These 10 states are leading America in creating a crypto economy

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Investing in cryptocurrencies is clearly not for the faint of heart. Bitcoin’s value has plummeted from its peak last fall, and others have followed similar heartbreaking paths.

However, that doesn’t mean the revolutionary technology behind it, which enables innovations like smart contracts and instant peer-to-peer payments, won’t last. Because of this, many states are vying for leadership in this burgeoning industry.

With that in mind, CNBC’s America’s Top States for Business study – which ranks all 50 states based on a wide range of competitive characteristics – is giving cryptocurrency special attention as part of this year’s methodology.

Our key category, Cost of Doing Business, has always included the cost of electricity, a key consideration in this energy-hungry industry. This year, our Technology and Innovation category includes a measure of each state’s share of computing power, or “hash rate.” And our Business Friendliness category pays special attention to how governments regulate this increasingly important industry.

Based on these metrics, these ten states are leaders.

10.Texas

A worker installs a new set of bitcoin mining machines at the Whinstone US bitcoin mining facility in Rockdale, Texas on October 9, 2021.

Mark Felix | AFP | Getty Images

“It’s happening,” said Republican Gov. Greg Abbott tweeted last year. “Texas will be the crypto leader.”

He may be right. The Lone Star State is consistently at or near the top in terms of mining capacity, sitting neck and neck with Georgia. Electricity is affordable even before crypto miners go on sale, even though the state’s independent power grid has had reliability issues. Texas has started regulating cryptocurrencies to give them a solid foundation for growth.

Mining Capacity: No. 2

Electricity costs: #16

Regulation: No. 21 (tie)

9. Kentucky

Jacob Melin poses for a portrait at the Crypto Consulting Group LLC offices in Louisville, Ky.

Luke Sharret | The Washington Post | Getty Images

Mining runs deep inside Kentucky’s legacy, but these days the state is swapping coal for crypto. Last year, Democratic Gov. Andy Beshear signed into law a series of tax breaks for cryptocurrency mining, including an extension electricity incentives intended for the use of renewable energy to include the growing industry. The tax breaks are already working to attract miners. The state also began updating its financial regulations to include crypto.

Mining Capacity: #3

Electricity costs: #13

Regulation: No. 21 (tie)

7. (Draw) Virginia

Director of Technology Shawn Dailey holds a power cable during the construction of a Bitcoin data center in Virginia Beach, Virginia.

Steve Helber | AP

7. (tie) Idaho

An electric wind farm outside of Boise, Idaho on May 24, 2021.

Aaronp/bauer-griffin | GC Images | Getty Images

6. Washington

Washington State Governor Jay Inslee and other leaders address the press March 28, 2020 in Seattle, Washington.

Karen Ducey | Getty Images

5. Utah

Here’s a pile of bitcoins after software engineer Mike Caldwell minted them at his shop in Sandy, Utah.

George Frey | Getty Images

The Beehive State is diligently working on regulations for blockchain, and in March Republican Gov. Spencer Cox signed legislation into law that would allow state and local governments to accept payments in the form of digital assets. The state has also formed a new task force on blockchain innovation.

Mining Capacity: #23

Electricity costs: #3

Regulation: No. 1 (tie)

4. North Dakota

Kevin O’Leary, Chairman of O’Shares ETFs for O’Leary Funds Management LP, speaks during the Bitcoin 2022 conference in Miami, Florida, on Wednesday, April 6, 2022.

Eva Marie Uzcategui | Bloomberg | Getty Images

3. Oklahoma

An engineer inspects an AMD graphics processing unit (GPU) from Sapphire Technology Ltd on Wednesday, January 22, 2021. at the Evobits crypto farm in Cluj-Napoca, Romania.

Akos Stiller | Bloomberg | Getty Images

2. Wyoming

Blockchain-based payments company Ripple Labs has registered a company in Wyoming, which has more “crypto-friendly” laws.

CTRL/STAR MAX/IPx | AP

1.Nebraska

Nebraska, Kearney, Great Platte River Road archway over Interstate 80, bison sculpture in foreground.

Bernhard Friel | Universal picture group | Getty Images

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