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The Biden Administration Wants To Create A Registry Of Bitcoin Miners

The Biden Administration Wants To Create A Registry Of Bitcoin Miners

Feb 1, 2024
Marty's Ƀent

The Biden Administration Wants To Create A Registry Of Bitcoin Miners

Earlier today, the Biden Administration announced an emergency data collection initiative targeted at bitcoin mining operations in the US via the US Energy Information Administration, an "independent" sub-agency of the Department of Energy. It seems that the Biden Administration is identifying the electricity usage of the bitcoin mining industry as an emergency that is threatening grid stability throughout the US, as is evidenced by the name of the survey; "Proposed Emergency Survey - Cryptocurrency Mining Facilities". Here is the press release and the official filing from the EIA.

via the EIA

When I read the press release and the filing my initial thought was, "Interesting. Maybe this will turn out to be a net positive for the industry. The EIA has made some pretty naive assumptions and the surveys should conclude that bitcoin miners have provided clear benefits to the grid systems they operate within. Especially those who participate in demand response programs that ensure reliable electricity is available to residential consumers during times of peak demand." But after some thought that initial inclination felt a bit naive. Data from bitcoin miners participating in demand response programs and others taking care of escape methane emissions by mining off-grid using natural gas that would otherwise be flared or stranded and unmaintained has been public for years. There is no need for a forced survey on the industry out of nowhere.

That's when I decided to take a look at the actual survey. Upon review, it proves to be one of the more Orwellian things I've seen come out of this Administration. And that's saying a lot. If you dig into the information that the EIA is requesting, it looks as if the EIA is setting out to create a hyper-detailed registry of mining operations in the United States. Getting as granular as to request specific information about mining fleets and hashrate data. And as with any Dystopian edict put forth by a government gone mad with perceived power, the survey starts out with an overt threat.

Not only does it start with a threat, but it requires that "ALL commercial cryptocurrency mining facilities in the United States" respond. This is utterly insane. Before we opine on the insanity, let's dive into the information the government is expecting the mining industry to fork over.

Miners will be expected to provide information about their companies, where they're domiciled, and the addresses of where their operations are located. As well as a point of contact for the EIA.

The companies will also be required to identify whether they are running operations that involve Proof of Stake or Proof of Work consensus mechanisms.

They will then need to tell daddy government how many mining facilities they operate.

After that, they will be expected to disclose the location of their individual operations, including GEOGRAPHIC COORDINATES, and the amount of electricity that was consumed at the facility all together, regardless of whether or not the miner has any control of the electricity that it is not using.

From there they will have to disclose the percentage of the facility's electricity consumption that was used specifically for mining and doxx their electric service provider.

Next up, they will have to somehow come up with the average percentage of all the electricity dedicated to bitcoin mining at different energy suppliers and, again, doxx them.

And last, but certainly not least, miners will be expected to give detailed information about their mining fleets. The EIA wants to know the number of ASICs miners are running at individual facilities, the models of the miners (which will be determined by cross referencing the age of the miner with different model releases), the amount of energy needed to power those mining machines, and the maximum amount of hashrate they produced during the reporting period.

This is one of the most egregious encroachments on privacy and free markets that I have ever seen. It is so egregious that it is hard not to believe that this survey is anything less than a first step that leads down a path toward an all out attack on the mining industry in the United States. This survey serves as a way for the federal government to tag each individual operation within the country. They are going as far as to demand geographic coordinates from companies.

Funnily enough, the only other country to request information like this from the bitcoin mining industry operating in their borders is Venezuela, and they quickly confiscated operations and began mining for themselves once they knew where all of the miners were located. It would be naive to think that a federal government drunk on debt, losing control of the narrative, desperate for a scapegoat, and cognizant of the threat to its power over the money printer posed by bitcoin's success would not resort to similar tactics.

If you are an operator in the bitcoin mining industry in the US it is imperative that you ignore this survey and tell the EIA, the Department of Energy, and the current administration to fuck off. Bitcoin miners are law abiding electricity purchasers who are engaging in mutually beneficial economic contracts with power providers who are trying to optimize their revenue streams so that they can profit more and invest in providing more reliable services to their end customers. The continued attempts to discriminate against the bitcoin mining industry should be seen as nothing less than harassment and unconstitutional.

With that being said, this should be and has been expected for many years. What was once a hypothetical "what happens when the government begins creating a registry of miners?" is now a reality and the reaction from the industry will dictate the fate of bitcoin mining in America. Companies can either succumb to the run-of-the-mill fear tactics employed by the government or stand in solidarity to fight for our inalienable right to not be discriminated against and engage in economic activity with other consenting, supposedly free, companies.

The industry set a good precedent of solidarity last week when a number of companies cosigned many letters in response to FinCEN's proposed rules around the usage of bitcoin privacy tools.

Our Response to FinCEN on Proposed Surveillance Rules for Bitcoin
We submitted a legal response to the U.S. Department of the Treasury and FinCEN’s proposed rules that would seriously harm privacy by effectively prohibiting basic bitcoin best practices such as not reusing addresses and collaborative bitcoin transactions.

The government only gave us a week's worth of rest before dropping this survey. Well, freaks, it's time to get back on the horse and let the government know that this act of egregious aggression that singles out a particular electricity consumer will not stand. The bitcoin mining industry is doing nothing wrong and it should not have to respond to a survey that is attempting to paint us as bad actors. As I stated earlier, the data is already out there and it is abundantly clear; bitcoin miners are a massive boon to the energy systems of this country both on and off-grid. Entrepreneurial spirit and a drive to make the world a better place has begun to fix systemic problems that government policy created in the first place.

If the government is truly worried about the robustness of the energy systems in the United States it should get out of the way. All of the subsidies thrown at "renewable energy" have created perverse economic incentives that favor unreliable energy generation over reliable base load. They have actively hindered the proliferation of nuclear energy for decades with layers of red tape that make it almost impossible to build new nuclear reactors. They have prevented us from drilling for oil and gas on federal lands and halted the construction of pipelines that would increase the accessibility and decrease prices mid-construction. Just last week they issued a mandate to stop the construction of LNG facilities that have allowed the United States to become a net-exporter of energy over the course of the last decade. LNG saved Europe two winters ago after we blew up the Nord Stream 2 pipeline.

The United States federal government is objectively the biggest threat to energy security in America. It isn't bitcoin miners. Don't show them any respect by responding to this survey. They do not deserve it.

Final thought...

I haven't had adrenaline coursing through my vains like this while writing in a long time. It's a great feeling.

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