors.

Texas' State Securities Board and the Department of Banking are objecting to a proposed deal between Binance.US and bankrupted crypto lender Voyager Digital, shows a court filing from Feb. 24. 

According to the document, Binance.US's terms of service and restructuring plan contain a number of "inadequate" disclosures, including not informing unsecured creditors adequately that under the plan they may only get 24%-26% recovery, rather than the 51% they would receive under Chapter 7. Binance.US disclosed in December an agreement to buy Voyage's assets for $1.022 billion.

The filing also notes the company's disclosure statement fails to inform that account holders are required to allow the transfer of "personally sensitive information to any party in any part of the world as required by Binance.US, and then strips the account holders of any legal recourse for any issues that may arise." As explained in the objection:

"So, under these ToUs, customers’ information can be transferred to almost any company or person that Binance.us desires, and, if any issues arise in the customers’ access to or use of Binance.us’s Services, the customers have absolutely no right to challenge the issue."

Further, the document claims that the plan "unfairly discriminates against Texas consumers." Since Texas is not a supported jurisdiction by Binance.US, customers in the state would have their digital assets held by Voyager for six months after the agreement, during which time Binance.US would seek licensing in the state.

According to the objection, however:

 "It will be almost impossible for Binance.us to be licensed by the Texas SSB and the DOB within six months and, as such, holding the Texas consumers’ coin for six months accomplishes nothing." 

The filing comes just a few days after the Securities and Exchange Commission (SEC) submitted a filing to a bankruptcy court in New York alleging securities law violations in some aspects of the restructuring plan. Binance.US and related debtors are being investigated by the SEC for possible anti-fraud, registration, and other violations of federal securities laws. 

In the document, the SEC expressed concerns about the security of assets acquired through the proposed acquisition, among other issues.

Binance.US did not immediately respond to Cointelegraph's request for comments.

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El Salvador Considers Opening Second Bitcoin Embassy in Texas to Boost Economic Exchange

El Salvador Considers Opening Second Bitcoin Embassy in Texas to Boost Economic ExchangeOn Feb. 14, 2023, Milena Mayorga, the Salvadoran ambassador to the United States, announced that her country is considering opening a second bitcoin embassy in the Lone Star State. Mayorga said that Texas is “our new ally” and the goal is to expand “commercial and economic exchange projects.” Ambassador Milena Mayorga Fosters Growing Relationship Between […]

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El Salvador to open a ‘Bitcoin Embassy’ in the United States

After debuting a Bitcoin Embassy in Switzerland’s city of Lugano, El Salvador continues expanding its BTC strategy with a new partnership with Texas.

The world’s biggest cryptocurrency, Bitcoin (BTC), is connecting more countries as the government of El Salvador is opening a “Bitcoin Embassy” in the United States.

El Salvador, a country that adopted Bitcoin as legal tender in 2021, is expanding its Bitcoin strategy in a new partnership with the government of Texas. The intergovernmental collaboration aims to set up a Bitcoin Embassy, or El Salvador’s representative office, in Texas to work on new joint projects to promote Bitcoin adoption.

Milena Mayorga, the Salvadoran Ambassador to the United States, announced the news in a statement on Twitter on Feb. 14.

Texas Deputy Secretary of State Joe Esparza and El Salvador’s U.S. ambassador Milena Mayorga. Source: Twitter

“In my meeting with the assistant secretary of the government of Texas, Joe Esparza, we discussed the opening of the second Bitcoin Embassy and the expansion of commercial and economic exchange projects,” Mayorga said.

The latest Bitcoin initiative comes a few months after El Salvador opened the first Bitcoin Embassy in Switzerland’s southern city of Lugano in October 2022. As part of the efforts, the two pro-crypto jurisdictions started working to establish a physical governmental presence to promote cooperation in education and research institutions related to Bitcoin.

According to former Blockstream chief strategy officer Samson Mow, the phenomenon of the Bitcoin embassy is the next step in nation-states and cities adopting Bitcoin. He said that such initiatives imply cooperation between countries to develop new initiatives like establishing alliances between places that have adopted Bitcoin.

