On a sweltering July day, an unlikely group arrived at a shooting range in central Texas. There was Kevin Pan, CEO of the Chinese cryptocurrency mining company Poolin, and his two vice presidents, Qian Xiong and Alejandro De La Torre. It was just one stop on a sprawling, statewide tour that spanned industrial power plants, trying on sleek cowboy hats with oil prospectors, and learning how to handle AR-15 rifles.

The atmosphere was easy with their “American cowboy friends,” De La Torre told Rest of World. “Everyone here is a capitalist, and everyone wants Bitcoin to succeed,” De La Torre said. “Everyone wants to make money.”

Despite their optimism, Poolin’s executive team has been on the move, restless, for nearly three months. The Hong Kong–headquartered company is one of the world’s largest Bitcoin mining pools, groups that combine resources to mine cryptocurrency more effectively. Poolin holds the second-largest share of the global Bitcoin hashrate — a measure of the computing power it takes to mine new Bitcoin — with a network of operations across Berlin, Beijing, Chengdu, Changsha, and Singapore.

They were thrown into chaos in May, when China’s State Council banned cryptocurrency mining and trading in the country. “We were, the next day, on a flight out,” De La Torre said. “I was flying out of Germany, and my colleagues were flying out of China.” His tone was pragmatic. “Okay, I’ve got more work [to do]. That’s it.”

Up to that point, China had been a center of gravity for Bitcoin mining. Home to massive facilities that housed more than 70% of the world’s mining power, it also headquartered companies like Bitmain and Whatsminer, manufacturers of mining machines. Because Bitcoin is created by solving algorithmic “blocks” of increasing difficulty, thousands of miners harnessed their computing power in pools — the largest of which, Poolin among them, were also formed in China.

In the weeks after the ban, all scrambled to move their hardware to friendlier jurisdictions. Some crossed the border to Kazakhstan; others pitched up as far afield as Norway.

Poolin’s team went to Texas. The cowboy hats, target practice, and barbecue brisket were just a bonus. They were really there for the deregulated electrical grid.

Ousted from the provinces where they’d spent years building a footprint, China’s fleeing Bitcoin miners are now looking for stability. They want plentiful, cheap electricity to power their tens of thousands of computers — but they also want the certainty that politics won’t interfere with their operations. Before they can begin displacing the global financial system with a decentralized, peer-to-peer system of exchange, their needs are suddenly much more prosaic: predictable regulation, stable relations with governments, and affordable power.

It’s harder than it sounds. Despite the desperation of miners to find a home and the eagerness of places like Texas to house them, months after the ban, Poolin and other big Chinese miners have tested the waters in the state, but found barriers to settling.

“The crackdown was all of a sudden, and we were not prepared,” De La Torre reflected. “We don’t want instability anymore. … We are looking for something stable in the United States. The government is not going to come and close your company, like they do in China.”

Mining Bitcoin resembles an infinite arms race. In the early 2010s, miners were using off-the-shelf computers equipped with advanced graphics cards; by late 2013, there were roughly two dozen companies in China making specially-designed chips called ASICs. In Inner Mongolia, mining facilities were soon stacked with tens of thousands of them. And while activity flourished in a legal gray area, officials would, every so often, condemn miners for their intensive energy usage, saying it clashed with government climate change initiatives.

The early months of 2021 saw Bitcoin’s value seesaw, and as volatility became a concern to Chinese authorities, they acted quickly. On May 21, the State Council announced a ban on crypto mining and trading, to prevent, they said, “the transmission of individual risks to the social field” — a sign of their anxiety over mounting investment in ever-more speculative coins. First to shutter were massive coal-fueled operations in Xinjiang and Inner Mongolia, then the hydro-powered mining farms along rushing rivers in Yunnan and Sichuan.

But even before the ban came down, mining pools with operations abroad — Poolin among them — were on the lookout for more cheap, overseas power. In April last year, China was home to around 65% of the world’s Bitcoin mining output. By the time of the crackdown just over a year later, it was down to 46%.

Chinese miners whose computers haven’t already been padlocked by local authorities have packed them onto planes. Some, like Bitmain, have gone to Kazakhstan, whose geographic proximity, permissive regulations, and cheap coal make it attractive. But Bloomberg data suggests the country has added just 3 gigawatts of power capacity in the past two decades, leaving little room for miners to scale.

