Bitcoin mining

Celsius faces hurdle as judge hints at new vote for Bitcoin mining shift

Judge Martin Glenn reportedly said that the firm’s proposed transformation into a Bitcoin mining business deviates significantly from the deal creditors initially voted on.

Celsius Network, a cryptocurrency lending platform, might need to secure a fresh vote from creditors for its planned shift to a Bitcoin mining venture, suggested a U.S.

The crypto lender provided details on Nov. 30, of its plan to only mine Bitcoin (BTC) once it emerges from bankruptcy, a scaled-down business that reflects guidance from regulators.

According to a report, Judge Martin Glenn, responsible for Celsius Network’s Chapter 11 proceedings, voiced displeasure on Nov.

Judge Glenn reportedly highlighted that the proposed transformation into a Bitcoin mining business deviates significantly from the deal creditors initially voted on, potentially encountering considerable resistance from creditors.

Celsius recently announced a scaled-back post-bankruptcy strategy, narrowing its focus to Bitcoin mining due to the U.S.

Celsius attorney Chris Koenig reportedly contended during the Nov.

As per the report, two customers, proceeding without legal representation, expressed dissent toward the agreement in the court documents, contending that Celsius should undergo complete liquidation instead.

Related: Celsius grants access to withdrawals for eligible crypto holders

Celsius filed for Chapter 11 protection in July 2022, one of several crypto lenders to go bankrupt following the industry’s rapid growth during the COVID-19 pandemic.

Under the new proposal, Celsius creditors are projected to receive a 67% recovery, surpassing the 61.2% under the previous Fahrenheit arrangement, according to court records.

Read more

Solana launches emissions dashboard to spur blockchain carbon footprint transparency

The Solana Foundation has launched a real-time carbon emissions tracker to monitor the Solana blockchain.

The Solana Foundation, in collaboration with data platform Trycarbonara, announced the launch of a real-time tracking dashboard to measure carbon emissions on the Solana blockchain. 

According to a blog post from the foundation, this represents the first “major smart-contract blockchain” to measure carbon emissions in real time. The organization hopes this will spur a trend toward carbon emission transparency in the blockchain ecosystem:

“The Solana Foundation hopes to set a new standard for measuring emissions in blockchain by publishing this data.”

The new dashboard can be found on the Solana Climate website. Trackers there currently display the total node count, megawatt-hours, total carbon emissions average and marginal use, alongside numerous other indicators.

Related: Bitcoin mining and increasing energy bills — Sen. Warren vs. Crypto Twitter

The new dashboard also contains several emissions comparison charts where users can view side-by-side conversions depicting Solana usage versus numerous other emission-producing activities.

Burning a gallon of gasoline, according to the chart, produces the equivalent of conducting 140,416.67 transactions on the Solana blockchain, whereas performing a Google search adds up to one and a quarter transactions.

The data used to power the Solana Foundation’s real-time carbon emissions dashboard is available open-source and is modeled on the estimated carbon footprint of the Dell PowerEdge R940.

Whether other blockchain outfits will adopt similar tracking systems remains to be seen, but this move from the Solana Foundation comes amid increasing global efforts to utilize blockchain technology to monitor carbon emissions around the world.

As part of its “Shaping Europe’s digital future” initiative, the European Commission, a politically independent arm of the European Union’s executive that operates in tandem with the European Council, has lauded blockchain’s ability to serve as a foundation for the accurate measurement of carbon emissions in any sector.

In an article on the EU’s digital strategy blog, the commission wrote, “Blockchain can be utilised through smart contracts to better calculate, track and report on the reduction of the carbon footprint across the entire value chain.”

Meanwhile, in the United States, President Joe Biden recently floated budget plans that would add an excise on electricity used for cryptocurrency mining in the amount of 30%.

Bitcoin mining and increasing energy bills — Sen. Warren vs. Crypto Twitter

“I’ve been ringing the alarm about the risks that Bitcoin poses to our power grids and climate,” said Senator Warren, agreeing with a New York Times article on the matter.

United States Senator Elizabeth Warren blamed the Bitcoin (BTC) mining industry for rising energy prices in American households based on unverified mainstream reporting. However, Crypto Twitter was not ready to let it slide and unanimously decided to clarify the disinformation. 

While Senator Warren has prominently spoken against the crypto ecosystem, the latest dig at Bitcoin mining comes based on a New York Times article. The report accuses Bitcoin miners of cashing in on electricity and indirectly forcing the public to pay the price. The narrative fit Warren’s perception of the crypto industry as she stated:

“I’ve been ringing the alarm about the risks that Bitcoin poses to our power grids and climate. U.S. Environmental Protection Agency and Department of Energy should use their authority to require cryptominers to disclose their energy use and emissions.”

