On March 31, 2025, US Senator Ted Cruz (Republican, Texas) introduced the FLARE Act, aimed at converting emissions from flaring activities into electricity for Bitcoin mining. With the goal of making Texas the world's number one Bitcoin mining hub, can this legislation truly revolutionize the crypto industry, or is it just a political stunt?
The FLARE Act: Harnessing Emissions for Bitcoin Mining
The Facilitate Lower Atmospheric Released Emissions Act was submitted by Ted Cruz on March 31, 2025, focusing on reusing emissions from flaring or venting activities – often wasted in the oil and gas industry. The bill encourages companies to collect this gas by allowing full expensing of the costs associated with collecting and converting gas into electricity.
Cruz emphasizes that Bitcoin mining is a direct application of this surplus energy. In a statement, he declared: 'The FLARE Act harnesses Texas's enormous energy potential, solidifying the state’s position as a Bitcoin industry hub, while being good for the environment.' He is committed to: 'I want to make Texas the number one place for Bitcoin mining, encouraging entrepreneurs and miners to utilize wasted natural gas.'
The bill amends the 1986 Tax Code, allowing permanent deductions for emissions collection equipment, while using this gas to create 'value-added products' such as electricity. This not only enhances grid stability but also generates 'other useful products,' such as supporting Bitcoin mining – an energy-intensive industry (with global consumption of 160 TWh/year, according to the Cambridge Bitcoin Electricity Consumption Index).
Texas: The 'Capital' of Bitcoin Mining?
Texas has long been the center of Bitcoin mining in the US, thanks to abundant energy resources and low costs. The state accounts for 23% of global mining (Q1/2025, according to Foundry USA), with major companies like Riot Platforms (12,374 BTC) and MARA Holdings (46,374 BTC) based here. However, the mining industry is facing a crisis: 14 publicly traded companies lost 12 billion USD in market capitalization in Q1/2025 (according to JP Morgan), due to a 12% drop in Bitcoin prices (84,900 USD) and increased mining difficulty.
The FLARE Act could be a 'lifeline' for the mining industry in Texas, leveraging 1.6 billion cubic feet of gas flared every day (according to the World Bank). If successful, the bill will reduce energy costs – which account for 80% of mining costs (according to Bitmain) – and help Texas strengthen its position against competitors like Kazakhstan (13% hashrate) and Russia (5%).
The bill also prohibits competing countries like China, Iran, North Korea, and Russia from participating in the program, reflecting America's strategy to control the Bitcoin mining industry. This aligns with President Trump's commitment during his re-election campaign: 'Ensure that all remaining Bitcoin is mined in the US.'
Environmental and Economic Benefits
Hailey Miller, Director of Government Relations at Digital Power Network, supports the FLARE Act, stating: 'Bitcoin miners are uniquely positioned to reduce emissions by harnessing wasted energy sources.' She emphasizes that the legislation 'ensures American energy producers have the tools to deploy advanced solutions, making the energy market more efficient and sustainable.'
Mining Bitcoin from emissions not only reduces methane emissions (which account for 16% of global emissions, according to the report) but also creates new electricity sources, enhancing the stability of Texas's power grid – which is often overloaded (2021 blackout incident). According to the EIA, if 50% of the flared gas in Texas is reused, the state could generate an additional 2,500 MW of electricity – enough to power 500,000 households.
Impact on the Crypto Market
Bitcoin (~84,900 USD): The FLARE Act could increase hashrate in the US, supporting long-term prices, but the market is still down 12% in Q1/2025 (Trump tariffs, pessimistic sentiment).
Mining industry: Companies in Texas such as Riot and MARA could benefit, reducing energy costs (currently 0.04 USD/kWh in Texas, lower than the national average of 0.08 USD/kWh).
Crypto market: Market capitalization decreased by 11.65% (2.88 trillion USD), but the FLARE Act could inspire other states (Kentucky, Oklahoma have supported mining).
Conclusion: Texas – 'The Capital' of Mining or a Political Stunt?
Ted Cruz's FLARE Act is a bold step, turning emissions into electricity for Bitcoin mining, while bringing Texas closer to its goal of becoming the global mining capital. The bill not only offers economic and environmental benefits but also strengthens America's strategy in the crypto sector. However, with the volatile market (Bitcoin down 12%, Trump tariffs as of April 2) and pressure from international competitors, will Texas truly become 'number one'? As the FLARE Act is considered, the future of the mining industry in the US will soon be revealed.
Risk warning: Crypto investment carries high risks due to price volatility and regulatory uncertainty. Please consider carefully before participating.