Maybe we needn’t be so concerned about that mysterious “data center” — widely thought to be a cryptocurrency mining facility — slated for the Morgantown Industrial Park after all.
Because for the last month and half, cryptocurrency has been in freefall.
It started back in May when a type of stablecoin collapsed. Stablecoins are cryptocurrencies that are anchored to real-world assets and/or are supposed to keep a dollar-to-dollar exchange (one crypto unit equals one U.S. dollar). terraUSD was an experimental stablecoin that relied on an algorithm, but the algorithm failed and the currency collapsed, tanking in value to $0 and taking its sister cryptocurrency, Luna, with it.
This in turn set off a chain reaction that has decimated the value even of well-established currencies like Bitcoin, which, as of this writing, had dropped to less than $19,500 per coin from a high of almost $69,000 per coin in the last year.
The crypto downturn has had real-world effects, too. Burgeoning crypto companies started mass layoffs and rescinded job offers, and some even froze withdrawals as they started to run in the red. Investors — especially those who didn’t get in early and/or had only invested a few thousand — have lost half or more of their investments. And one company actually had to close a data mining facility because it cost more to keep it running than the cryptocurrency it generated was worth. As we’ve talked about before, crypto mining operations require tons of energy to not only power the many computers solving equations, but also to keep them cool.
It’s that last bit that makes us wonder if the crypto mining facility eyeing the MIP might just change its mind.
That said, many crypto-bros who got in on the ground floor aren’t too concerned. Some are even excited to see the currency hit a bear market, because it’s kicking the less reliable cryptocurrencies out of the game. According to a recent CNBC article, there are around 19,000 cryptocurrencies and dozens of blockchain platforms. (Blockchain is the underlying mathematical equations and puzzles that give cryptocurrencies their value. Crypto mining facilities solve blockchain equations to unlock new coins and register them to a ledger so they can’t be double spent.) Multiple sources liken the current crypto crash to the dot com crash of the late 1990s: The “weak” companies and the scammers will be weeded out and the “strong” will go on to become the Amazons and eBays of tomorrow.
Even if crypto bounces back — as it probably will, if not in a few months then at least in a few years — we still hope the volatility of today’s market is enough to deter any company from building a crypto “data center” here.