To help Warren rethink and make an informed decision, numerous entrepreneurs responded, trying to fix the misconception. Bitcoin podcaster Stephan Livera straight up dismissed the NYT report, stating that the “NYT report is filled with disinformation.”

On the other hand, MicroStrategy founder and chairman Michael Saylor contradicted Warren’s statement. He explained how Bitcoin mining does not contribute to pollution but helps decrease energy bills.

Others from the Crypto Twitter community sought to tag Tesla CEO and Dogecoin (DOGE) supporter Elon Musk in the conversation, who has been actively trying to eradicate disinformation campaigns on his newly-owned social media platform.

The New York Times was one of the first news publications to become a victim of Musk’s attack against disinformation and propaganda. Twitter recently stripped the verified blue mark from NYT’s primary account after the organization refused to comply with the subscription requirement. Cointelegraph reported on a method to find out who paid for Twitter Blue verification.

Related: Elon Musk reportedly buys thousands of GPUs for Twitter AI project

In a recent FOX interview, Musk revealed the development of a ChatGPT rival known as TruthGPT. According to the entrepreneur, TruthGPT is a large language model that will be trained to explore the mysteries of the universe. In his words:

“I’m going to start something which I call TruthGPT, or a maximum truth-seeking AI that tries to understand the nature of the universe.”

In the interview, Musk told Fox anchor Tucker Carlson that ChatGPT “is programmed by left-wing experts, which train the chatbots to lie.”

Magazine: US enforcement agencies are turning up the heat on crypto-related crime

Montana ‘right to mine’ crypto bill passes the House

The legislation had already passed in the Senate in February and will now make it to the table of Governor Greg Gianforte.

The bill, seeking to enshrine crypto miners’ rights in the United States state of Montana, successfully passed the third reading in the state’s House of Representatives. Now, the only thing required to become law is the governor’s signature.

Bill number 178, prohibiting local authorities from obstructing the crypto mining operations, was passed during the third reading by 64 votes to 35 on April 12. The legislation had already passed through Senate voting in February. It will now make it to the desk of Governor Greg Gianforte. While Gianforte has a right to veto the bill, it’s unlikely he will do so, as he belongs to the Republican party, along with the bill’s sponsor, state Senator Daniel Zolnikov.

The legislation aims to establish a “digital asset mining right” and forbid any discriminatory electricity rates charged to cryptocurrency miners. Additionally, it seeks to safeguard mining operations that take place “at home” and remove the authority of local governments to utilize zoning laws to impede crypto-mining activities.

The bill also bars any extra taxes on using cryptocurrency as a means of payment. It categorizes “digital assets” comprising cryptocurrencies, stablecoins and nonfungible tokens as “personal property.“

Related: How Montana stands to benefit if its pro-crypto mining bill is approved

The amended bill draft contains one significant change compared with the original draft, with section three significantly shortened. The old version of section three occupied almost three full pages and included several articles unrelated to crypto mining. Now, section three outlines three specific areas limiting the power of the local authorities, including a restriction on imposing different requirements on mining centers from those on data centers. Additionally, authorities cannot prevent crypto mining in industrial areas and private homes.

In early April, a bill protecting crypto miners from discriminatory regulations and taxes passed through the Arizona House of Representatives and Senate, and now also awaits the governor’s decision.

Magazine: Inside the Iranian Bitcoin mining industry

Texas’ gold-backed digital currency project: Law Decoded, April 3–10

While Ted Cruz and Ron DeSantis attack the idea of American CBDC, Texan lawmakers propose to create a statewide one.

The topic of central bank digital currencies is in the crossfire of United States politicians, with figures like Ron DeSantis and Ted Cruz trying to prevent them from existing. But what about a statewide digital currency? The first of its kind, a gold-backed state-based digital currency project has appeared in Texas. 

On the same day, two Texan lawmakers introduced identical bills for creating a state-based digital currency backed by gold. Each unit of the digital currency would represent a particular fraction of a troy ounce of gold held in trust, according to the bills. Once a person purchases a certain amount of digital currency, the comptroller uses that money received to buy an equivalent amount of gold. Although neither of the bills has been passed or presented for a vote, both state that the act will take effect from Sept. 1, 2023.

