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Biden Administration's Bitcoin Mining Survey Paused Amid Legal Challenges

Lawmakers backpedal on Bitcoin mining probe after public uproar

The Biden administration's initiative to scrutinize Bitcoin mining practices has been temporarily halted. This decision comes in the wake of significant legal pushback from key industry stakeholders, including Riot Platforms and the Texas Blockchain Council. The U.S. Energy Information Administration (EIA), facing lawsuits, has consented to cease its emergency survey of Bitcoin mining operations. 

As part of a legal settlement, the EIA is committed to erasing all previously collected data. This legal standoff spotlighted the contentious nature of the survey, which sought detailed insights into the energy consumption of cryptocurrency mining activities. Critics argued that such disclosure requirements would unjustly compromise operational confidentiality and integrity, leading to "irreparable harm."

Settlement terms and future steps

The EIA will initiate a fresh start by announcing a new Federal Register notice, effectively resetting the Bitcoin mining survey process. This adjustment allows for a comprehensive 60-day commentary period, inviting industry feedback and ensuring transparency. The agreement mandates the destruction of all collected data to date, underscoring a commitment to confidentiality until such data is permanently disposed of. 

Moreover, the EIA is tasked with considering responses to both the forthcoming notice and its February 9 precursor as equally significant. This settlement not only addresses immediate legal concerns but also sets a precedent for future governmental inquiries into the cryptocurrency sector. The resolution includes a nominal reimbursement, with the EIA compensating Riot Platforms and the Texas Blockchain Council $2,199.45 for legal expenses, marking a conciliatory end to the dispute.

Controversy and industry response

The initiation of the EIA's survey in late January, under the Biden administration's directive, sparked widespread controversy. Aimed at assessing the energy footprint of Bitcoin mining, the survey aligned with broader energy concerns highlighted in the 2022 Inflation Reduction Act. However, industry backlash was swift, with significant players like Riot Platforms and the Texas Blockchain Council challenging the survey's premise. 

They argued it threatened operational secrecy and could unjustly penalize the sector. The controversy reached Capitol Hill, where Republican Congressman Tom Emmer criticized the survey's emergency justification as lacking essential public discourse. The industry's united stand against perceived overreach resulted in a temporary court injunction, pausing data collection efforts and setting a precedent for regulatory engagement with the crypto mining industry.