Chinese mining giant Bitmain has decided to temporarily suspend operations in Rockdale Texas, partially due to the signifiant drop in cryptocurrency prices. The news comes amid reports a new CEO would be named to replace co-founders Wu Jihan and Zhan Ketuan.
Bitmain announced the launch of its Rockdale data center back in summer 2018. Estimates were the new facility would bring about 400 local jobs to Rockdale in the first two years. Many in the roughly 5,800-person strong city were interested and excited to see what Bitmain could bring to the area. Greater Milam County was struggling economically after the Alcoa power plant and a smelter closed its doors, contributing to a 30% loss in tax revenue.
Bitmain’s Decision Met With Disappointment
The decision by Bitmain came as a disappointment to Milam County Judge Steve Young. He characterized the mining operation as a “step in the right direction” to bring positive news, tax revenue, and jobs to the area. Bitmain reportedly had 7,000-8,000 servers in the Rockdale mining facility and had poured millions to renovate the old Alcoa power plant to meet its needs.
Judge Young said Bitmain officials informed him work in Rockdale would be able to continue with a scaled back plan, even though initial reports said operations were suspended. Five Bitmain employees still remain at the Rockdale site, according to Judge Young.
Rockdale officials have spent a lot of time marketing the land around the old power plant to other companies due to the presence of a big power grid and other established infrastructure. County officials pitched the area to Amazon when it was searching for a second headquarters spot.
Trouble On The Horizon For Bitmain
Bitmain has seen its company go through dramatic shifts in an effort to adjust to a prolonged cryptocurrency bear market. It filed for an initial public offering (IPO) in Hong Kong back in September.
The company was sued in U.S. federal court over allegations it was siphoning processing speed off to the company, and has reportedly fired a significant portion of its global workforce.