The article was one of the best balanced and thought-provoking I have ever read on bitcoin mining. The report focuses on the Greenidge Bitcoin Mining Company in upstate New York. It was the subject of a long-running media campaign last year, when environmental activists claimed that the facility was causing waterways to boil and destroying delicate ecosystems. These claims influenced a policy decision made by Governor Kathy Hochul to restrict bitcoin mining in New York.

Greenidge was a lie in almost all of its worst allegations. CoinDesk’s Nik De and Doreen Wang, along with Cheyenne Ligon, visited Dresden in Upstate New York to assess the situation and talk to locals. They found that no lawmaker had ever been to the rust belt town, or spoken to the mayor, before drafting a bill which effectively froze new bitcoin mining.

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The Bitcoin mining debate has today centered on the Bitcoin network’s impact on the environment. Greenidge was a lightning rod for the Bitcoin mining debate because the equipment that the company used to move into the natural gas plant had been deactivated. This meant that when the miners turned on, they were not just using electricity that would’ve been produced anyhow, but also actively releasing “fresh carbon” into the atmosphere.

Individuals can certainly make up their minds on the matter, but how a state should treat Bitcoin – for example, whether mining a href=”https://www.theblock.co/linked/140343/oklahoma-joins-widening group of us states mulling tax incentives for bitcoin miners” rel=”noopener” target=”_blank”>should be encouraged/a> or banned – is largely based on your perspective. Individuals are free to make their own decisions, but the state’s treatment of Bitcoin, such as whether mining is encouraged, or banned, requires a discussion involving politicians, stakeholders, and those who will be affected.

De wrote in a behind-the-scenes account about how the story was created that he had expected the locals to dislike the plant. His team and he had heard Greenidge pumping pollution into Seneca Lake, and making incessant noise. (This claim was debunked). De’s team instead found that the locals and the surrounding area were in favor of the new business. Greenidge may have created only a few jobs, but every job is important in a small town like Dresden (296 residents).

The few complaints that locals had about Greenidge came from “cottage people”, wealthy out-of towners who own vacation homes along the lakeshore. As taxpayers, these people are entitled to care about the value of their homes, but is their opinion more important? It seemed that way.

Here’s the crux: Behind all the intractable debates over bitcoin mining is a class struggle. Bitcoin was created during the Great Financial Crisis as a way for anyone to have access to a semi-private, electronic cash system that would allow the money supply to always be verified. This was a direct rebuke against banking and the Federal Reserve.

There are many white-collar jobs based around analyzing bitcoin’s price performance and lobbying for new investment vehicles derived from bitcoin. Many white-collar positions are based on analyzing Bitcoin’s price or performance , and lobbying to create new investment vehicles that use bitcoin.

Bitcoin mining has also evolved from something that you could do at home to a capital-intensive industry. If you want to compete in any meaningful way, you will need to purchase hundreds or thousands specialized computers, which draw electricity 24 hours a day. The proof-of work algorithm, which makes Bitcoin possible, also ties it to the ground. These investments are made in real communities.

Greenidge has created dozens short-term construction positions and hired unionized electrical workers. The company has improved Dresden in a variety of ways, such as beautifying the town and repairing a playground for children. Some facilities do not have their converted coal-plants like Greenidge, which require as much labor. However, many create jobs for those who may not otherwise be able to find them.

Greenidge’s words suggest that the Culture War will increasingly dominate the conversations about bitcoin mining and the class system. I’ve been saying for a long time that bitcoin will become a red/blue issue, with Republicans endorsing and Democrats disavowing it. The network will probably always be “credibly neutral,” but the way that we view it and politicize will follow predictable patterns. This has been the case for many topics. Climate change was not a partisan issue before it became one in American politics.

Opinion

In an event to announce his presidential campaign in 2024, Florida Governor Ron DeSantis spoke yesterday about Bitcoin’s “threat” to the current system. DeSantis, despite presenting himself as a populist politician, has received the support of wealthy technologists such as Elon Musk and PayPal Mafia co-member David Sachs. DeSantis’ most notable national accomplishments are the “Don’t Say Gay Bill” and a battle with Disney.

DeSantis’ pledge to “protect” Bitcoin is just as performance-based as his “ban” on central bank digital currencies (CBDCs) (before the Fed even decides whether or not it’s worthwhile fully studying a virtual dollar). It’ll be enough, though, to color people’s perceptions of crypto. This is the same type of feedback loop that allowed environmentalists and New York’s Democratic government to fabricate Greenidge’s ecological footprint.

My colleague Nik De stated that “a conversation without the people directly affected can lead to wonky results.” The only people who have a voice are probably vacation home owners.

CORRECTION: Greenidge has been converted to burn gas.