Shuyao Kong, an analyst at blockchain software company ConsenSys, said that the future of Bitcoin mining inside China is now in crisis. Some small- and medium-sized mining operations are waiting it out, said Kong, in case they can find ad hoc ways around the ban: a friendly provincial official willing to allow a few computers near a hydropower dam here, a power plant with extra floor space there.

But the large miners that operate massive facilities with thousands of machines will have to leave for good. They are just too big. Their businesses will be dispersed, said Kong, and while it means they’re insured from any future crackdown by a single government, they’ve lost a rare connection between mainland China and global markets.

“Fundamentally, Bitcoin is in a different paradigm from the Chinese political structure,” said Kong, who also writes about cryptocurrency in China under the handle da bing, or “big pancake.” “Right now, [China’s government] cracks down on anything that it doesn’t have control over. Bitcoin is one of those things that it doesn’t control.”

In places like Texas, though, Poolin and its rivals are seeking something even more elusive than cheap power: legitimacy.

Here, they are not being evicted, but courted. In June, Texas Governor Greg Abbott made a virtual appearance at a crypto conference in Chengdu, where he tried to convince miners to relocate to his state. State Representative Tan Parker authored a recent bill to allow banks in the state to hold cryptocurrency. Miners with cash and the ability to commit are in talks with officials about building new facilities near power plants in the far-flung corners of Texas’ deregulated grid and in other states, like Wyoming and Nebraska.

In the municipal development district office of Rockdale, Texas, a 5,500-person town about an hour outside Austin, the phone has been ringing off the hook. Every caller has been looking for the same thing: access to the affordable, stable power that, before 2008, made the town a center for aluminum maker Alcoa and, since 2020, made it a center for Bitcoin mining.

Jim Gibson, the executive director of Rockdale’s Municipal Development District, which is responsible for recruiting new business to the old Alcoa site, was tallying up six different entities that have approached him in the last week about building Bitcoin mining facilities in Rockdale, when he was interrupted by the phone ringing again.

“Those guys want 200 megawatts just to start up,” he told Rest of World after hanging up. “To put that in context, 400 megawatts is like downtown Dallas.”

Gibson was preoccupied with numbers. Ten thousand: how many of the brand-new, top-of-the-line S19 Antminer computers one of the callers was looking to move into town. One hundred million dollars: how much another was ready to spend on a new mining facility. Nine: how many days Gibson had been on the job.

The town mayor, 78-year-old John King, said it could take the town up to six months to get 30 megawatts available for new companies. The two men estimated they could get at least another 150 megawatts up and running on a parcel of land outside of town that’s in the process of being annexed. “We’re going to need a Chinese interpreter,” King joked.

Rockdale has seen this kind of interest before. In 2018, China's Bitmain pledged to invest $500 million to build a mining facility on the vacant Alcoa property, which was still connected to mammoth power lines. The company was negotiating to pay between 3 and 4 cents a kilowatt-hour for electricity — among the lowest prices anywhere in the country.

But when the price of Bitcoin plummeted in late 2018, progress on the facility slowed, and Bitmain downgraded the project. Today, the site is occupied by BitDeer, a Bitmain spin-off that was formerly a subsidiary.

A story about its demise in Wired magazine caught the eye of American crypto miner Chad Harris; that led to his company, Whinstone, setting up the largest Bitcoin mining farm in North America directly across the street. Both companies' operations are growing. When Whinstone’s expansion is finished, it is expected to require 750 megawatts of power, enough for over 150,000 Texas homes at peak demand.

The old Alcoa plant quietly hulks on the edge of a small pond about six miles from Rockdale’s Main Street, at the end of a dusty road. Bullet-hole-ridden signs warn visitors they’re on company property. Electricity hums along the thick tubes that cross the road from the power plant to the substation. Meadowlarks zip between the power lines. Inside the Whinstone buildings, the temperature can push 150 degrees Fahrenheit, with solid walls of computers cooled by a column of oven-temperature air.

Bitcoin mining is decentralized, which means that Rockdale isn’t just competing with other small towns in Texas to attract the business of the miners, but against any location in the world that can offer an optimal combination of affordable power, available infrastructure (or cheap labor to build more), and favorable regulations. The miners calling Gibson are also contacting his counterparts in Almaty, Saskatchewan, Wyoming, and Norway.

