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Fidelity, Saylor, Dorsey write to EPA to defend Bitcoin mining

Fidelity, Saylor, Dorsey write to EPA to defend Bitcoin mining

These machines, also known as mining devices, work 24 hours a day to find new units.

Benjamin Hall | CNBC

Jack Dorsey (Tom Lee) and Michael Saylor, some of the most prominent names in bitcoin, have joined forces to refute claims by House Democrats asking for the Environmental Protection Agency’s investigation into the environmental effects of crypto-mining.

Bitcoin works on a proof of work (PoW) mining model. This means that miners around world use high-powered computers to create new bitcoins and verify transactions. While proof-of work mining requires sophisticated gear, lots of electricity, and is almost synonymous with Bitcoin, ethereum has used this method to secure its network for at most for a few months.

Representative Jared Huffman (D.Calif.), and nearly two dozen House members, Legislators, wrote to EPALast week, the regulatory body was asked to ensure that mining companies adhere to the Clean Air Act/ Clean Water Act. This was in response to “serious concern” over reports that cryptocurrency facilities across the country were polluting communities and making a large contribution towards greenhouse gas emissions.

Monday morning’s rebuttal letter to EPA Chief Michael Regan was sent by a mix of Bitcoin miners and industry experts. It also includes firms like Benchmark Capital and Fidelity Investments.

One, the letter slams lawmakers for confusing data centers and power generation facilities.

According to the rebuttal, data centers that host miners are no different from data centers operated by Amazon. Apple. Google. Meta. And Microsoft. Each is a building that supplies electricity to power computing workloads.

The letter states that “Regulating what data centres allow their computers to do would represent a major shift in policy in America.”

Darin Feinstein co-founder of Core Scientific, a cryptocurrency mining operator, said that they are confusing the public. He is also one of the primary contributors to the letter. “The pollution comes out of the energy generation source. All data centres buy electricity off-site upstream.”

Feinstein stated that if EPA wants energy generation regulation, there are already channels in place for energy generation facilities to be regulated at the federal, state and local levels.

“It would be very unusual to have the EPA regulate the type computations that are occurring in a data center.” This is clearly beyond their remit,” Nic Carter of Castle Island Venture, who wrote the rebuttal, said to CNBC.

Carter said, “It doesn’t make any sense for the EPA to inquire about what type of computation is being performed.”

According to the rebuttal the EPA regulates power stations, but very few PoW mining companies own the power production.

“The letter makes it sound as if there are a bunch of these vertically-integrated miners like Stronghold or Greenidge…but that is a small portion of overall havehrate,” Carter continued, referring to an industry term used to describe the computing power for all miners in bitcoin’s network.

Huffman and his House colleagues also have issues with the specialized computing hardware. They claim that it creates major electronic waste challenges as millions of devices rapidly become obsolete, leading in large quantities of electronic waste.

According to the letter, bitcoin mining alone generates around 30,700 tons of electronic garbage annually. The letter states that the industry must be held responsible for this waste and should be discouraged from creating it.

This morning’s note to the EPA refutes the ewaste claim. It states that legislators cited a widely criticized study that made bold assumptions about the depreciation timeline of mining rigs. The letter states that the assumption of a depreciation period of 1.3 years is “extremely short”. It also suggests that lawmakers will periodically scrap the entire fleet of rigs.

It is unclear if the EPA will engage in the larger debate on proof-of work mining. CNBC reached out to the agency for comment but they did not immediately respond.

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