Bitcoin mining companies move to rural Texas town

For decades aluminum was produced at the sprawling Alcoa industrial complex just southwest of Rockdale. The work then was fueled by a coal-fired power plant. 

Now, not far from the main Alcoa site, a new kind of mining operation is underway by a company called Whinstone, a subsidiary of Riot Blockchain, Inc..

“Right if you think about it, like old technology to create power, new technology to use power and the term coined; mining is used. It is an interesting way to look at it,” said CEO Chad Harris.

FOX 7 Austin was given a tour of the facility which was built from the ground up. Inside one of the three long buildings, there are walls of computers that tower overhead. The buildings are 1,050 feet long about the size of three football fields. Each computer- called a miner – make complicated crypto-currency calculations; the reward Bitcoins.

“What drove us to Texas was two things. One, A; we needed power. And B; I read an article in a magazine called Wired Magazine and it was called ‘Hard Luck Town Bet on Bitcoin and Lost’,” said Harris.

A few years ago a different cyber currency company came to Rockdale. It’s located not far from Whinstone, on the Alcoa complex, and is currently ramping up. Whinstone meanwhile has 150 employees and more than 200 construction workers doing an expansion project.

“We quickly realized, that we were actually creating a workforce culture that bled into the community,” said Harris.

Now similar companies want to know about this town of fewer than 6,000 people. “We are getting on average two to three calls every week from different miners, in fact I spoke to one this morning, that was interested in coming,” said Rockdale Economic Development director Jim Gibson.

There is a lot of loss ground to make up. When the Alcoa complex shut down, 1,700 jobs were lost as well as an estimated 30% of Milam County’s tax revenue. The arrival of Bitcoin miners, a new type of high-tech business, is not being portrayed as a savior by city officials. It is, however, generating something Rockdale hasn’t felt for years.

“There is a heartbeat, I think it started with our “blue sky” video we did,” according to Mayor John King.

That campaign four years ago was an attempt to bring Amazon to town. The goal then and now is to get store fronts to reopen.

“We haven’t seen any real new businesses crop up in town, yet. (Is that the next step?) I think so, it’s obviously the next step as we continue to grow and the publicity we are getting out of the Bitcoin says here is a small town out here that’s ready to thrive,” said King.

An example of that is Abi Vasquez. Family members once worked at Alcoa and she saw what the closure did to Rockdale. “It was becoming a ghost town,” said Vasquez.

Vasquez moved but eventually came back. Now, as a Whinstone Project Administrator she is not just witnessing the changes in town, but helping make them. “Oh, it’s amazing, it’s a great feeling.”

Earlier in the week, the 31 mile long Alcoa property was purchased for $240 million by a North Texas investment group. It’s believed several parts will be redeveloped which is why the town’s big bet may not be a Bitcoin payoff. A deal involving a more traditional manufacturer is being finalized. That company may also locate on the Alcoa complex and may bring more than a thousand jobs to Rockdale.

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