Meanwhile, another bill has been passed by a senate committee in Texas. The bill would largely remove incentives for miners operating under the state’s regulatory environment. Under the bill, crypto firms participating in a program intended to compensate them for load reductions on Texas’ power grid would be capped for anticipated demand of “less than 10 percent of the total load required by all loads in the program.” Certain crypto mining companies would also not receive a reduction on state taxes for participation in the program starting in September 2023.

Regulators announce $10 million settlement with Robinhood ‘for failing investors’

The California Department of Financial Protection and Innovation said that the company behind cryptocurrency and stock trading platform Robinhood will likely pay more than $10 million in penalties “for operational and technical failures that harmed main street investors.” The settlement resulted from an investigation by the North American Securities Administrators Association in conjunction with securities regulators from Alabama, Colorado, California, Delaware, New Jersey, South Dakota and Texas. The platform suffered a series of system outages in March 2020, causing users to miss out on trades while many of its services were unavailable.

Continue reading

Coinbase supports new court action to remove Tornado Cash ban

The U.S. Department of the Treasury faces a renewed legal challenge aiming to overturn its decision to sanction the crypto mixer Tornado Cash. The challenge was filed by six individuals backed by the cryptocurrency exchange Coinbase. A motion for a partial summary judgment was filed on April 5 in a Texas district court, with the Coinbase-backed plaintiffs moving for the U.S. Office of Foreign Asset Control (OFAC) to settle the first two counts from its original complaint filed in September 2022. The counts claimed OFAC exceeded its statutory powers under the International Emergency Economic Powers Act and violated the free speech clause of the U.S. Constitution’s first amendment.

Continue reading

Bill protecting Bitcoin mining rights passes in Arkansas

Continue reading

A bill seeking to regulate Bitcoin (BTC) mining activity in Arkansas has passed in the state’s Congress. It will now move to the governor’s office for approval. Under the legislation, crypto miners will enjoy the same rights as data centers. The bill outlines that Arkansas’ government should not “impose a different requirement for a digital asset mining business that is applicable to any requirement for a data center.” Arkansas’ move follows a similar initiative in the state of Montana, where the Senate passed a bill to protect crypto miners in late March. 

‘Don’t Mess with Texas Innovation’ — Advocates criticize bill removing crypto mining incentives

Lawmakers in a Texas Senate committee moved forward on Senate Bill 1751 on April 4, paving the way for a floor vote for the legislation some have labeled as against crypto miners.

Three crypto advocacy groups have launched a campaign in response to proposed legislation that would remove many incentives for miners operating in Texas.

In an April 10 announcement, the Texas Blockchain Council, Chamber of Digital Commerce, and Satoshi Action Fund called on Texas residents to reach out to lawmakers in opposition to the state’s Senate Bill 1751. The legislation, if passed, would amend sections of Texas’ utilities and tax code to add restrictions for crypto mining facilities.

The campaign, named “Don’t Mess With Texas Innovation” — a play on the state’s anti-littering slogan, which has been used by many lawmakers to describe government overreach — claimed many aspects of the mining bill were antithetical to free market principles. Currently, some crypto mining firms are allowed to participate in a program organized by the Electric Reliability Council of Texas (ERCOT), which compensates them for adjusting their load on the state’s power grid during periods of high demand.

“We need to send a strong message to policymakers that the people do not want protectionist policies that push innovation out of the market,” said Chamber of Digital Commerce founder and CEO Perianne Boring. “At a time when folks here are concerned with the economy, jobs, and a reliable energy grid headed into summer, this bill is the wrong proposal at the wrong time.”

Operations concerning Texas’ power grid have been under increased scrutiny from federal and state lawmakers and regulators since a massive winter storm in February 2021 left millions of residents without power — as well as running water — for days. Such conditions have also contributed to damage to certain miners due to burst water pipes.

Many experts said that it was unlikely crypto firms contributed to the energy crisis in Texas in 2021 due to them temporarily shutting down or scaling back operations as part of the ERCOT program. Some lawmakers, including Massachusetts Senator Elizabeth Warren, have probed ERCOT on the energy usage and potential environmental impact of crypto mining companies.

“Bitcoin mining companies were able to curtail 50,000 megawatt hours of electricity in July 2022 alone to respond to record heat and energy demand, ensuring that Texans could continue to cool their homes,” said the campaign. “No other industry can perform the same service as efficiently or effectively.”

Related: Texas lawmakers propose a gold-backed state digital currency

According to the three crypto advocacy groups, more than 22,000 people in Texas are employed by Bitcoin (BTC) miners. Some of the largest companies include Core Scientific, Riot Platforms, White Rock Management and Argo Blockchain — though Argo announced in December that it would be selling its Texas facility to Galaxy Digital.

