Lone Star State will be the Silicon Valley of crypto thanks to key legislative victories: President of the Texas Blockchain Council

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The 88th Texas Legislative Session was particularly productive for local Bitcoin miners.

Supporters celebrated the blocking of one state bill and the passage of several others that will likely ensure the state remains attractive to minors.

“The chip was invented in 1958, but this technology was monetized in California,” Lee Bratcher, president of the Texas Blockchain Council, told Decrypt via email. “Texas won’t let that happen again. Texas will be the Silicon Valley of the digital asset industry.”

For one thing, Senate Bill (SB) 1751, dubbed the industry anti-mine bill, never made it to the governor’s office. The bill sought to limit lucrative energy credits enjoyed by local miners, including Riot, which scooped up $9.5 million in credits last July.

Elsewhere, the 1929 Senate bill, which passed, was seen as a victory for the industry.

The bill requires massive bitcoin mines to register with the Electric Reliability Council of Texas (ERCOT). Proponents of the bill see it as a necessary step towards improving transparency.

“We vocally supported SB 1929, which requires large flexible loads over 75 megawatts to register certain details of their load with the grid operator, ERCOT,” Bratcher said. “This bill will prove useful in strengthening communication between ERCOT and Bitcoin miners.”

Texas House Bills Boost Bitcoin Miners

Additionally, two House Bills HB 591 and HB 1666 are also shown as positive for crypto mining. They have passed House and Senate votes and are expected to be signed by Texas Governor Abbott.

HB 591 establishes a tax incentive for the use of flared gas for on-site Bitcoin mining.

Gas flaring is the practice of burning or releasing gas from oil producing wells. This practice contributes significantly to global methane pollution and has serious environmental impacts.

The bill encourages Bitcoin miners to use flared gas as a power source, creating a use case for an energy resource that might otherwise go to waste. But critics warn that using flared gas amounts to new mining powered by fossil fuels.

HB 1666 introduces a proof of reserves regime, requiring crypto exchanges to maintain assets “sufficient to meet all obligations to customers as well as to submit statements to the Texas Department of Banking regarding liabilities.”

In the wake of FTX’s bankruptcy, the move could help bring some skeptical investors back to crypto.

Critics of local industry are less enthusiastic about recent legislative measures.

“From our perspective, what you’re doing here is getting a new stream of value for the industry that otherwise is starting to be priced out of the market,” said Public Citizen’s Texas director, Adrian Shelley, at Decipher.

Public Citizen Texas is a nonprofit advocacy group that has actively lobbied against the burning of coal in Texas as well as the state’s interest in expanding its network of nuclear power plants.

“It’s an industry that doesn’t really bring any clear or tangible value to a state,” Shelley said. “[Whereas] it has all these exotic mechanisms to extract value from it.”

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