In a speech at the 2022 Conservative Political Action Conference (CPAC) this week, U.S. Senator Ted Cruz came out unequivocally in favor of Bitcoin. In his speech, he claimed he was bullish, at least in part, because “it is decentralized and uncontrollable.” He added that political parties taking anti-Bitcoin stances are worried about losing control over their citizens, saying “that is why China banned Bitcoin – because they can’t control it.”
Senator Cruz represents Texas, a U.S. state gaining a strong reputation for it’s pro-Bitcoin stance. As the nation’s top energy producer, Texas has become an attractive locale for Bitcoin miners. Indeed, some of the largest Bitcoin mining companies in North America operate mining centers in Texas, including Riot Blockchain, Rhodium Enterprises, Poolin, and Compass Mining. Marathon Digital Holdings, one of the largest publicly traded Bitcoin mining companies in the world, announced in Q2 of 2021 that they had partnered with Compute North to build a facility that could host up to 73,000 miners. In a recently published interview with TechCrunch, Poolin CEO Kevin Pan said “Texas will be the bitcoin capital of the world in the next two years.”
Texas is also home to many major oil and gas companies, including BP, ConocoPhilips, Shell, and Valero Energy. Bitcoin miners are increasingly partnering with oil and gas companies to reduce wasted energy that arises during the oil production process. They do this largely by capturing natural gas that would otherwise be “flared off” and converting it into electricity used to power Bitcoin miners. Earlier this month, ConocoPhilips announced that they have partnered with an undisclosed Bitcoin mining company as part of a pilot project to reduce flaring. Although their project is being run in North Dakota’s Bakken region, similar operations could be performed in Texas.
On top of abundant natural resources and access to the oil and gas industry, Texas has a political climate that supports Bitcoin. In addition to Senator Cruz, multiple gubernatorial candidates in Texas have come out in support of Bitcoin. The sitting governor, Greg Abbott, has made a concerted effort to attract Bitcoin miners to the state. Don Huffines, one of Abbott’s competitors in the upcoming gubernatorial election, recently released a statement saying that he is “committed to making Texas the Citadel for Bitcoin and protecting the industry from the federal government.” Some of these politicians are backing up their words with actions. According to a recent financial disclosure, Senator Cruz bought between $15,000 and $50,000 worth of Bitcoin on January 25th, 2022.