Magazine: Crypto City: Guide to Austin

Bitcoin proponents respond to New York Times’ BTC mining report

Bitcoin proponents accused The New York Times of overstating mining companies’ emissions and omitting facts about the growing adoption of renewable energy sources for BTC mining.

The New York Times’ latest report on Bitcoin (BTC) mining, titled “The Real-World Costs of the Digital Race for Bitcoin,” has irked many BTC proponents — some of whom took to Twitter to call out certain aspects of the report, including saying it was “cherry-picking” data.

The NYT article says Bitcoin mining has a “voracious” appetite and claims it uses as much energy as all residences in New York City.

In response, Daniel Batten — a Bitcoin environmental, social and governance (ESG) analyst — pointed toward what he said were two major instances of cherry-picking data alongside neglecting the increased use of renewable energy in the mining sector.

Batten said the NYT article drastically exaggerates the actual fossil fuel use of BTC miners, with emission levels overstated by an average of 81.7%. He added the report was “using overwhelmingly incomplete datasets to support a thesis.”

Batten also mentioned that there are 26 Bitcoin miners in the United States and Canada using 90% sustainable energy to fuel their mining activities, but the NYT article chose just two and focused on the sites least backed by renewable energy.

Troy Cross, another Bitcoin proponent, said the NYT article used “marginal emissions accounting” to prove its narrative, selectively applying it only for carbon emissions, not generation.

Dennis Porter, CEO of the Satoshi Act Fund, noted that the NYT article made a mistake in its initial reporting, naming the incorrect town in which a BTC mining facility in Texas is based. The publication later corrected the error.

Pierre Rochard, vice president of research at BTC mining firm Riot, accused the NYT of using “fictitious fractional-reserve carbon accounting” and “cooking the books to fabricate emissions.” Another Twitter user, Hakan, pointed toward passages they believed to be fear-mongering.

While the high energy consumption required for Bitcoin mining is definitely a topic of debate, mining is significantly important for the blockchain. Not only is it used to verify transactions, it also makes it decentralized and adds a layer of security.

Related: Bill protecting Bitcoin mining rights passes in Arkansas Senate and House

According to the Bitcoin Mining Council report for Q4 of 2022, the Bitcoin network is already a leader in sustainable energy use, with 58.9% of its energy coming from renewable sources.

The Bitcoin network‘s sustainable power mix vs. countries. Source: Bitcoin Mining Council

Bitcoin mining has always been a controversial topic, often fueled by critical articles published by mainstream outlets claiming it has a net negative impact on the environment. However, many Bitcoin proponents see these sorts of reports as hit pieces and are quick to offer an opposing perspective. Meanwhile, some are actively campaigning to change Bitcoin’s mining consensus to the more environmentally friendly proof-of-stake.

Cointelegraph Magazine: Bitcoin in Senegal: Why is this African country using BTC?

Bill protecting Bitcoin mining rights passes in Arkansas Senate and House

The Arkansas Data Centers Act is now moving to the governor’s office for approval. It grants crypto miners in the state the same rights as data centers.

A bill seeking to regulate Bitcoin (BTC) mining activity in Arkansas has passed in the state’s House of Representatives and Senate. The bill will now move to the governor’s office for approval.

According to the bill, the Arkansas Data Centers Act of 2023 intends to regulate the Bitcoin mining industry in the American state, creating guidelines for miners and protecting them from discriminatory regulations and taxes.

Arkansas’ state legislators quickly passed the bill after it was proposed on March 30 by Senator Joshua Bryant. The document recognizes “that data centers create jobs, pay taxes, and provide general economic value to local communities.“

Arkansas Data Centers Act of 2023. Source: Arkansas State Legislature

As per the approved bill, a digital asset miner is required “to pay applicable taxes and government fees in acceptable forms of currency and operate in a manner that causes no stress on an electric public utility’s generation capabilities or transmission network.“

Under the legislation, crypto miners will also have the same rights as data centers. The bill outlines that Arkansas’ government should not “impose a different requirement for a digital asset mining business than is applicable to any requirement for a data center.“

Related: Crypto mining in 2023 — Is it still worth it? Watch Market Talks

Arkansas’ move follows a similar initiative in the state of Montana. In late March, the Montana Senate passed a bill to protect crypto miners operating within the state. The bill intends to protect miners against taxes on digital assets used for payments, and to eliminate energy rates discriminating against home crypto miners and digital assets businesses.

The state of Texas went in a different direction. Its Senate Committee on Business and Commerce passed legislation on April 4 that would essentially remove incentives for miners operating under the state’s crypto-friendly regulatory environment, Cointelegraph reported.

