Fort Worth began cryptocurrency mining over two years ago. What were the results?

Fort
Worth
is
becoming
a
cryptocurrency
destination.

An
influx
of
cryptocurrency
businesses
now
call
Cowtown
home
—
and
Fort
Worth
is
embracing
them.
Experts
and
Fort
Worth
officials
attribute
that
growth
to
the
city’s
decision
to
bring
a
bitcoin
mining
operation
to
City
Hall
in
April
2022. 

“For
Fort
Worth,
the
municipal
bitcoin
mining,
I
think,
created
this
tech-hub
energy
that
the
city
needs
to
continue
to
build
on,”
said
Brandon
Chicotsky,
an
assistant
marketing
professor
at
Texas
Christian
University.

Carlo
Capua,
the
city’s
chief
of
strategy
and
innovation,
said
that
effort
and
Texas’
favorable
business
practices
spurred
companies
to
set
up
shop
here.

“Fort
Worth
is
innovative,
it’s
forward
thinking,
it’s
not
afraid
to
try
dynamic
things
to
position
itself
as
a
great
home
for
entrepreneurs,”
Capua
said.
“You
can
talk
theoretically
sometimes
about
why
your
city’s
great,
and
(the
program’s
success)
is
a
perfect
opportunity
to
give
a
real
specific
example
of
how
we
are
putting
our
money
where
our
mouth
is.”

Tangible
effect

Advanced
Crypto
Services
is
one
of
the
companies
that
moved
to
Fort
Worth
in
the
last
two
years. 

Started
in
the
garage
of
founder
and
CEO
James
Scaggs
in
Frisco,
the
maintenance
and
repair
bitcoin
mining
company
is
a
startup/nonprofit
member
of
the
Texas
Blockchain
Council,
an
organization
dedicated
to
promoting
blockchain
technology.

Fort
Worth’s
relationship
to
the
cryptocurrency
industry
played
a
factor
in
Advanced
Crypto
Services’
move
and
has
been
a
net
positive,
Scaggs
said.
The
business
gained
access
to
local
opportunities,
grants
and
programs.

The
company
also
got
closer
to
clients. 

Businesses
are
moving
to
Tarrant
County
to
be
closer
to
where
the
mines
are
being
built,
Texas
Blockchain
Council
President
Lee
Bratcher
said.

“Just
like
Fort
Worth
was
the
nearest
city
to
the
oil
field
—
you
ended
up
having
a
lot
of
oil
and
gas
folks
that
landed
in
Fort
Worth
—
I
think
there
is
a
possibility
for
Fort
Worth
to
become
a
bitcoin
mining-centric
city,”
Bratcher
said.

No
federal
registry
for
cryptocurrency
mine
locations
exists.
However,
websites
have
collected
information
based
on
news
articles
and
press
releases.
Data
compiled
by
Fractracker
Alliance
in
November
2022
found
23
mines
in
the
state
that
are
either
operating
or
under
construction,
including
10
near
Midland
and
Odessa
in
West
Texas.

Several
of
the
mining
facilities
are
considered
large,
with
many
having
a
capacity
of
over
200
megawatts,
according
to
an
analysis
by
the
U.S.
Energy
Information
Administration. 

Texas
leads
the
nation
in
large
mines,
with
10
that
use
enough
power
to
support
more
than
30,000
homes,
according
to
The
New
York
Times.
Thirty-four
mines
across
the
country
use
more
power
than
30,000
homes.
New
York
is
second,
with
four.

By
moving
to
Fort
Worth
in
September
2022,
Scaggs
said
Advanced
Crypto
Services
is
primed
to
serve
mines
across
Texas.

“It’s
pretty
well-located
to
the
miners
that
are
out
toward
Abilene,
also
Midland-Odessa.
It’s
not
crazy
far
down
toward
Austin,
which
is
where
we
have
another
good
like
batch
of
customers,”
Scaggs
said.

Long
before
the
city
itself
joined
the
market,
the
world’s
largest
bitcoin
ATM
operator,
Coinsource,
was
founded
in
Fort
Worth
in
2015. 

Consensys,
a
blockchain
software
company,
announced
its
relocation
to
the
city
around
the
same
time
as
the
2023
North
American
Blockchain
Summit
in
Fort
Worth.

The
state’s
“pro-crypto
policies”
and
the
vibrant
entrepreneurial
ecosystem
in
Fort
Worth
prompted
Consensys’
move
from
New
York,
said
Simon
Morris,
chief
strategy
officer
at
Consensys.

