US Senator Cruz highlighted the role of Bitcoin mining in improving the resilience of the energy grid, especially during periods of extreme weather. He explained that Bitcoin mining machines can be easily and quickly shut down during crises, effectively becoming “emergency power reserves.”
Texas Senator Ted Cruz expressed his support for Bitcoin (BTC) mining operations in the US, emphasizing its potential to improve the resilience of energy networks in times of crisis.
Cruz, a Republican, expressed his optimistic stance on Fox News Radio, according to a post on X (formerly Twitter), dated September 7:
“Texas is a hub for jobs, innovation, and freedom—making it the natural oasis for Bitcoin mining. These operations can improve our grid resiliency since they can shut off during inclement weather and free up electricity to heat or cool homes.”
Bitcoin Mining’s Positive Influence on The Energy Industry
Cruz praised the beneficial influence of Bitcoin mining on the energy industry, specifically focusing on its positive impact on the Lone Star State. But the former Republican presidential candidate’s endorsement comes at a critical time for Texas, which recently experienced its second-hottest summer on record.
Texas subsequently suffered an energy crisis, exacerbated by the sector’s high electricity consumption. Riot Platforms and other large-scale miners like Marathon Digital Holdings have been forced to halt operations during past emergencies, impacting their profitability and sparking debates about their role in the state’s energy landscape.
The state’s power grid operator awarded Riot $31.7 million in energy credits to incentivize the Bitcoin miner to scale back its operations.
Cruz, however, maintains that Bitcoin can play a critical role in conserving energy resources. He noted that Bitcoin mining machines can be quickly shut down in the event of a crisis, effectively becoming emergency power reserves.
He explained that the ability of Bitcoin miners to divert energy resources towards essential needs, such as hospitals and homes, makes them necessary.
Bitcoin Proponents’ Positive Reactions
Dennis Porter, executive director of the Satoshi Act Fund, a nonprofit that advocates for favorable policies for Bitcoin mining, praised Cruz’s stance on Bitcoin.
Porter further highlighted the growing acceptance of Bitcoin among politicians, describing it as a winning issue. He noted that politicians recognize the potential of aligning with Bitcoin to attract new voters and donors while positioning the United States as a leader in innovative technologies. He also noted that despite not always agreeing with Cruz, many Bitcoin advocates appreciate his support of the cryptocurrency industry.
Bitcoin Mining Stocks Rise
Bitcoin mining stocks outperformed cryptocurrencies in the first half of 2023. Data reveals that the top nine publicly traded BTC mining companies have seen their share prices rise by more than 250% during this period, surpassing the Bitcoin performance by more than three times.
It is no surprise that institutional investors, including Vanguard Group, with more than $7.2 trillion in assets under management, have increased their exposure to stocks of top Bitcoin mining companies. Such move suggests growing institutional interest in Bitcoin despite increasing regulatory scrutiny over cryptocurrencies.
Cruz’s support for Bitcoin mining to bolster the resilience of the energy grid in Texas also reflects growing recognition among politicians of the cryptocurrency’s potential benefits.
While both proponents and critics are found in the political arena, the cryptocurrency industry continues to evolve and gain acceptance, attracting interest from institutional and retail investors.
By Leonardo Pérez