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Bitcoin Government United States

The First US City Government to Mine Bitcoin? Fort Worth, Texas (cnbc.com) 63

"Fort Worth, Texas, is now the first city government in the United States to mine bitcoin," reports CNBC.

"[A]nd in an almost poetic devotion to the initiative, Mayor Mattie Parker oversaw the construction of a small mining farm in City Hall." Three Bitmain Antminer S9 mining rigs will run 24 hours a day, seven days a week, in the climate-controlled information technology wing of Fort Worth City Hall. The city says the miners will be hosted on a private network to minimize the security risk....

Each of the program's three machines will consume the same amount of energy as a household vacuum cleaner, according to city estimates. While the mayor doesn't expect the three miners to be major money makers, the cost of electricity needed for the program is expected to be offset by the value of bitcoin mined.... To make it happen, the city has teamed up with a few key partners, including the Texas Blockchain Council, which donated the three mining rigs (each valued at roughly $600 apiece), and Luxor Technologies, a mining pool, which lets a single miner combine its hashing power with thousands of other miners all over the world to increase their chances of earning bitcoin....

After six months, Fort Worth will re-assess and decide whether to sink real cash into building out a mine .

Luxor's VP of business development argues that Fort Worth's move "is setting an example and effectively de-risking both bitcoin mining and bitcoin treasury strategies for every other mayor in the country."
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The First US City Government to Mine Bitcoin? Fort Worth, Texas

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  • by cats-paw ( 34890 ) on Sunday May 01, 2022 @09:37AM (#62493952) Homepage

    what is the point of this ?
    doesn't the mayor have more important things to do ?
    couldn't whatever effort being used for this completely, totally worthless endeavor be used for something productive ?
    wtf is wrong with people ?

    • FOMO (Fear Of Missing Out)
      • by gweihir ( 88907 )

        FOMO (Fear Of Missing Out)

        Ah, yes. That one is strong with the stupid. You can sell almost anything to some people using it.

    • Re: (Score:3, Informative)

      by Anonymous Coward

      Yeah, from the same party who passed a law allowing the rapist to sue the victim if she gets an abortion.

    • by rsilvergun ( 571051 ) on Sunday May 01, 2022 @09:54AM (#62493996)
      and they're throwing it around to buy off Texas politicians. This is him signaling that he's open for business, i.e. bribes.

      In Arizona there's a small town (Page?) that is on the brink of having it's water cut off in favor of local Agribusinesses. The amount of water involved is a pittance, but the agribusinesses still want it because every drop is profit in their eyes. Like that old verse in the bible about leaving some grapes for the peasants but in reverse.

      Texas is going to face the same but for power. The bitcoin miners aren't gonna wanna stop making money just because there's rolling blackouts. The reason they're attracted to Texas is the extreme corruption coupled with a voting public that seems A-OK with it means they can set up shop, make a mess of the already strained power grid, and then when the shit hits the fan they'll get their power while everyone else gets screwed. They know that if they tried that B.S. in any other state they'd get kicked out (or in the case of the South they don't have the infrastructure for it)

      Basically, crypto miners are parasites, only able to exist because of lax financial regulation and heavy gov't subsidies on power combined with politicians willing to take risks with the grid (and people's lives during extreme weather events). But America is rapidly becoming a non-functional kleptocracy, so we're gonna attract these kind of parasites. The whole country needs to political equivalent of a flea dip.
      • by gweihir ( 88907 ) on Sunday May 01, 2022 @10:31AM (#62494108)

        Basically, crypto miners are parasites, only able to exist because of lax financial regulation and heavy gov't subsidies on power combined with politicians willing to take risks with the grid (and people's lives during extreme weather events). But America is rapidly becoming a non-functional kleptocracy, so we're gonna attract these kind of parasites. The whole country needs to political equivalent of a flea dip.

        And that is the core of the matter. If crypto miners had to pay realistic prices, including paying for their environmental impact, none would exist. Well, in a sense proof-of-work crypto-"currencies" are one of the last "Climate change? What climate change?" parties to be celebrated before things start to get really, really dark.

