In a recent statement, Brian Morgenstern, Head of Public Policy at Riot Platforms Inc., the second-largest Bitcoin miner in the United States, has strongly criticized the US Energy Information Administration’s (EIA) new directive to gather data on energy consumption by Bitcoin miners. Morgenstern alleges that this move is driven by political motives and not genuine environmental concerns.
EIA’s energy data directive is suspected as a political attack on Bitcoin.
Morgenstern’s comments imply that the EIA’s directive is not primarily aimed at addressing environmental issues but rather appears to be a politically motivated attack on the Bitcoin and cryptocurrency industry.
He suggests that the directive is indirectly influenced by recommendations from the White House Office of Science and Technology Policy and a group of Senators, notably including Senator Warren, who has been vocal in her criticism of the crypto sector.
The official document supporting this argument states, “Concerning EIA, both the White House Office of Science and Technology Policy and a group of Senators, led by Senator Warren, have recommended that EIA collect energy-relevant data on US crypto mining activity.”
Debunking Environmental Misconceptions
Morgenstern also aims to correct a common misconception about Bitcoin mining, asserting that Bitcoin miners do not directly emit carbon but are rather electricity consumers, much like electric vehicles.
This distinction is crucial to separate electricity consumption from direct carbon emissions, which is often blurred in public discourse.
He states, “There’s no emergency, and this has nothing to do with transparency. Bitcoin miners are one of the most transparent industries in the world. The data shows miners enhance grid stability and have a negative correlation with grid stress.”
Transparency in the mining industry
Morgenstern emphasizes the transparency within the Bitcoin mining industry, refuting the EIA’s implication of opacity. He claims that the industry not only operates transparently but also contributes positively to power grid stability, countering the EIA’s assertion that crypto mining poses a risk to grid stability.
A significant part of Morgenstern’s criticism revolves around the perceived invasion of privacy and the disclosure of sensitive business information. He argues that the directive exposes private business data to groups with an anti-crypto mining agenda, potentially facilitating targeted attacks.
Government bias and regulatory agenda
Morgenstern extends his critique to the broader policies of the Biden administration regarding Bitcoin. He suggests that the government exhibits a bias favoring a Central Bank Digital Currency (CBDC), which could be linked to a desire for greater control over financial transactions. He contends that this bias is indicative of a broader inclination within the government to regulate and possibly suppress the Bitcoin and cryptocurrency sector.
He cites a White House proposal from September 2022, which expressed a desire to “limit or eliminate” Bitcoin mining using high-energy intensity consensus mechanisms for crypto-asset mining.
Legal and constitutional concerns
Morgenstern raises legal and constitutional concerns regarding the EIA’s directive, suggesting that it may violate several legal principles. He highlights potential violations of administrative procedure, the Paperwork Reduction Act, compelled speech (in violation of the 1st Amendment), due process, and the major questions doctrine.
Furthermore, Morgenstern connects these potential violations to broader actions by the Biden administration, including the SEC’s approach to crypto regulation, which he characterizes as “regulation by enforcement.”
Morgenstern concludes by mentioning the White House’s proposal for a thirty percent tax on electricity used by specific users while simultaneously advocating for increased access to electricity for all Americans. He expresses bewilderment over this apparent contradiction.
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