Risks to National Security
President Biden has ordered the shutdown of a Chinese-owned crypto mining facility near a key Air Force base in Wyoming. The mine was located just a mile from the F.E. Warren Air Force Base, which controls nuclear missiles.
Microsoft had raised concerns that the mine’s proximity to military installations and a nearby Pentagon data center could facilitate Chinese espionage. The facility’s powerful computing capabilities and the presence of Chinese nationals posed significant risks.
Broader Crackdown on Foreign Investments
This shutdown is part of a broader Biden administration effort to regulate foreign investments in critical sectors. Recently, a bill was signed to ban TikTok unless its Chinese owner gives up ownership.
Arkansas has also enacted laws to prohibit foreign ownership of crypto mining operations, especially those from China.
Impact on Crypto Industry
The shutdown highlights the challenges facing the crypto industry, particularly for foreign-owned operations. Chinese-owned crypto mines have been proliferating in the US due to cheap electricity and favorable laws. However, they are now under increased scrutiny.
The MineOne facility must remove all equipment within 90 days and sell or transfer the property within 120 days. The majority of machinery used in these operations is manufactured by Chinese companies, further complicating security concerns.
Future of US-China Tech Relations
Biden’s actions prioritize national security over economic interests when foreign investments pose threats. This move sets a precedent for future scrutiny of foreign-owned enterprises in sensitive sectors.
As the US-China rivalry intensifies, national security concerns will increasingly intertwine with technology and economic policies. Businesses in critical sectors must reassess their operations and compliance strategies to align with stringent US national security policies.
