Bitcoin Miners Earn Millions for Shutting Down During Power Crisis

Power Crisis: Bitcoin Miners Earn Millions for Shutting Down Their Computers

The Economist recently highlighted problematic practices within the controversial Bitcoin mining industry, extending far beyond mere energy consumption. ERCOT, the Electric Reliability Council of Texas, pays Bitcoin miners to shut off their computers during periods of high electricity demand. Riot Platforms (NASDAQ: RIOT), a major recipient of these "compensation payments," reportedly earned four times more from ERCOT in August by halting its mining operations than it would have made by continuing them.

This practice has sparked outrage among market observers. Robert Evans, an American author and journalist, argues that the primary profit for industrial-scale Bitcoin mining in Texas stems from state bribes aimed at preventing grid overloads. Ed Zitron, CEO of media and PR group EZPR, suggested on social media that miners should be penalized rather than rewarded for excessive power usage. Kelsey D. Atherton, a military technology journalist, went further by advocating government seizure of miner assets instead of paying millions not to work.

Mass Exodus: Bitcoin Giants Leave Paraguay Due to Rising Costs!

A significant increase in electricity tariffs has led several Bitcoin mining companies to leave Paraguay due to unsustainable new energy pricing structures imposed by recent financial policies. As reported by Crypto News Flash, the National Electricity Administration (ANDE) confirmed multiple shutdowns primarily because firms could no longer operate under these conditions without formally terminating contracts.

Carlos Fernández Valdovinos, Minister for Economy and Finance in Paraguay, expressed opposition to punitive energy prices, indicating internal governmental disagreements over this issue. Fernando Arriola from the Paraguayan Fintech Chamber warned about losing the country's competitive advantage globally if such policies persist. Some companies, like Penguin, are already relocating operations, with Brazil emerging as a preferred destination.

Argo Blockchain PLC Announces 2024 Interim Results

Argo Blockchain PLC announced its interim results for H1 2024, showing revenues increased by 18% year-over-year despite fewer Bitcoins being mined. According to Wallstreet Online, higher global hash rates reduced the bitcoin-denominated hash price. Revenue reached $29 million compared to last year's $24 million, although the total number of Bitcoins mined dropped significantly. This reflects the current economic realities facing the sector, including rising operational costs amidst ongoing regulatory scrutiny worldwide, negatively affecting profitability margins and leading many operators to struggle to stay afloat amid a challenging environment characterized by volatility and uncertainty. The sector is currently experiencing unprecedented turbulence on an unprecedented scale and scope, unseen before in cryptocurrency history, as it evolves in a rapidly dynamic landscape.

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Article Summary

Bitcoin miners in Texas are earning millions from ERCOT to shut down during high electricity demand, sparking controversy over state incentives. Meanwhile, rising energy costs have driven Bitcoin mining companies out of Paraguay, and Argo Blockchain PLC reported an 18% revenue increase despite fewer Bitcoins mined due to higher global hash rates.