Bitmain Suspends Work on Bitcoin Mine in Texas
Bitmain, the largest manufacturer of cryptocurrency mining rigs in the world, has suspended all of its operations in Texas, where the company was supposed to build the largest mining operation in the country, Texas Public Radio reported on January 11, 2019.
The Future of Bitmain’s Texas Site Uncertain
The Alcoa power plant, site of Bitmain’s mining operation in Texas
(Source: Texas Public Radio)
Chinese manufacturing giant Bitmain has reportedly halted all of its operations in Texas, where it was building a cryptocurrency mine. The mine, located in the Alcoa power plant and smelter outside the tiny industrial town of Rockdale, Texas, was supposed to be the largest mine in the country once finished.
The future of the county remains uncertain, as it has been struggling since two of its largest employers had shut down, Texas Public Radio reported. The county had already lost an estimated 30 percent in tax base, and could be looking at more losses in 2019, the report said.
Milam County Judge Steve Young told TPR that there are currently five employees at the Rockdale site, down from around 15 in July 2018. “They have spent millions thus far to renovate the buildings,” Young said:
“I’m told there are 7,000 or 8,000 servers out there already.”
Bitmain Could Be Scaling down its Texas Operation
According to Young, the “precipitous drop in the value of bitcoin” forced the company to halt its Rockdale operation. Bitmain announced they will be investing over $500 million into the Alcoa power plant, bringing around 400 jobs to the county in July 2018, when Bitcoin was worth over $8,000.
With the coin’s price now hovering around $3,600, the company is experiencing significant financial difficulties. Bitmain has reportedly laid off half of its workforce and has closed down its operation in Israel.
While no official comment has been made yet, a spokesperson for Bitmain told Young that staff reductions were happening across the company, but that the Rockdale operation will continue to work.
“The right-sized team at Rockdale now has the expertise to re-start the project at small scale anytime. Bitmain would like to ramp up the site at a slower pace and scale based on market conditions,” a Bitmain spokesperson said in an email.
Rockdale City Manager Chris Whittaker told TPR that he was hopeful the company would continue to reside in Rockdale, as it could bring more tech companies to the area.
The county’s relatively cheap electricity, paired with the existing industrial infrastructure at the Alcoa power plan,t make the area especially attractive to mining farms.