Nuclear Bulls and a New Form of Baseload 🐂

In this week’s newsletter, we look at miner-friendly regulations, again, this time in the Treasure State. Also, hashrate ATHs and new investments in US Bitcoin mining.

Here's what happened in the world of mining this week:

• Montana passed a bill protecting miners 🧱 

• New hosting site operator in Wyoming and Texas 🖋️ 

• What is Bitcoin’s full potential 📘 

• Poking holes in Cambridge’s study of the network 🔍️ 

• Some more summaries of great podcasts, this time about nuclear 💚 

Block 777,777 came and left.

Montana Senate Passes Bill Protecting Crypto Miners ⛏️ 

The legislation will likely upend a Missoula county zoning law that was one of the first in the U.S. to target the mining industry.

• Montana State Senate passed a bill protecting crypto miners with a 37-13 vote.

• The bill protects at-home mining, prevents discriminatory utility rates for miners, and exempts crypto used as payment from additional taxes.

• The legislation takes power from local governments to prevent them from moving against at-home mining or retroactively using zoning laws to shut down active operations.

• The new law might upend a 2020 Missoula County zoning ordinance that required bitcoin miners to buy or build renewable energy assets equivalent to their energy consumption.

• Bitcoin miners have faced criticism for their potential impacts on carbon neutrality goals and electrical grids.

• As many as five bills are going through state legislatures to protect the crypto-mining industry.

• Satoshi Action Fund helped draft the language in the bill.

New Hosting Sites to Fill the Gap 🏗️ 

Sabre56, a company that consults miners on the development and operations of facilities, raised 35MUSD to build its own hosting sites.

• They are aiming to have 150MW of energy capacity ready by the end of the year.

• The first four sites will total 115 MW and be located in Wyoming and Texas, where construction has already begun,

• The capacity will be built in 7MW-15 MW of monthly increments, with the first batch coming online in mid-March, company CEO Phil Harvey said.

• The 35MUSD investment is coming primarily from private individuals, he added.

Bitcoin’s full potential valuation 🕰️ 

This is an article series by Jesse Meyers Croesus_BTC asking the important questions:

1. What is causing Bitcoin’s value appreciation and volatility to-date, and will that driver continue into the future? (Answered in Bitcoin’s value appreciation engine: increasing scarcity)

2. How high can it go? Where is the ceiling for Bitcoin? 

Number two is discussed in the article below, these are the key takeaways:

1. Bitcoin is competing with store-of-value assets. That means gold, but also bonds, real estate, and equities.

2. The other assets have a continuous supply creation, year by year that needs to be absorbed by the market.

3. For Bitcoin, due to the diminishing nature of the supply creation over time, the market has to absorb half as much supply from mining every four years.

4. The article continues to discuss the unique properties of Bitcoin as a store-of-value and construct a TAM (Total Addressable Market) to estimate the full potential of Bitcoin.

5. Please give it a read, link below:

Daniel Batten Pointing Out Holes in Cambridge's Study 💚 

• Daniel Batten argues for Bitcoin being a good ESG investment in this article.

• Contrary to a Cambridge University study (37.6% sustainable energy), Bitcoin mining leverages 52.6% sustainable energy, making it an appealing ESG investment.

• The 2022 Cambridge Centre For Alternative Finance’s (CCAF) study on Bitcoin’s environmental impact underestimates the amount of sustainable Bitcoin mining going on.

• CCAF model does not factor in:

  • Off-grid mining (impact: plus 10.8%)

  • Flare-gas mining (impact: plus 1.0%)

  • Updated geographical hash rate (Kazakhstan miner exodus, impact: plus 1.8%)

Nuclear Bulls and a New Form of Baseload ⚡️ 

WBD - Anthony Jared, Nuclear Energy Expert and Former US Naval Nuclear Operator

In the year 1979, there were 234 nuclear reactors under construction. In 2022 there were just 59..

• Anthony Jared: Nuclear Energy Expert and Former US Naval Nuclear Operator, Chemistry, and Radioactive Prevention. Also spent time on Nuclear Powered Vessels and Submarines.

  • Bitcoin Bull, Nuclear Pull, Renewable Bull.

