Bitcoin’s network hash rate has fallen by about 25% over the past few days due to Texas grid regulators’ calls for curtailment following the recent cold spell, with the US state now established as a global hub for the industry.
Global hash rate estimates fell from around 600 EH/s on Friday to 450 EH/s on Tuesday, according to data from MiningPoolStats and Blockchain.com, the Jan. 14-17 forecast issued by ERCOT due to extremely cold weather across the region. Consistent with weather warnings until. . ERCOT, the Electric Reliability Council of Texas, operates as the grid regulator for most states.
ERCOT’s warning was followed by formal conservation appeals on Sunday, Monday and Tuesday. “Operating reserves are expected to be low tomorrow morning due to continued freezing temperatures, record demand, and unseasonably low winds,” ERCOT said. “We ask Texas businesses and residents to conserve their electricity use when safe to do so.” . The most recent reduction request yesterday closed at 9 a.m. Central Time.
The hashrate decline means more than 4 gigawatts of power capacity has been scaled back during that period, TheMinerMag previously reported.
Miners, which points to Foundry USA Pool, one of the largest mining pool operators by hash rate, appear to be responsible for about half of the decline, down from about 155 EH/s on Friday before the recovery to 77 EH/s yesterday. MiningPoolStats.
Users of Luxor Mining Pool were also affected by the cold spell, as was Bitcoin mining company Marathon Digital. “Luxor mining partners have significantly scaled back operations over the past few days, including shutting down machines to allocate power to the grid,” Ethan Vera, chief operating officer of Luxor Technology, told The Block.
“Many Bitcoin miners in Texas, including Marathon, have scaled back operations over the past few days to support the Texas power grid and the state’s citizens during the current cold snap. This is exactly how it should work,” Marathon corporate communications said. said Charlie Schumacher, Executive Vice President. Added. “Bitcoin miners are, first and foremost, a technological solution for the energy sector. In Texas, they act as a base load that can be reduced in a matter of minutes to free up energy for others in times of crisis. This is exactly what we have seen in play.” “I’ve been out for a few days.”
Hash rate record. Image: MiningPoolStats.
Texas emerges as Bitcoin mining hub amid Chinese crackdown
Bitcoin miners based in China previously led the world in terms of total hash rate. That dominance plummeted in 2021 as the country began cracking down on the industry, with regulators ordering closures.
Texas has emerged as an alternative hub, and miners at the time argued that mining was as good for Texas as it was for miners because the industry’s flexibility in electricity use could strengthen the state’s power grid, reduce demand during peak periods and inject power during trough periods. It has emerged as an alternative hub. .
Marathon Digital, Riot Platforms, Iris Energy and others have brought Bitcoin mining to Texas in recent years, attracted by cheap electricity, grid incentives and the state’s deregulated energy market. It is one of the companies with concentrated facilities. A report from Foundry last September found that US-based Bitcoin miners using its pools in Texas accounted for 28.5% of the country’s hashrate, by far the largest share of any state and 8.4% in 2021. This figure is more than double the percentage.
Texas Bitcoin miners are also no strangers to state government calls for downsizing. In August, Riot Platforms received a record monthly power and demand response credit worth $31.7 million administered by ERCOT after reducing power usage by more than 95% during the summer heat. Iris Energy also received $2.3 million in energy credits during the same month, largely due to voluntary curtailments at its Childress site in Texas.
Updated with additional comment from Marathon Digital.
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