Related: El Salvador’s ‘limited’ use of Bitcoin prevents forecasted risks, says IMF

The news comes amid Texas lawmakers reportedly considering a new bill calling for a “a master plan for the expansion of the blockchain industry.” The legal initiative aims to turn Texas into the crypto capital of the country by introducing tax-free shopping with Bitcoin, among other proposals.

As previously reported, Texas has emerged as one of the crypto-friendly U.S. states, passing crypto-friendly laws aiming to better adapt commercial laws to blockchain innovation and digital asset regulations. Texas is also home to some of the largest Bitcoin miners in North America, with major mining companies like Riot Blockchain, Core Scientific and Genesis Digital Assets operating in the state.

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Iris Energy Boosts Self-Mining Capacity With 4.4 EH/s of New Bitmain Bitcoin Mining Rigs

Iris Energy Boosts Self-Mining Capacity With 4.4 EH/s of New Bitmain Bitcoin Mining RigsBitcoin miner, Iris Energy, announced plans to increase the company’s self-mining capacity, from 2 exahash per second (EH/s) to approximately 5.5 EH/s, after it receives 4.4 EH/s of new Antminer S19j Pro miners from Bitmain. Iris Energy Leverages $67 Million in Bitmain Prepayments for Latest Mining Expansion Bitcoin mining company, Iris Energy, announced plans to […]

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Riot reports 17K miners offline due to Texas weather

The mining firm reported two of the buildings at its Whinstone facility in Rockdale were damaged in December as Texas experienced days of sub-zero temperatures.

Crypto mining firm Riot Platforms — formerly Riot Blockchain — reported that 17,040 rigs deployed at its operations in Texas were offline due to “severe winter weather” in the state.

According to a Feb. 6 announcement, Riot reported two of the buildings at its Whinstone facility in Rockdale, Texas were damaged in December 2022 as the state experienced days of sub-zero temperatures. From Dec. 22 to Dec. 25, temperatures across many parts of Texas — and the United States — dropped to below freezing.

“Some sections of piping in Buildings F and G were damaged during the severe winter storms in Texas in late December,” said Riot CEO Jason Les. “As a result of this damage, our previously announced target of reaching 12.5 [exahashes per second] in total hash rate capacity in Q1 2023 is expected to be delayed.”

Les said that the damages initially lowered the facility’s hash rate capacity by 2.5 EH/s, with the company later able to restore 0.6 EH/s following repairs. According to Riot, there were 82,656 rigs running with a hash rate capacity of 9.3 EH/s as of Jan. 31, when the company reported producing 740 Bitcoin (BTC) — worth roughly $17 million at the time of publication.

Though many parts of the United States experienced severe temperature drops in December amid holiday travel, major cities in Texas including Dallas and Austin also went through a major ice storm in early February. Thousands of residents were without power and many tree branches and limbs broke from the weight of accumulated ice, damaging power lines and cars, and blocking roads.

It’s unclear whether Riot miners were similarly affected by the storm. However, the company did not report curtailing operations due to demand on Texas’ energy grid during the recent freeze.

Riot also reported selling 700 BTC for roughly $13.7 million in January, with the company holding 6,978 BTC as of Jan. 31. The mining firm reported selling coins following extreme heat in the Lone Star State in July 2022.

Related: Crypto miners in Texas shut down operations as state experiences extreme heat wave

In July 2022, Riot said it planned to move many of its mining rigs from a New York facility to Texas in an effort to reduce the firm’s operating expenses. Shares of Riot stock closed down 2.3% at $6.68 on the Nasdaq.

Cointelegraph reached out to Riot Platforms, but did not receive a response at the time of publication.

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Argo Blockchain mines 25% less Bitcoin due to winter storm at Helios

Argo Blockchain mined less Bitcoin than expected in December due to the firm curtailing mining operations at Helios amid extreme weather conditions.

Publicly-listed Bitcoin (BTC) mining company Argo Blockchain saw a significant drop in mining activity in December 2022 due to a winter storm in Texas.

