Bitcoin mining company Riot was paid $31.7 million by Texas to shut down its operations during a heat wave in August. This strategy shift aims to help mitigate the strain on the power grid. The credits earned through this program significantly lower Riot’s mining costs and contribute to making Riot one of the lowest-cost bitcoin producers. The company has experienced financial losses due to the crypto market reversal, with a net loss of over $500 million in 2022. However, Bitcoin’s recovery in 2023 has boosted Riot’s stock. The use of alternative sources of income, such as the energy grid curtailment program, helps offset the impact of fluctuating energy prices. Texas grid operator ERCOT strikes deals with bitcoin miners to balance power supply and keep prices stable. The economic equation involves compensating miners for the potential loss of mining revenue during curtailment. Moreover, the inclusion of bitcoin miners in the ERCOT grid acts as a hedge against disaster and provides stability.
AI Sentiment: Neutral