“It’s
encouraging
to
be
surrounded
by
a
community
that
values
innovation
and
economic
independence,”
Morris
said
by
email.

Double-edged
sword

Fort
Worth’s
bitcoin
mining
program
began
in
2022
with
three
machines
donated
by
the
Texas
Blockchain
Council.
Two
months
in,
the
city
replaced
the
miners
with
a
donated
newer
machine. 

When
the
pilot
program
concluded
in
November
2022,
Capua
called
it
a
success
and
recommended
the
machines
continue
mining.
The
launch
of
the
program
generated
more
than
752
million
web
impressions
in
those
first
six
months,
according
to
city
officials.

Despite
the
positive
effects
of
the
program,
Bratcher
said
Fort
Worth
is
still
the
only
city
to
participate.
The
Texas
Blockchain
Council
donated
a
machine
to
the
city
of
Temple
in
central
Texas,
but
the
city
never
installed
it,
he
said.

Bratcher
doesn’t
think
cities
will
mine
for
profit.
However,
he
does
think
municipal
power
districts
may
participate
more
in
the
industry.

“There
are
municipally
owned
power
generation
that’s
underutilized
and
they
could
monetize
that
for
the
citizens
of
their
community
more
effectively,”
Bratcher
said.

One
example
is
currently
occurring
in
Denton.
Bitcoin
mining
company
Core
Scientific
started
tapping
into
an
underused
section
of
the
Denton
Municipal
Electric
power
grid
in
2022.
Recently,
Denton
agreed
to
a
second
mining
center
that
will
also
pull
from
the
power
grid.

The
city
of
Fort
Worth
has
done
its
best
“to
educate
the
public”
on
the
pilot
program,
Capua
said.

However,
the
city
has
not
disclosed
the
total
energy
cost
of
running
the
machine.
The
Report
filed
an
open
records
request
for
the
machine’s
electricity
costs,
but
did
not
receive
a
response
by
time
of
publication. 

“Our
rate
with
our
energy
provider
is
confidential,
so
I’m
afraid
I
can’t
share
the
total
electricity
cost
as
it
would
be
easy
for
someone
to
reverse
engineer
our
rate,”
Capua
previously
told
the
Report. 

Future
of
Fort
Worth’s
crypto
investment

Fort
Worth
has
no
plans
to
purchase
more
miners,
Capua
said.
The
city’s
current
bitcoin
machine
has
a
shelf
life
of
about
four
years
and
has
been
operational
for
more
than
two
years. 

The
primary
cost
for
the
machine
is
electricity,
which
was
offset
by
the
mined
bitcoin,
Capua
said.
In
August
2023,
Capua
said
the
machine
had
generated
nearly
$2,000
after
electricity
costs
and
recently
confirmed
the
amount
of
profit
the
machine
has
made
is
“in
the
thousands.”

“We’re
still
able
to
be
profitable
with
that
machine.
So
we’ll
probably
just
keep
that
machine
going
until
it
becomes
completely
obsolete,”
Capua
said.

If
the
machine
stops
working
or
can
no
longer
compete
with
other
miners,
Capua
said
the
city
will
then
evaluate
next
steps.

He
also
said
the
machine
will
stay
at
the
current
City
Hall
at
200
Texas
St.,
despite
current
plans
for
the
remainder
of
city
operations
to
move
to
new
City
Hall
at
100
Fort
Worth
Trail
in
the
next
couple
of
months. 

Chicotsky,
the
TCU
professor,
said
Fort
Worth
can
now
make
a
claim
to
be
more
technologically
savvy
in
“a
way
that
is
responsible
and
likely
generating
revenue
for
the
city
and
for
its
residents.” 

Capua
wants
to
continue
boosting
the
city’s
reputation
as
pushing
the
boundaries
of
innovation. 

Last
year,
the
city
adopted
a
policy
defining
the
appropriate
and
responsible
uses
of
artificial
intelligence
for
the
municipal
government.
The
goal
was
for
the
city
to
outline
the
ways
AI
could
be
used
in
several
city
departments,
Capua
said.

Other
emerging
technology
may
help
the
city
and
its
residents,
Capua
said.

“It’s
really
looking
at
how
we
can
take
a
peek
around
the
corner
to
deliver
services
better
to
our
residents
here
in
the
city,
and
our
visitors,”
Capua
said.

Ismael
M.
Belkoura
is
a
reporting
fellow
for
the
Fort
Worth
Report.
Contact
him
at

[email protected].
At
the
Fort
Worth
Report,
news
decisions
are
made
independently
of
our
board
members
and
financial
supporters.
Read
more
about
our
editorial
independence
policy

here.

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