YEREVAN (CoinChapter.com) — President Joe Biden has ordered a Chinese-owned cryptocurrency mine in Wyoming to shut down and sell its property. The facility, located just a mile from the F.E. Warren Air Force Base in Cheyenne, was deemed a national security risk. This decision came after an investigation by the Committee on Foreign Investment in the United States (CFIUS).
The investigation by CFIUS found that the crypto mine could be used for spying because it is close to a missile base and a Microsoft data center that supports the Pentagon. Microsoft had warned that the mine might allow for extensive intelligence gathering.
Map showing the proximity of the MinerOne site, the Francis E. Warren Air Force Base, and the Microsoft data center. Source: Google MapsImmediate Cease Operations and Divestment Order
Effective immediately, the cryptomining facility must cease operations. The owners have 90 days to remove all equipment and 120 days to sell or transfer the property. The executive order highlighted concerns about the foreign-sourced mining equipment, mostly manufactured by Chinese companies, used in the operation.
Cryptomining facilities like this one are housed in large warehouses with specialized computers that run continuously, consuming massive amounts of electricity. At full capacity, the Cheyenne Mine would use as much power as 55,000 homes.
Growing Scrutiny of Chinese Investments
Since China banned crypto mining in 2021, many Chinese-owned cryptocurrency mines have moved to the United States. The U.S. offers cheaper electricity and a well-developed legal system. However, these operations have raised security concerns, especially near sensitive locations. The New York Times found Chinese-owned or operated Bitcoin mines in at least 12 states, consuming as much power as 1.5 million homes collectively.
President Biden’s recent actions reflect increased scrutiny of Chinese investments in the U.S. The order follows a bipartisan bill banning TikTok unless its Chinese owner sells it. Additionally, Arkansas has passed laws restricting foreign ownership of crypto mining operations, targeting nations like China, Iran, and Cuba.
Legal and Regulatory Backdrop
MineOne Partners Limited, the company behind the Wyoming mine, must comply with Biden’s order. A lawsuit revealed that its ownership included Chinese nationals, with Bit Origin Ltd., a former Chinese pork producer, becoming a partner in 2022 and beginning operations in early 2023.
Presidential Order on MineOne Partners and CFIUS NotificationSource: Regulation Asia
Despite attempts to contact Li Jiaming, the president of Bit Origin Ltd., there was no immediate comment. Li had previously stated that the site was chosen for its electricity contract, not its proximity to the Air Force base or data center.
Implications for the Crypto Mining Industry
This shutdown order is the second recent move against Chinese-owned crypto mining operations in the U.S. Arkansas has seen a surge in Bitcoin mining, leading to new laws aimed at curbing foreign influence. Residents near these mines have complained about the constant noise and its impact on property values.
The new Arkansas law requires foreign-owned crypto miners to divest within a year, addressing security concerns and resident complaints. The Wyoming shutdown adds to the growing pressure on Chinese investments in the U.S. and highlights the ongoing geopolitical tensions between the two nations.
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