      • Texas' congress is part-time with low stipends. Texas' congressmen are very cheap to bribe (aka campaign contributions). Too cheap. Gary Bradley proved that for just $1M in the 80's a person could get insanely unconstitutional legislation passed in Texas. For instance the creation of a local government that was effectively an arm of the state with a Governor appointed board in order to get out of having to obey development rules of the City of Austin. A city where the residents couldn't vote for their
        • Really this. If I remember right uber/lyft spent 100M on ad campaigns to convince austin voters fingerprinting was not necessary as part of the background check. The ad campaign failed, and they lost. But did they? Nope, they spent around 1M each on "lobbying" and got the lege to pass a law overriding austin's. https://www.vox.com/the-highli... [vox.com] I'm sure uber/lyft regret bothering with democracy. They could have saved 100M by going straight to the oligarchs.
    • by SpzToid ( 869795 ) on Sunday May 01, 2022 @10:00AM (#62494008)
      Seminole County, Florida was the first in The United States to mine bitcoin, under Joel Greenberg's direction. He started a fire doing it, (a power surge from the machines caused a fire, which resulted in $98,000 in damages [clickorlando.com]). It's a hilarious story.

      https://en.wikipedia.org/wiki/... [wikipedia.org]

      https://www.coindesk.com/marke... [coindesk.com]

      “If I get you $250k in Bitcoin would that help or is this not a financial matter,” Greenberg wrote to Stone [thedailybeast.com], one message shows. https://www.clickorlando.com/n... [clickorlando.com]
      • That whole thing is fractally stupid. Like, every time you zoom in, you get more stupid in different shapes.

        Seminole County, Florida was the first in The United States to mine bitcoin, under Joel Greenberg's direction.

        Does that count? From TFA:

        The goal? To mine cryptocurrency for Greenberg, not county tax payers.

        Also:

        He started a fire doing it, (a power surge from the machines caused a fire, which resulted in $98,000 in damages). It's a hilarious story.

        I'll now skip over the outer levels and just jump right

        • by SpzToid ( 869795 )
          No argument with the variable levels of stupidity or corruption, but The first US government region (we're talking counties vs. cities) to do it under authorized direction from the elected (county) official tax collector at the time was Seminole County, under authorized direction at that moment, never mind ulterior moments only to be discovered later.
        • by gweihir ( 88907 )

          That whole thing is fractally stupid. Like, every time you zoom in, you get more stupid in different shapes.

          Hmm. Interesting idea. It definitely fits here, but by far not only here.

          I'll now skip over the outer levels and just jump right in at: how the fuck does a power surge cause a fire. Surely if everything's wired up to code (lol lol lol) there are breakers such that the breakers pop before the cables get overloaded and anyway why aren't they fire retardant?

          I have seen some electrical "wiring" done by the stupid. If you work according to code, a lot of things have to go wrong in addition for a fire to start. If you ignore that code so save some money, that is not true anymore. There is a reason for that code and it is not generate business for electricians.

        • That whole thing is fractally stupid. Like, every time you zoom in, you get more stupid in different shapes.

          Well, there is a reason that Florida Man is a meme. And, along those lines, Texas ... 'nuff said.

      • Yeah but Florida's retardation is somewhat contained and limited. The problem is everything is bigger in Texas.

    • by Joce640k ( 829181 ) on Sunday May 01, 2022 @10:11AM (#62494048) Homepage

      what is the point of this ?

      Simple. People in a position of power can:
      a) Buy some Bitcoin
      b) Do something to say "Bitcoin will make you rich!"
      c) Sell Bitcoin from (a) after price rises due to (b)

      If Bitcoin doesn't rise then no biggie, the taxpayer is footing the bill. Move along to the next scam.

    • Why aren't cities doing more of this. They could sell lemonade, pump your gas, and produce movies. Anything is possible when you can spend from the city coffers and justify it that it might make a net profit.

      The main reason I pay taxes (other than the obvious one is that I'm forced to) is that I expect certain services from a government that can't practically be performed any other way. Zoning, building permits, and other high level decisions are the traditional scope of a local government. Running a bitcoi

  • All this is a political talking point to help push the governors power agenda.

    Hell, the miners they are using are Antminer S9s. Tech from 2015. Depending on the price of bitcoin they are most likely losing money most of the time.

    • All this is a political talking point to help push the governors power agenda.

      Hell, the miners they are using are Antminer S9s. Tech from 2015. Depending on the price of bitcoin they are most likely losing money most of the time.

      Based on the blurb, they should be squeaking by on "making" money:

      Each of the program's three machines will consume the same amount of energy as a household vacuum cleaner, according to city estimates. While the mayor doesn't expect the three miners to be major money makers, the cost of electricity needed for the program is expected to be offset by the value of bitcoin mined

      Of course what would really be nice is to know what timeframe for energy usage. When they say a vaccum cleaner, is that per hour, day, week, month, year?

