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Biden Administration Intensifies Scrutiny over Bitcoin Mining Amid Surge in Price

Posted:Feb 08, 2024 13:14 Category: Blockchain , Crypto , Regulatory , Posted by Content Team

The Bitcoin price surge and energy costs associated with crypto miners have grabbed the critical observation of the White House. Following this scrutiny, the Biden administration is making its first significant move against the crypto mining industry to reduce the energy and environmental impact. This move came after the Biden administration deemed the electricity consumption related to Bitcoin mining as a national “emergency”.

The price of Bitcoin has soared past $43,000 per coin, igniting renewed interest from investors and drawing the attention of US regulators. This has initiated an extensive investigation of the energy use of Bitcoin mining by the US Department of Energy (DOE). Industry insiders predict that the Biden administration’s policies may eventually result in the United States outlawing Bitcoin mining altogether.

“We intend to continue analyzing and writing about the energy implications of crypto mining activities in the United States,”

Joe DeCarolis, EIA Administrator

Administration Inquires into Bitcoin Mining Energy Use

TThe Energy Information Administration (EIA) will start gathering information on Bitcoin miners’ energy consumption over the next week as part of an emergency inquiry. The Biden administration’s interest in Bitcoin mining is related to worries about how much power it consumes and its impact on the environment.

Bitcoin miners utilize powerful computers to verify transactions and maintain the Bitcoin blockchain in exchange for freshly minted coins. In response to a request for an emergency data collection facility approved by the Office of Management and Budget on January 26, Bitcoin miners will have to provide information about how much energy they use.

The EIA also brought attention to the potential “public harm” associated with Bitcoin mining, which necessitates data gathering. The energy usage of the Bitcoin mining sector has drawn criticism, with estimates indicating that it may be as much as some small countries.

Critics argue that this data gathering could be an attempt to impose future regulations on the industry, while supporters claim it is a necessary step to assess environmental impact.

“Recognizing that the emergency collection is experimental and interim with the clear intention that the EIA wishes to construct a new standard collection,” – Office of Management and Budget

Office of Management and Budget

Uncertainty Surrounding Crypto Market

The emergency probe has sparked worries among the Bitcoin and cryptocurrency community. It raises concerns over the long-standing suspicions about the possibility of a widespread government crackdown on the mining sector materializing. Former US presidential candidate and governor of Florida Ron DeSantis issued a dire warning last year, claiming the Biden administration was “after Bitcoin” and may “kill it” completely.

The Texas Blockchain Council stated that the EIA’s latest move to force Bitcoin mining companies to disclose their energy consumption is a direct target of the digital assets industry.

Market participants struggle with uncertainty over Bitcoin’s long-term sustainability as its price varies. According to historical statistics, unstable markets and unfavorable macroeconomic circumstances have had a detrimental effect on Bitcoin values in the past.

Debating the Role of Regulation

The EIA’s probe into Riot Platforms, a Bitcoin mining firm from Colorado, has been denounced by the firm as an unwarranted attack on the digital currency sector. Other mining companies have expressed concerns about potential regulatory crackdowns and their impact on the industry’s future. While some worry that more regulation will hamper innovation and growth, others think it could help stabilize the market.

TechCrunch claims that because there hasn’t been any governmental control of the cryptocurrency sector, there are worries about fraud and even market manipulation. As the Biden administration delves deeper into understanding Bitcoin mining, it remains to be seen how this will shape the regulatory landscape for digital currencies. Radar is used to keep an eye on the evolving landscape of Bitcoin mining and possible government interventions during the Biden presidency.

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