An even more decisive move came from New York in November 2022 when Governor Kathy Hochul signed the proof-of-work mining moratorium into law, banning crypto-mining activities in the state for two years. On a federal level, crypto miners in the United States could eventually be subject to a 30% tax on electricity costs under a budget proposal introduced on March 9 by President Joe Biden aimed to “reduce mining activity.”

Magazine: US enforcement agencies are turning up the heat on crypto-related crime

Sphere 3D files lawsuit against Gryphon Digital Mining after BTC transfer

An alleged Bitcoin spoofing attack is behind the lawsuit between the companies that once considered merging.

Crypto miner Sphere 3D has filed a lawsuit against its partner Gryphon Digital Mining after an alleged spoofing attack led to the irregular transfer of Bitcoin (BTC), according to court documents on April 7. 

“Today we filed litigation against Gryphon, the custodial management services provider of our blockchain and cryptocurrency-related services, for materially breaching the Master Services Agreement (“MSA”) we entered into with Gryphon,” said Patricia Trompeter, the CEO of Sphere 3D, in a statement for investors, adding that “Gryphon has put the Company’s assets at significant risk and willfully violated their contractual duties.”

According to the complaint, Gryphon CEO Rob Chang allegedly wired 18 BTC in January to a fraudster posing as Sphere 3D’s chief financial officer through a spoofing attack. Another eight Bitcoin were sent to the same address a few days later.

In a spoofing attack, an attacker attempts to trick a system or a user into believing that they are someone else through falsifying data, such as IP addresses, email headers or user credentials, to gain access to a system, steal sensitive information or launch further attacks.

In comments to Cointelegraph, Gryphon’s Chang said the company is “aware of the complaint and look forward to defending it vigorously.“ He also stated:

“While we cannot comment on pending litigation, we are confident that our impending response to the complaint — and the documents and other evidence that will come to light in the aftermath — will speak for themselves.“

Sphere 3D and Gryphon have been partners since August 2021. Gryphon manages Sphere 3D’s “crypto mining activities” and maintains “fiduciary duties of Sphere’s digital assets,” said the statement. Gryphon receives 22.5% of Sphere’s gross profit as payment for this work.

Sphere’s statement also suggests that the relationship between the companies that were once considering a merger has deteriorated. Trompeter noted that the filing demonstrates that “we will not be bullied or threatened by the likes of Gryphon.“ The executive stated:

“Gryphon has failed to act with integrity, has failed to honor our contract, and we will hold them accountable.”

Cointelegraph reached out to Sphere 3D but did not receive an immediate response. Both companies claim to be committed to growing crypto mining operations with a net carbon-neutral impact. A merger agreement between the two companies was terminated in April 2022. 

Magazine: Green consumers want supply chain transparency via blockchain

US Bitcoin reaches tentative settlement to reopen Niagara Falls mining facility

After a lengthy legal tussle, the company will have to pay various fees and fines and take extensive noise control measures.

Crypto miner US Bitcoin Corp has come to a tentative agreement with the City of Niagara Falls that will allow it to reopen its mining operation in the city, according to a local news report. A state supreme court judge ordered its plant closed in early March. The settlement still requires the approval of the city council.

State Supreme Court Justice Edward Pace ordered the plant’s closing after “weeks of contentious negotiations” between the city and US Bitcoin on the wording of the order. The order enforced a ruling from another state supreme court judge to cease operations while the city sought an injunction to enforce new city ordinances affecting the plant.

Related: MIT Space Force major proposes Bitcoin mining as cybersecurity tool

Pace found US Bitcoin in contempt of court for ignoring the initial order and imposed fines retroactively to Dec. 9, when it was initially ordered to close. Those fines will total over $1 million, according to the report.

Now the company will have to pay $150,000 in fees to the city, $180,000 to reimburse legal costs and new application fees. In addition, US Bitcoin will have to take measures to reduce noise at the plant, including building a noise-dampening wall and submitting to third-party monitoring.

US Bitcoin is in the process of merging with Canadian miner Hut 8 in a deal announced in February. It also has facilities in Texas and Nebraska. According to its website, US Bitcoin uses approximately 90% “zero-emissions electricity” at its New York plant.

The state of New York imposed a two-year moratorium on new proof-of-work mining operations and licensing renewals for existing ones, unless they operate on 100% renewable energy. The state’s attorney general issued an investor alert warning of the risks of cryptocurrency investing in June.

Magazine: US enforcement agencies are turning up the heat on crypto-related crime