• Nuclear-powered ships are built for combat warfare - never had an explosion.

  • Although it is possible - weather and pressure are bigger risks than an explosion.

• Mining uranium basics: enriched to 3-5% for a reactor to work (Uranium 235).

  • In order to make an explosive reactor uranium would need to be enriched to 80%.

• Two reactors, about the size of two minivans, can power an aircraft carrier CARBON FREE.

  • “This is the technology we should be using to power our home.”

  • The recent Gas Explosion in Ohio is an example of how other sources of electricity have higher risks.

  • Battery mineral extraction critics should also be nuclear bulls.

• Explosions don’t happen in today’s world with new technology.

  • Neutrons need to be absorbed from the fuel to stop criticality with rods (Fukushima).

  • Now they have gravity feed cooldowns and much better technology to mitigate the risk of release.

• Anthony Jared give us a damage perspective of Chernobyl:

  • 46 people died at Chernobyl.

  • 7,000,000 people die from air pollution per year globally.

  • 11,000,000 die from poor diet, lack of exercise, and obesity.

• All-In Costs Estimates.

  • Nuclear $40-$50 per Megawatt.

  • Solar + Storage $100 per Megawatt.

  • Off-Shore Wind $100 per Megawatt.

• Green Washers use probability risk for fossil fuel-related emissions, but they don’t apply the same logic to nuclear.

• Fission and hydrogen are still far away

• Economics Drive Policy - Politicians will make changes around Nuclear Policy once they are incentivized

• The waste problem?

  • Radioactive waste and release is worse at Coal plants than at nuclear Plants

  • 800 pounds a year of Coal Waste.

  • 2 pounds in nuclear waste over the live of the reactor

Fixin’ to Mine Bitcoin 🤠 

WBD - Lee Bratcher Texas Blockchain Council

• Texas Blockchain Council recently was named in a letter from Senator Warren.

• Texas produces 18x more renewable energy than Massachusetts and has invested more money in renewable energy than any other U.S. state.

• Bitcoin miners are a buyer of first and last resort for stranded power.

• 8M MWh of wasted energy in the US in 2022; Bitcoin miners can use this energy while reducing emissions.

• Bitcoin Miners receive zero state subsidies. Senator Warren calls out Bitcoin mining “subsidies” – the author of the letter uses the incorrect word for curtailment.

• ERCOT is truly a free market without a price cap like PJM, NYISO, NE-ISO.

  • Residents in New England pay more for their electricity because of national resistance to using Canadian natural gas.

  • As a result, constituents are paying over 0.20/kWh in some regions’ peak/off-peak.

• 8% of the Texas Grid is nuclear – future opportunities for nuclear to provide a reliable base load.

• According to TBC Poll Democrats are more likely to own Bitcoin in Texas.

  • 54% of Texans between the age of 18-34 own digital assets.

  • Pro Bitcoin Democrats: Ro Khanna, Darren Soto in Florida, Sen Ron Widen.

• At the State Level in Texas, Representatives earn $7k per year – they need a second job unless they have an established business or family money. Usually, national reps are people looking to make headlines or “show boaters”.

Moving Forward

• TBC is pushing Exchanges to work with Texas Legislators

  • Proof of Reserves, transparency, level playing field.

  • Lee to exchanges: “If you’re not at the table, then you are on the menu”.

  • Every exchange will comply in Texas because it’s 15% of the national market.

• Joint resolution from the Texas legislature that would condemn CBDC’s.

• Texas & Florida vs CA & NY - These are the states with the most congressional and country-wide influence.

  • TX / FL: have a track record of passing digital asset legislation. Their stance is formalized and has wide-ranging support.

  • CA / NY: Poor track record and has traditionally been resisting the acceptance of digital assets

• Introducing a New Flared Gas Bill

  • Exempt severance tax if the gas was formally flared and used for the onsite generation behind the fence

Market Data 🌎  

Mining Market Report - Bitcoin Magainze Pro

Bitcoin Magazine Pro provides us with a great Public Mining Update. Great update from Dylan LeClair.

• Declining trends of 32% in bitcoin holdings.

• Hashrate ATHs.

• Public miners making up nearly 25% of all hash rate on a given day.