On Jan. 11, Argo released its first operational update since selling its flagship mining facility Helios to Mike Novogratz’s Galaxy Digital. The company said it mined 147 Bitcoin or BTC equivalents in December, compared to 198 BTC in November 2022.

The firm said that as of Dec. 31, Argo held 141 BTC, with its December mining revenue amounting to $2.49 million. Argo’s total debt was approximately $79 million and its bank balance was about $20 million.

According to the announcement, the decrease in the amount of mined BTC was mainly due to Argo curtailing mining operations at Helios in response to a major winter storm in Texas.

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In late December, the United States Department of Energy declared a power emergency in Texas, citing a shortage of electricity due to the impact of severe winter weather. Amid a massive temperature drop accompanied by high winds, the demand on the Texas power grid reached an all-time winter peak in excess of 74,000 megawatts (MW).

Argo CEO Peter Wall pointed out that the company’s mining results were lower than expected because the firm had to reduce power usage on the grid due to extreme weather conditions.

Related: Bitcoin miners see mixed successes in tackling debt-fueled overexpansion crisis

During the winter storm, Argo joined other Texas Bitcoin miners in reducing power usage by an estimated 1,500 MW, Wall said, adding:

“After the winter storm and associated freezing temperatures had subsided, we safely brought Helios back online and resumed operations.”

Wall mentioned that Argo eventually decided to sell its Helios facility to Galaxy Digital, announcing the $65 million deal on Dec. 28. The transaction aimed to reduce Argo’s total debt by $41 million and improve liquidity and operating structure.

Despite the sale, Argo will still continue mining at the Galaxy-owned Helios facility. Argo’s total hash rate capacity continues to be 2.5 exahashes-per-second, the announcement notes.

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1.5M houses could be powered by the energy Texas miners returned

Bitcoin miners appeared to be the model consumers for the ancillary services in the state.

During the winter storm in Texas in December 2022, Bitcoin (BTC) mining operators returned up to 1,500 megawatts of energy to the distressed local grid. It became possible due to the flexibility of mining operations and the ancillary services, provided by the state authorities. 

In his commentary to Satoshi Action Fund, Texas Blockchain Council president Lee Bratcher stated that miners returned up to 1,500 megawatts to the Texas grid. This amount of energy would be enough to heat “over 1.5 million small homes or keep 300 large hospitals fully operational,” according to the calculations from the Bitcoin advocacy group.

While there’s no specification regarding the exact time period in which miners have accumulated such an amount of power, the global Bitcoin mining hashrate dropped by 30% on Dec. 24-25, 2022. Miners appeared to be the model participants of ancillary services in the state, which stimulate customers to reduce their consumption during peak demand in order to stabilize the grid.

Related: Public Bitcoin mining companies plagued with $4B of collective debt

The winter storm in North America was so severe that it shut down Binance's cloud mining products from Dec. 24-26. During the days leading up to Christmas, a "bomb cyclone" unleashed extreme temperatures across the United States, leaving millions without electricity and claiming dozens of lives.

Back in March 2022, the Electric Reliability Council of Texas (ERCOT) established an interim process to ensure that new large loads, such as Bitcoin miners, can be connected to the ERCOT grid. Software providers have also begun working with miners to ensure they have the tools needed to properly enable grid balancing.

With its 14% share in Bitcoin hashrate, Texas is among the top states for Bitcoin mining in the United States, along with New York (19.9%), Kentucky (18.7%) and Georgia (17.3%).

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2 Bitcoin Mining Pools Command More Than 53% of BTC’s Total Hashrate

2 Bitcoin Mining Pools Command More Than 53% of BTC’s Total HashrateBitcoin’s hashrate has jumped from the low 170 exahash per second (EH/s) recorded this week, to above the 300 exahash range after a number of bitcoin mining operations from Texas temporarily went offline on Dec. 25, 2022. Furthermore, three-day hashrate distribution statistics recorded on Dec. 29, 2022 indicate that two mining pools command more than […]

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