Sep 28, 2023

Data sourced from the world's largest mining pool, Foundry, indicates that Texas is the number one U.S. state for mining bitcoin, hosting 28.5% of the country's hash rate.

Video transcript

Data source from the world's largest mining pool. Foundry suggests that Texas is the number one American state for mining Bitcoin hosting 28.5% of the country's hash rate. Foundry and coin desk are both owned by DC G. Joining us now is Foundry Business Development, Vice President, Jeff Berkeley. Welcome to the show. Jeff. Thank you. It's great to be here. It's great to have you here. Now, we're talking all about Texas. The data that was published said that about 30% of the hash rate is there in Texas. Now, this data was compiled in July. So are you expecting that number to be higher or lower right now? Yeah, look, I mean, obviously, uh Texas is and we've had a really hot summer in Texas. And so there's a lot of curtail going on there. So I would, we wouldn't be surprised to see that actually tick up as, as things cool off in the fall. But um you know, it's when we last published this map, uh It's amazing how much it's changed, right? We, we published it towards the end of 21 and at that time, the global network was under 200 X A hash. And we're, we're, we're over 400 X A hash now. So this was a time when uh you know, a few months after the China Ban. So you had all these Chinese miners scrambling and searching the world for the cheapest power. And so it's no surprise that some of them found a home in Texas, right? This is a state that uh you know, his long, long history and, and energy production. And so I think uh miners are always looking for the absolute cheapest power. And so that's, those are the states they're gonna gravitate towards, I'm gonna guess that, that, that power is coming from, not from solar despite all the sunlight that Texas gets. Um does it have to do with the fact that you have a, you have a legislature in Texas? That seems to be, uh let's say not too concerned about uh whether or not we all burned to death uh from, from, you know, look, I, I think there's a lot of solar and wind projects and that's why so much of the mining is taking place in West Texas, you know. So this is, I think what we're learning is that if Bitcoin is, is, is really gonna act as a bridge between where we are today and where we want to be in, in a renewable future. So this um how much, how much of the energy that goes into mining? Do we know, uh comes from renewable sources versus uh uh Texas tea. This is um I, I think that data is approaching 50% is coming from renewables, right? So, and not only is the Bitcoin network getting more uh sustainable from a renewable perspective over time, but the machines themselves are getting more efficient, right? So as the technology improves on the machines, you're getting more, you're getting the same um compute power for weight, you know, for the same energy uh consumption. So this is uh you know, it's been a remarkable how efficient that, that the network has grown from no, from 200 to 400. Um you know, and look to put that move in perspective by the way, that that's 2 million machines that it takes to go from a 200 a hash network to a 400 net net network. So there's a lot of machines moving around the globe. Um And it, it's, you know, we're, we're gonna continue to see this growth. I mean, all three major manufacturers just released, you know, we're kind of going from this era of on the, on the, on the network right now. The average machine is probably somewhere between 30 35 jewels of terra hash on an efficiency basis. And these machines are now sub 20 Jews per terra hash. So it's al almost, almost twice as efficient and, and we're gonna, and those machines are gonna start to shift later. This year and early next year. So again, the network growth is going to continue and and the the efficiency is gonna continue to improve as well. So you mentioned, um miners sort of moving from China to Texas. I'm just curious like where the US now ranks just in terms of a mining power. I mean, you know what we are sort of the big competitors for, for mining now that China isn't as prominent as it once was. I think the US and North America in general is dominating the, the, the Bitcoin network for sure. And I think, um you know, in the US, you kind of see it state by state, right? So Texas, Ohio, Pennsylvania, Nebraska, some of these, these states that are, that are great for mining, have a, have, have a friendly regulatory environment and people and, and, and hence the miners are gravitating towards those states. You know, other states like New York, which is an amazing state for mining as far as uh the temperature, the climate, a lot of hydro energy, cheap power, but the the the regulator regulators there don't want to embrace this technology. And it's um it's, it's unfortunate to see that, but I think, um you know, you're also seeing some of the some of the hash rate move to areas like South America and Africa. And that's, that's the incredible thing about this network and this technology is, it's just constantly going to seek out the most efficient and, and lowest cost energy sources. It's interesting that you talk about North America, uh, dominating mining because, you know, as we know in the US there's been, you know, quite a regulatory crackdown which is obviously related but I guess is there any argument to be made that mining actually creates jobs in the United States in a significant way? Are you seeing that at all? Yeah. It, it does. And I think it, it's creating these um high paying jobs with, you know, a lot of these sites require technicians to run these sites and, and these are in rural areas, right? So these are areas that are uh in desperate need of new job growth. Um And, and again, I think, you know, we're, you know, foundry setting up uh and as a site and, and we're, we're, we're on the ground now uh doing a, a major job there at this site and, and the town's thrilled to have us. So I think, um, you know, the, the, the States and the communities that embrace this technology are gonna win. All right. In other mining news, Bitcoin Miner marathon digital mines, an invalid Bitcoin block recently. They said it was due to a bug during an experiment. Can you just unpack what happened here? Why it happened? Does it mean that uh marathons network is less secure? No, II, I don't think so. I mean, look, this is, um I haven't dug into this too much. I did, I did see this headline but uh you know, marathons use, they're more or less solo or self mining, right. That's their hash rate. They're um, and, and, and there's challenges that come with that and I think that's why a lot of institutional miners choose to use a pool like foundry because we take all that risk and technology, you know, operational technology off of their plates. Um And, and so I just think that, you know, that I think in some ways this shows the beauty of the network, right? Like it's completely transparent and open the minute a trans transaction like this occurs, it's all over Twitter and people on, on, on, you know, coin desk are talking about it. And so there's no, there's no hiding in Bitcoin and I think that's the real beauty here. Jeff, thanks very much for joining us this morning and unpacking that uh data you recently published. Yeah. Oh, thanks. Thanks again for having us. Appreciate it. That was Foundry Business Development, Vice President Jeff Burke.

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