Nationalizing Bitcoin Mining? US Senators Propose Innovative Reserve-Backed Bill

In an effort to bolster American manufacturing in the Bitcoin mining sector, U.S. Senators Bill Cassidy and Cynthia Lummis have introduced the Mined in America Act. This bill aims to reduce reliance on foreign technology by promoting the production of mining equipment within the United States and establishing a Strategic Bitcoin Reserve.

Key Takeaways

Approximately 97% of Bitcoin mining hardware originates from China, posing potential security risks and supply chain issues for the U.S.
The Mined in America Act would establish a "Mined in America" certification to promote U.S.-made mining equipment.
The legislation also proposes creating a national reserve of Bitcoin, ideally sourced from American facilities, linking national security with local mining operations.
The bill is intended to position Bitcoin mining as a significant part of American industrial policy.

Bitcoin

Addressing the Mining Supply Chain

A significant issue facing the Bitcoin mining industry is its dependence on foreign technology, particularly from companies in China. To alleviate this concern, Senators Cassidy and Lummis have proposed a law that would foster the domestic manufacture of specialized mining chips and rigs. The Mined in America Act seeks to create a certification for data centers, ensuring that they do not utilize equipment made by foreign adversaries.

This move would drastically change the current landscape, as most miners are accustomed to purchasing hardware from prominent Chinese manufacturers such as Bitmain and MicroBT. Under the new regulations, these companies would need to transition to U.S.-made equipment, a bold strategy aimed at fostering a homegrown industry.

"Digital asset mining is a significant part of our economy. We should be doing it here in America. I’m proud to introduce the Mined in America Act with @SenLummis, which aims to secure supply chains, bolster U.S. manufacturing, and support this vital industry." — U.S. Senator Bill Cassidy, M.D.

Federal agencies will play a crucial role in this transition, particularly the National Institute of Standards and Technology, which will assist U.S. manufacturers in creating more efficient chips for mining. This initiative is aimed at ensuring that the United States not only retains mining power but also develops the technology necessary for it. By producing hardware domestically, the industry would circumvent shipping delays and customs issues that have hindered growth over recent years.

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Linking Mining with National Reserves

The legislation is not solely focused on hardware but also aims to establish a plan for a Strategic Bitcoin Reserve. Former President Donald Trump has previously shown support for the government maintaining a reserve of Bitcoin, and the Mined in America Act seeks to codify this vision into law. It proposes that Bitcoin stored in this reserve should primarily come from certified "Mined in America" facilities, tying national security directly to the operations of mining facilities throughout the country.

Currently, the U.S. is responsible for about 38% of the global Bitcoin hashrate, indicating a strong presence in mining operations but a lag in domestic manufacturing capabilities. The proposed bill would utilize the Manufacturing Extension Partnership to equip small and medium-sized American factories with the resources needed to stay competitive in this industry. The ultimate objective is to make Bitcoin mining an integral aspect of American industrial policy, transforming it from a niche financial activity into a major economic contributor.

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