Warren warns that foreign-owned cryptomining farms pose national security risks

Senator Elizabeth Warren has expressed serious concerns about the potential national security risks posed by foreign-owned cryptomining farms. He noted that a significant portion of these facilities, about a third, are owned by Chinese entities, some of which have direct connections to the Chinese government.

Warren noted that cryptomining not only has harmful environmental impacts, but can also pose significant security threats. He referenced a past incident involving a Chinese-owned mining facility, MineOne, located in Wyoming, which was ordered to divest following a recommendation by the Committee on Foreign Investment in the United States (CFIUS). The facility was alarmingly close to Francis E. Warren Air Force Base in Cheyenne and flagged a nearby Microsoft data center as a potential intelligence-gathering operation.

In a discussion with Assistant Secretary Rosen, who heads CFIUS, Warren asked whether the equipment in these crypto mines could be used to spy on US military operations and nuclear weapons systems. Rosen agreed that such sophisticated equipment could be used for espionage.

Warren also emphasized potential threats to the U.S. power grid, suggesting that these foreign entities could cause targeted blackouts and cyberattacks. He noted that cryptocurrencies are often used to buy these mining facilities, allowing owners to bypass traditional banking systems and anti-money laundering rules.

He further claimed that crypto mining companies have used this method to secretly send millions of dollars to China. Warren believes it is time for the United States to enact legislation to address these issues.

This recent warning from Warren follows a letter she sent to US officials in May, regarding Iran's use of crypto mining to fund attacks against Israel. He requested information on the revenue generated by Iranian cryptominers and how the US plans to deal with this threat.

The Biden administration has also taken steps to regulate the cryptocurrency mining sector, proposing a 30% tax on electricity use by miners. However, this move has been met with criticism, with some, such as Senator Cynthia Lummis, arguing that it could destroy the sector.