News
Biden Orders Shutdown of Chinese-Owned Cryptocurrency Mine Near F.E. Warren
A Chinese-owned cryptocurrency mine created a mile away from F.E. Warren Air Force Base poses a national security risk and must be shut down and sold, according to an executive order issued by the Biden administration.
President Joe Biden issued an executive order Monday afternoon requiring the offshore cryptocurrency company MineOne Partners Limited, as well as all related MineOne entities, to immediately cease operations, remove all equipment and improvements, and transfer ownership of their facility to an approved buyer.
The order gives the company 120 calendar days to complete the transfer of its real estate and to certify such transfer in writing to the Committee on Foreign Investment (CFIUS).
The order notes that CFIUS was never informed by the company – as it should have been – that a Chinese-owned cryptocurrency mining operation had been set up near F.E. Warren. Instead, CFIUS discovered it through a tip from a member of the general public.
The individual or individuals who tipped off CFIUS have not been identified.
F.E. Warren Air Force Base is a strategic missile base and home to the Minutemen III intercontinental ballistic missiles, which are a key element of the the nation’s nuclear triad.
Biden’s order says there is “credible evidence” to suggest that MineOne Partners Limited and its associated subsidiaries may be “taking actions that threaten to compromise the national security of the United States.”
The order also states that CFIUS determined that a negotiated settlement with the facility would not work to mitigate the national security risks of having the cryptocurrency mining operation — essentially a massive supercomputer capable of processing and analyzing quickly the numbers – so close to FE Warren.
The Cowboy State Daily contacted F.E. Warren Air Force Base and was directed to a military spokesperson who said they would not comment on the matter.
The red lights flash
The world has been changing in America for some time now, retired Air Force Col. Tucker Fagan, one-time commander of the base, told the Cowboy State Daily Tuesday morning.
“The FBI, Director (Christopher) Wray is saying there’s a flashing red light,” Fagan said. “It is, and it’s stuff like that.”
Fagan, who also served as chief of the nuclear section of the Joint Chiefs of Staff under President Ronald Reagan, said “stuff” isn’t just setting up a supercomputer right next to a military base, it’s also things like sending a spy balloon sailing on the United Statesand making public appearances with Russia and promising not to interfere with its invasion of Ukraine.
“Look at what China is doing in the South China Sea,” he said. “And in countries across Africa and the Middle East. China represents the Central Kingdom, and that’s what they think they are.”
As someone with a military background, Fagan believes there are ample signs from around the world that it’s time for America to keep an eye on who is buying what property where, particularly if it involves unfriendly countries of the United States.
“We live in a very dangerous world that doesn’t look like it’s going to get safer,” he said. “So, this country’s investment and weapons to counter an aggressive Chinese government, an aggressive North Korean government and an aggressive Russian government are absolutely necessary.”
Providing for common defense is a primary goal of uniting in government, as written in the Constitution.
“So this is what we need to do is look at the things that we need to protect the United States, our interests and our allies,” Fagan said. “We have opponents who are becoming more aggressive.”
People who come to the country with money to buy land and interests in the United States don’t always have America’s best interests at heart, Fagan said.
“We’re kind of hypnotized for some crazy reason,” he said. “Because we think: ‘No, you’ll see better this way.’ But they don’t.
Reaction of the delegation
Wyoming’s congressional delegation agreed.
“CFIUS exists for cases like this,” Rep. Harriet Hagemen told Cowboy State Daily in an email. “I supported legislation to include the USDA in CFIUS to prevent ownership of our land by the Chinese Communist Party.”
Senator Cynthia Lummis, Republican of Wyoming, also believes that the presence of Chinese companies near military bases is worrying.
“Sen. Lummis has co-sponsored legislation in the past to ban our adversaries from purchasing farmland near military bases and continues to work with colleagues to protect the Cowboy State from foreign interference,” his office told Cowboy State Daily .
The previous alarm bells
This is not the first time that MineOne Partners Limited and its associated affiliates have been mentioned as a potential security risk.
Sean Murphy of Bison Blockchain in Cheyenne had warned Wyoming legislators of a “Chinese” takeover in Wyoming. He told lawmakers that a conglomerate of about eight entities run by Chinese nationals with varying levels of connections to China had deliberately driven out his company, not long after the facility opened in October 2022.
Subsequently, in May 2023, Bison Blockchain filed a $22 million lawsuit against companies registered in Delaware and the Cayman Islands, accusing them of breach of contract and other misdeeds.
Murphy estimated that the facility could handle 10,000 to 15,000 bitcoin miners, and Bison Blockchain had agreed to pay the state $1 per month per miner. According to Murphy’s estimates, this would have represented between $1 million and $2 million in state tax revenue over a 10-year lease.
What is a cryptocurrency mining operation?
Bitcoin mining is a computer-intensive process that involves executing trillions of cryptographic formulas every second.
About every 10 minutes, a network of supercomputers will generate enough transactions to make what’s called a “block.”
This is a tamper-resistant encrypted transaction package. By entering that block into the record – a blockchain – you earn a reward.
It takes a powerful enough computer, application-specific integrated circuits (AISC), to compete with others doing the same calculations and thus earn this reward.
It has become a multi-billion dollar industry and most cryptocurrency miners have warehouses full of these ASICs.
We are all responsible
The fact that a member of the public informed CFIUS that a national security threat was emerging from F.E. Warren made Cheyenne Chamber of Commerce CEO and President Dale Steenbergen proud.
“This is a critical issue that is becoming more and more intense,” Steenbergen told Cowboy State Daily on Tuesday. “We will all have to be diligent and make sure we expel these people. I’m not here to do us any good.”
Steenbergen said Chambers of Commerce across America have been told by the National Security Agency since 2017 that they must look for such problems and red flag them.
“The Air Force has pushed us to be diligent about this,” he said. “So if you are the enemy and wish to harm us, you are not welcome in our state or our community.”
For this reason, Steenbergen has made it a priority to get legislative help to keep out foreign interests that might want to harm America.
“We worked with the Legislature to get Senate File 77 passed,” he said. “The state refused to do anything last year, but this year we were able to get the proposal approved.”
Wyoming has always been a business-friendly state, Steenbergen added, but today’s world requires greater caution at all levels.
“Wyoming has always been a very conservative, mind-your-business state,” he said. “But in a way, this allows companies to hide who they really are, and we as a nation can no longer afford that.
“China is trying to come into our backyard around our military facilities, which are our closest competitor, and we need to address that.”
Gordon agrees
Wyoming Gov. Mark Gordon released a statement late Tuesday morning agreeing with the administration’s decision.
“I am acutely aware of and have monitored the concerns of surrounding property owners, as well as the potential national security threats this operation posed,” the statement read. “I am pleased that the Administration has recognized the potential threat and has taken steps to ensure the security of our military installations and the safety of Wyoming residents. Protecting our infrastructure remains critical to protecting our national security and must always be the our top priority.”
I am also grateful to Senator Nethercott for his sponsorship SF077 – National Defense Infrastructure Reporting and Investigation to help protect Wyoming’s critical infrastructure from foreign threats. I signed this bill, effective July 1, because it provides clear direction and support for counties, under the auspices of the Wyoming Office of Homeland Security, to investigate land sales near critical infrastructure.”
Renée Jean can be reached at renee@cowboystatedaily.com.