      But the real irony in all of this is they were given the equipment for free, like in socialism:

      To make it happen, the city has teamed up with a few key partners, including the Texas Blockchain Council, which donated the three mining rigs (each valued at roughly $600 apiece), and Luxor Technologies, a mining pool, which lets a single miner combine its hashing power with thousands of other miners all over the world to increase their chances of earning bitcoin....

      In conclusion, getting your own money back from the government is evil socialism while getting something for free from someone else is, um, er, socialism?

      • But the real irony in all of this is they were given the equipment for free, like in socialism:

        The free software movement takes pains to point out that the English word "free" doesn't do a great job distinguishing between software which is provided at zero cost and software you can use and modify as you wish. Likewise, there is a big difference between what happened here, a private enterprise giving the equipment to the public by their own choice, and a socialist system which would take the equipment at the discretion of government officials.

        That said, the government is using money taken by taxation

        • the English word "free" doesn't do a great job distinguishing between software which is provided at zero cost and software you can use and modify as you wish.

          Such a distinction wasn't necessary until IP laws became a thing. Before that you could buy a thing and modify it, re-sell it, or even duplicate it as you wish. Once people started fighting over copies of books [wikipedia.org], our course was set and here we are some 14 centuries later still spending millions fighting over ownership of copies of things.

        • The free software movement takes pains to point out that the English word "free" doesn't do a great job distinguishing between software which is provided at zero cost and software you can use and modify as you wish. Likewise, there is a big difference between what happened here,

          The only difference between the two is that once comes with a legal contract. A product of big government and regulation, something else the cons claim to not like (except they actually love it for their own agendas).

      • Of course what would really be nice is to know what timeframe for energy usage. When they say a vaccum cleaner, is that per hour, day, week, month, year?

        Per second. As in the same number of coulomb per second. Of course if you ran a vacuum cleaner continuously for days it would probably overheat and fail. So nobody with a vacuum actually uses the equivalent amount of energy as one of these mining boxes.

        It's like saying something is no more powerful than a toaster. Well that's 1000 Watts.

      • At current rates, the S9 can generate about $2.50 worth of BTC per day at current rates.

        At an electricity price of 10 cents per KWh, it costs about $3 per day to run.

        The S9 is a 7-year-old money loser. The city is better off simply buying $3 worth of BTC every day than they are running the S9.

        • The flaw in the argument is that it assumes a fixed return. When bitcoin was at $100 is was also said that it couldnt be mined profitably by common GPU's anymore.

          Pretty sure the people that ignored the flawed argument made money, yeah? Possibly even selling for over $50000, not the $100 the claim was based on?

          You cant make arguments because, for fuck sakes, the "real value" is $0. It just doesnt fucking matter.
        • by guruevi ( 827432 )

          Nobody except California pays 10c for electricity in the US, especially not large buildings like a municipal datacenter, they probably aren’t even metered, but it should come to about 1-2c/kWh for that sort of connection, maybe double that for cooling (although you could recover that heat for water and other heating purposes).

      • Even if this involved a more sensible plan than using someone's antiques to obtain a rather volatile speculative asset on economically questionable terms; it seems like there should be some hard questions about why this is something a municipal government would or should be doing.

        Its normal for municipalities (whether in-house or by dictating the terms on which it's farmed out to contractors) to do things like handle local natural monopolies (roads, water and sewer, etc.) and money-losing public goods (s
  • by rantrantrant ( 4753443 ) on Sunday May 01, 2022 @09:57AM (#62493998)
    ...the US state famed for its rational, objective, science-based approach to legislation & policy-making.
  • ... which makes them perfect for government operations.
  • Translation (Score:5, Insightful)

    by dsgrntlxmply ( 610492 ) on Sunday May 01, 2022 @10:04AM (#62494016)
    Gullible smiling twit mayor duped by sketchy advocacy group and sketchy company headed by someone whose CV looks like Buckaroo Banzai, to waste public resources on advertising for a marginal and arguably harmful private venture. Unplug and toss the lot. There really is something neurotoxic in the water there: my great aunt in Fort Worth claimed to have conversations with her parakeets.
    • by ThomasBHardy ( 827616 ) on Sunday May 01, 2022 @10:25AM (#62494092)

      Of all the days to not have mod points.

      Someone references Buckaroo Banzai and I have no mod points to give.

