This spring, Mayor Mattie Parker breathlessly tweeted in fluent crypto boosterism, “We’re making Fort Worth the first city government in the United States to mine bitcoin. We launch at 2:30 p.m. CT today, livestreamed here on Twitter.”
Since that giddy April day, when Fort Worth burst into the bitcoin mining world, the cryptocurrency has taken a nosedive. CNBC says, “bitcoin has lost around 58% of its value in the second quarter of 2022.”
This is no small thing. Based on reporting by Forbes, “approximately 107 [million] Americans invested in crypto for the first time in the last two years,” so during a time of economic uncertainty, bitcoin, which has advertised itself as a hedge against inflation, has proven to be a terrible investment for millions of our family members, friends, and neighbors. But they’re all suckers who deserve what they get when they invest in what Nobel Prize-winning economist Paul Krugman has described as a “postmodern pyramid scheme,” right?
Perhaps, but as citizens of this city, we are, whether we like it or not, involved because Fort Worth, in its excitement to burnish its lackluster credentials as a high-tech entrepreneur hub and appeal to the libertarian-leaning technogentsia, prematurely lent Fort Worth’s good name to bitcoin and by extension other cryptocurrencies, giving them some veneer of “respectability.” While I’m sure Fort Worth hasn’t helped bitcoin as much as Matt Damon’s embarrassingly pretentious “Fortune Favors the Brave” commercial, we should still all be concerned about lending our city’s name to something that can potentially tarnish it.
And bitcoin, as it exists now, certainly has that ability. In July, Lael Brainard, the vice chair of the federal reserve, delivered a speech in which she enumerated the problems involved with cryptocurrencies: “Risks include runs, fire sales, deleveraging, interconnectedness, and contagion, along with fraud, manipulation, and evasion.” As Krugman summarized it, Brainard was pointing out that traditional banking is “regulated for a reason; crypto, in bypassing these regulations … has created an environment subject to bank runs, not to mention ‘theft, hacks, and ransom attacks’ — plus ‘money laundering and financing of terrorism.’ ”
So should the City of Fort Worth and, by extension, all of us who live here have anything to do with any of the above? Clearly, no, we should not.
And while involvement with financing terrorism and money laundering is certainly bad enough, should we, during a time of high energy usage because of spiking temperatures this summer putting strains on our already problematic electrical grid, be involved in bitcoin mining, which wastes enormous amounts of energy solving very complicated computational math problems to produce the currency? As the Center on Global Energy Policy has said, “ERCOT estimates that crypto miners may increase energy demand by up to 6 gigawatts by mid-2023, roughly the equivalent of adding another Houston to the grid.”
While Fort Worth’s one crypto-mining machine will not by itself cause the grid to collapse, normalizing and sanctioning crypto mining, as Fort Worth is doing, does add more pressure on our already strained grid. And that is just bad public policy.
Of course, Parker is not the only head of a major city to go gaga over cryptocurrencies. The mayors of New York City and Miami have done likewise. For what purpose? As Fort Worth City Councilman Leonard Firestone related to the Fort Worth Business Press recently, Fort Worth being the first city to mine bitcoin “communicates to people that we’re a very progressive city with a young mayor, a young council. We’re embracing technology and recruiting technology.”
So for reasons that are largely symbolic — to say in 2022 that you are for high-tech business — Fort Worth has championed an unregulated, incredibly complicated, and volatile technology that uses an enormous amount of energy, lending the city’s good name to a potentially dangerous economic innovation that has lost investors trillions of dollars this past year. As quickly as possible, Fort Worth should say no thank you to continued bitcoin mining. To persist in lending its good name to an unregulated cryptocurrency is not being modern or cutting edge. It’s being flagrantly irresponsible. — Ken Wheatcroft-Pardue
This column reflects the opinions of the author and not the Fort Worth Weekly. To submit a column, please email Editor Anthony Mariani at Anthony@FWWeekly.com. Columns will be gently edited for factuality, clarity, and concision.
This is unbelievable, I was on the phone to my Texas transplant brother in Wyoming, our new mayor, with no experience, had asked the voters to give her a $40 or 50$ k raise about 4 months into her term! And then I pickup a paper with this type of endorsement for a proven scam when she should be posing by a filled pothole or something to do with keeping this place up.
I CAME from Dallas 20 years ago because I loved the laid back but free attitude of the cultured cowboys/cowgirls over here. My parents brought us over here monthly for museum visits. I and many others don’t want to be the new Houston or Dallas. Let’s be what the place is known for and not worry about trying to drag in all the dirty money there is and build apartments upon every corner. But my comment to Mattie is that this looks very bad for especially since your quest for a quick raise I hope didn’t work. We who didn’t vote for you just want to say “you are not Betsy” so you must really get down to work with our City Mgr and figure out how y’all are going to save Fort Worth in general. Everybody building and buying needs to go home and y’all help just us and we can all pull out of this preposterous situation of too many apartments already. This town was founded by people of the prairie with their own homes, yards, dogs, etc. not people sealed into places with little light much less the all tormenting lawn. By doing so, allowing too many apartments, you are also denying future kids real outdoor experience and I think the people here today say, right now is enough because the upkeep of everything really depends on how strong our city and our county are and it boils down to potholes not crypto crime so quit wasting our time looking for a quick dollar and get to work.
Rhonda L. Herd Keller M.A.,M.L.S.
FW Homeowner
The fact that this opinion leans so heavily on PAUL KRUGMAN should tell you all you need to know! For those who need it spelled out, Paul Krugman is the man who dismissed the internet as nothing more than an elaborate fax machine – in 1999!! To the commenter above, to allude that Bitcoin mining is a distraction and idisruptive to getting to real business is akin to telling your employer yiu can’t get work done because you’re too focused on growing green grass! Lastly, cherry/picking the last 4 months is disingenuous at best, zoom out, with or without the City of Ft Worth, Bitcoin is here to stay!!