Chamber Summary: Capitol Hill’s First-Ever Proof-of-Work Mining Hearing on the Energy & Commerce Oversight Subcommittee
January 20, 2022
On January 20th, 2022 the Energy and Commerce Oversight Subcommittee held the first-ever hearing on Capitol Hill to focus solely on Proof of Work mining. Witnesses for the hearing included; Ari Juels Weill Family Foundation and Joan and Sanford I. Weill Professor Jacobs Technion-Cornell Institute Cornell Tech, John Belizair Chief Executive Officer Soluna Computing, Inc., Brian Brooks Chief Executive Officer BitFury, Steve Wright Former Chief Executive Officer Chelan County Public Utility District and Bonneville Power Administration, and Gregory Zerzan Shareholder Jordan Ramis P.C.
Following the Chinese government ban of cryptocurrency mining, the United States is now the global leader in hash rate. This is an opportunity for the U.S. to assert leadership on several fronts: securing the Bitcoin network, expanding economic growth via digital asset adoption, and perhaps most important, an unprecedented opportunity to deploy green energy infrastructure that enables a clean energy transition.
The bitcoin mining industry today is spurring U.S. economic growth, job creation, and innovation, especially in rural areas where opportunity and innovation are needed most. This is being achieved while also creating financial incentives for the buildout of renewable energy infrastructure.
Yet these opportunities are sometimes lost in the policy debates with misinformation. While digital asset mining currently uses less than 0.1% of the world’s energy, headlines claim, “Bitcoin Uses More Energy than Many Countries,” or “Bitcoin Mining Makes Senaca Lake Feel Like a Hot Tub.”
The reality is Proof of Work mining, while sometimes being energy intensive, can also be far more flexible with its energy needs, particularly so compared to other energy intensive industries, such as data centers and manufacturing facilities. Key to an abundant, clean energy future, and Chamber of Digital Commerce’s Proof of Work mining industry members are committed to using carbon neutral or renewable resources across the industry and partnering with utilities on growing renewable energy.
The hearing on January 20th offered the Proof of Work industry an opportunity to engage policymakers and share the innovations that are spurring green energy alternatives, while discussing policy frameworks to further encourage a clean energy transition for the digital asset ecosystem.
Congress should take this opportunity to lay the groundwork and chart a cooperative path forward through coordination with the Proof of Work mining industry, as well as the utility industry. Proof of Work miners are unique energy buyers that are extremely agile, highly flexible, and easily interruptible. These “energy buyers of last resort” are a driver of renewable development by creating green energy demand, while providing base-load stability to the grid.
One example of how the industry can benefit the population as a whole is the unique ability to power down, known as “curtailment,” during peak usage for rate-payers. Bitcoin mining can provide a utility with a reliable base load customer that can provide a stable consistent demand to justify build out of clean energy infrastructure. Further, on the rare occasions when customer demand spikes (e.g. during extreme weather events that create heating or cooling peaks) and unlike data centers, cloud service providers and manufacturing facilities, bitcoin miners can work cooperatively with utilities to cut off their power demands for the benefit of the grid in mere minutes with no adverse effects. Proof of Work miners power down to allow critical usage of power at community assets like hospitals and municipal government, or cooling and heating during weather extremes. No other industry that uses the amount of energy as proof of work mining has the capacity to do this.
Bitcoin has been adopted by over 100 million individuals worldwide over its short lifetime and mining is the foundation of this ecosystem, creating an opportunity for millions of people in less fortunate economic circumstances and the unbanked. Cryptocurrency represents a major breakthrough by offering workers and savers a way to protect themselves from inflation and provide access to the financial system by storing their wealth in a medium that is independent of banks, fees, and long-standing inequities in our banking system.
The Chamber and its members appreciate the Energy and Commerce Oversight Subcommittee’s leadership to initiate an open and honest dialogue regarding Proof of Work mining, and we look forward to working with the committee and other stakeholders on this foundational issue that is important to the entire crypto economy.
¹ https://www.nytimes.com/interactive/2021/09/03/climate/bitcoin-carbon-footprint-electricity.html