Despite political support and energy prices that rank among the cheapest in the world, Texas is not without risks. A series of controversial (and ultimately forgone) proposals included in the Biden administration’s infrastructure bill would have required miners to report transactions, as brokerages do. The state’s energy grid notoriously failed for days during intense winter weather in February, and at peaks when summer ACs are cranking, demand can approach 70 gigawatts — more than three times the 22-gigawatt capacity of Kazakhstan’s entire grid.

During these peaks, the state’s electricity operator, ERCOT, not only notifies Bitcoin miners to turn off their machines — it pays them to do so, offering them the opportunity to take in a sizable amount of cash when energy prices are high. But detractors point out that these facilities are diverting an enormous amount of energy from an already strained grid, and toward something that not everyone agrees has value.

“Right now, [China’s government] cracks down on anything that it doesn’t have control over. Bitcoin is one of those things it doesn't control.”

In Texas, foreign companies from places like China need local partners for power-generating projects. “Every large Chinese miner has either called us or been through here,” said Chad Harris, CEO of Whinstone, who operates the company with his two sons and recently sold it to U.S. miner Riot Blockchain.

“The difference is that we also have U.S. organizations who are also trying to accomplish the same things here,” said Harris. They haven’t finalized any new deals yet.

Poolin is one among several large mining companies scouting locations across the state for new facilities, pitting them against each other for the best deal. “They realize that we are serious players; they understand what we are trying to do,” De La Torre told Rest of World. The company is still weighing up its options there, he added.

Many miners are still in a holding pattern. Rest of World spoke with a number of analysts and representatives who have worked with three of the largest China-based mining pools, but as of the end of July could not confirm any completed deals, more than two months after the ban.

Lynn Cheng, an entrepreneur who has been contacting potential sites in Texas on behalf of Chinese miners, said that in several cases, the proposed deal structures have been confusing to her clients.

Many of them are long-term, multiyear arrangements. One Texas mining farm agreed to host machines coming out of China only if it could share in the profits. For Cheng’s clients, it’s more common for a landlord to charge miners for the electricity consumed, rather than ask for a share of the Bitcoin they create. “This is not something we are used to in China,” said Cheng.

Over barbecue after a recent Bitcoin developers’ meetup in Austin, Texas, the attendees were nothing but exultant about the results of the crackdown in China. They discussed the resilience of Bitcoin; how it prevailed against the world’s second-largest economy; and celebrated that the initial FUD (an acronym for fear, uncertainty, and doubt) that they worried might spread had settled down. “The network is working as intended” was a common refrain. In attendance, wearing a cowboy hat, was Jimmy Song, co-author of the Christianity-infused crypto manifesto Thank God for Bitcoin.

For Bitcoin evangelists, Beijing’s crackdown has only strengthened their project, spinning it out to become ever more decentralized, said a software engineer who asked to only be known as JJ. A self-described HODLer (someone who believes that selling their Bitcoin would betray its potential future growth), JJ said that China’s crackdown prompted him to buy mining machines in a pool operated by mining finance company Compass — first two, then 20.

JJ paused. He wondered what would happen if the U.S. government were to make a similar move. “I think the larger question is, if it’s the kind of country where it’s going to shut down freedom of expression, what does that say about the country? I’d think less about the loss of my livelihood and more about the loss of fundamental freedoms.”

Everything in Bitcoin boils down to trust, the gathered developers agreed. Proponents are drawn to cryptocurrencies because they don’t trust what’s happening with the dollar — because look at what happened to Argentina’s currency, and because how can you really know someone behind a digital transaction is the person they say they are?

Still, miners need some way to guarantee that the basic mechanics of the existing financial and political system function as intended. They need to be able to trust that Texas will remain a business-friendly state and that they can continue to pay for power from the grid. Their alternative is to pack up all over again, and keep running.

Buck Perley, an engineer at Bitcoin financial services company Unchained Capital, previously spent nearly a decade in China. In 2013, he and his wife broke the Guinness World Record for the longest motorcycle trip in a single country when they rode through every Chinese province. Perley said that mining had always been at the heart of Bitcoin in China. “If you don’t know when the government is going to come after you, you have to make as much money as quickly as possible,” he remarked to Rest of World.

“It’s quite funny, because a lot of Bitcoiners view themselves as above politics,” said Perley. “But Bitcoiners, like everybody else, are nervous to admit that there might be the same types of flaws in the thing that they hold dear. We have all these flaws, but it’s because humans are involved.”