As Michigan quickly becomes one of the new frontiers for cryptocurrency mining, these types of decisions will hold the potential to either uplift or further exploit its communities. Supporters tout the promise of economic development and innovative technology. At the same time, residents and local governments are left to deal with not only the noise pollution, but the environmental destruction and the stress on our energy grid. This article dives into the escalating battle between Michigan communities and crypto mines, unpacking what’s at stake and what communities can do to address the problem.

The Rise of Crypto Mines in Michigan

It’s easy to see why Michigan, and other states with inexpensive energy like Georgia and Wyoming, have become magnets for crypto miners. The state’s legislative landscape has been largely a Wild West until now. Now, crypto mining operations are pouring into this remote area. They are drawn in by the allure of success on the new frontier of digital currency. In Michigan, some of the state’s lawmakers view cryptocurrency as a vital component of the state’s financial future. More importantly, they believe it has the potential to be an economic growth driver. Representative Posthumus stated that "Everything in the financial world is going to be based on blockchain and digital asset technology," and that Michigan has the opportunity to "lead in this space or play catch-up down the road." A bipartisan group of state House lawmakers in Michigan are looking to change that. They’ve even made a splash with a package of bills to increase both the use and creation of cryptocurrency within the state. Pending legislation would make it even easier for hostile investors to establish new crypto mines across the state. Incredibly, it will allow the creation of mines on old nat gas wellheads.

This tide of crypto mines hasn’t come without its costs. People in every community across the state are dealing with the destructive impact of these operations. In response, consumers are calling for increased oversight and stricter standards. It's currently difficult to say how many crypto mines exist in Michigan, because they're not licensed or tracked by the state.

The Environmental Impact

20 Crypto mining operations require massive inflow of electricity. This energy powers enormous, purpose-built computers to crunch complicated algorithms and verify blockchain transactions. With a growing energy demand, this increases the dependence on fossil fuel-fired power plants. Consequently, emissions of harmful pollutants such as particulate matter (PM2.5), NOx, SO2, and climate change causing CO2 rise precipitously. Mining one Bitcoin uses the equivalent electricity of an average American home over 41 days. That’s an extraordinary use of energy!

Crypto mining operations are responsible for increasing PM2.5 pollution by over 10 tons per year. This is an enormous threat to health, particularly for sensitive populations including children, older adults and people with pre-existing medical conditions. Crypto mining operations not only worsen air pollution, they require massive quantities of water for cooling purposes. This represents a profound threat in areas facing water scarcity.

The Noise Factor

One of the most disruptive and immediate effects of crypto mines is noise pollution. Computer fans and cooling systems of all types buzz constantly, producing major hum. This racket can be a huge aggravation to adjacent homeowners and universities. Crypto mines create noise pollution as high as 70 to 75 decibels. For reference, this much sound exposure is equivalent to the risk of hearing loss from the sound of a moderately loud vacuum cleaner or clothes dryer running nearby.

In nearby Dafter Township, residents have complained of extreme noise pollution coming from an in-state crypto mine operated by Digihost. According to local residents and school staff, the sound is an unending racket. It overwhelms the calming sounds of forest critters. The noise has raised alarms over long-term health impacts from being subjected to the seemingly inescapable din. Other students plug their ears due to the crunching sound. Due to this lack of space, the school was forced to eliminate outdoor recess. Residents have described the noise as “an ugly sound.” They note, “ugly doesn’t hurt us,” indicating that it isn’t just an aesthetic issue but indeed a livability issue.

Balancing Economic Benefits with Community Concerns

Beyond those burdens, crypto mines power down in Michigan communities, inflicting real and significant harms while cashing in on potential economic benefits.

  • Stable electricity demand: Crypto mines provide a stable and consistent load on the electricity grid, which can help prevent rate increases for other consumers. According to Moran, "Without their large, consistent load, members would face significantly higher rate increases."
  • Job creation and local investment: Crypto mines can create jobs and stimulate local investment in Michigan. The company behind the mine in Dafter Township stated that it is "excited to continue working with Lake Superior Academy to ensure Dafter remains a safe and friendly place to live and learn, as well as working with the community and invest locally for everyone's benefit."

The real challenge is taking advantage of those economic benefits. Simultaneously, we need to be doing everything possible to mitigate harm to the environment and enhance the quality of life for longtime residents in these communities.

Navigating the Regulatory Landscape

Read more about how Michigan’s crypto mines are experiencing a regulatory vacuum. Yet local governments are left to figure out the best way to respond to their communities’ frustrations. The Michigan Townships Association is urging the state to allow local governments to have the authority to regulate crypto mines. State and local agencies can implement noise ordinances that force these mines to keep their noise down.

Pending legislation in Michigan would restrict crypto mining. Many community members fear the negative effects that these operations will bring, such as increased noise pollution. It remains to be seen whether these regulations will strike the right balance between fostering innovation and protecting the interests of Michigan residents.

At the end of the day, clean and responsible crypto mining practices are the key to allowing this burgeoning industry to thrive in harmony with Michigan’s communities. This includes implementing noise mitigation measures, investing in renewable energy sources, and engaging in open and transparent communication with local residents.