      I'm not sure I'll ever recover from this.

    • Re: (Score:2, Interesting)

      But hey you can waddle to Chipotle with your AK47 because ‘MUERICA! Those same idiots would last 5 minutes in Ukraine.

    • He is guaranteed to succeed. To date everything needed has been donated. He will make ~$2400 a year in revenue. Since the boxes are not separately metered, the ~$3000 electric bill will be non-obvious. It will look like he is making money out of thin air for the city and so they will buy thousands of mining rigs next year, lease a warehouse, scale up and effectively start loosing hundreds of thousands of dollars a year. But they will only pay attention to and publish revenue numbers and this will be a
    • You should be nicer to your great aunt.

      While likely false, believing that you are in fact having a conversation with a bird known to be fairly intelligent and quite vocally sophisticated is arguably less delusional than this scheme; and it's an honest hobby without myriad opportunities for redirecting taxpayer money in ways that tack between 'abject stupidity', 'personal aggrandizement', and various flavors of corruption and self-dealing.
      • As a sometime windsurfer, I applaud the "tack between" imagery, especially given that "between" was often family swim area versus jetty full of profligately shitting birds.
  • While they might make a little money off of this, long-term this is going to be like bragging that they invested in this awesome mutual fund run by Bernie Madoff.
  • How dose a city playing with these gambling tokens that will continue to be volatile make them less of a risk for any other city to try?

    It doesn't. Fort Worth is run by morons riding hype trains. Speaking of trains, they need to be wary of monorail salesmen.

  • by gweihir ( 88907 ) on Sunday May 01, 2022 @10:25AM (#62494088)

    Certainly not. But for sure up there.

    • Certainly not. But for sure up there.

      Yep. At least she's hot. Google Mattie Parker.

      • by gweihir ( 88907 )

        And there we have the root cause (or part of it): Stupid woman gets voted into power because she is "hot"... Similar mechanisms exist for men though.

  • Of course (Score:5, Informative)

    by thegarbz ( 1787294 ) on Sunday May 01, 2022 @10:31AM (#62494110)

    If we were at a pub quiz and the question came up: "Which US State enacted a government policy that makes absolutely zero sense, provides no benefit to anyone, generates zero value, wastes a fuckton of electricity, and is incredibly detrimental to the environment?" I think everyone would answer Texas. You don't even need to guess it was bitcoin.

    It's like a free point in a pubquiz so that no one ends up getting 0/10

    • Honestly I'm 50/50 Texas or Florida. They're the only ones that have the infrastructure and the kleptocracy (kinda need both).

      It might be tough in Florida though, as the old folks and Disney wouldn't let the crypto bros crash their grid, and if you go south to the poor parts again, you probably don't have the infrastructure for reliable enough power. Texas' grid is just functional enough to be useful without there being anyone who can/will stop them from sucking down the power during blackouts and/or dr
  • Run your municipality and stop trying to be a commercial for profit enterprise.
  • by algaeman ( 600564 ) on Sunday May 01, 2022 @11:41AM (#62494242)
    Texas- Land of Externalized Costs
  • https://www.asicminervalue.com... [asicminervalue.com] So times 3 they are losing roughly 1500$ per year...
  • by swilver ( 617741 ) on Sunday May 01, 2022 @11:47AM (#62494264)

    ...to pay the ransom when they inevitably get hacked.

  • They can't keep the grid up , people go without heating and lights all the time and now they want to use the few resources they have to mine bitcoins ? They totally lost the few braincells they had left.

  • by robi5 ( 1261542 ) on Sunday May 01, 2022 @06:24PM (#62495062)

    > the cost of electricity needed for the program is expected to be offset by the value of bitcoin mined

    And who gives a fuck about the fact that irrespective of possibly eking out a profit, it also contributes to emissions, either by running on fossil energy, or by running on renewables which instead could be used to displace fossil sources.

  • If they are running them inside, at the end of the day it's a colassal waste of energy and CO2. Forget about taking cards of the road, shut down the Bitcoin miners

  • ...to bitcoin worth!
  • Does it mean that the crypto there will become an official way of payment or something like that? I think it's rational for people to mine crypto and profit from that. I wouldn't be surprised if someone from the government reads an article like https://4irelabs.com/articles/... [4irelabs.com] and decide to come up with his own NFT marketplace since it's pretty profitable as well, but in general, it's just weird that government does something like that.

"If value corrupts then absolute value corrupts absolutely."

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