Biden Orders Shutdown of Chinese Crypto Mine Near Air Force Base Over Spying Fears

President Biden has ordered the immediate shutdown of a Chinese-owned crypto mining operation near a vital Air Force base in Wyoming due to national security concerns. The facility, operated by MineOne, was flagged as a potential security risk due to its proximity to sensitive military installations and a nearby Microsoft data center. The closure is part of a broader effort by the Biden administration to scrutinize and regulate foreign investments in sectors deemed critical to national security.

US Executive Order Targets Chinese-Owned Crypto Mining Operation Near Critical Air Force Base

In a bold move to safeguard national security, President Joe Biden has issued an executive order ordering the immediate cessation of operations at a Chinese-owned crypto mining facility situated dangerously close to a critical Air Force base in Wyoming. The order, signed on Monday, marks a significant escalation in the Biden administration's scrutiny of foreign investments in sectors deemed essential to US interests.

Proximity to Sensitive Military Installations Raises Espionage Concerns

The crypto mining operation, operated by MineOne Partners Limited and related MineOne entities registered in Delaware, has been identified as a potential security risk due to its proximity to the F.E. Warren Air Force Base, a key site for controlling nuclear-armed intercontinental ballistic missiles. The facility lies just a mile from the base, raising concerns about espionage and intelligence-gathering activities.

Microsoft Flags Threat to Pentagon Data Center

The alarm was initially raised by Microsoft, which operates a data center nearby that supports the Pentagon. In a report obtained by the New York Times, Microsoft detailed how the industrial-level computing power of the crypto mining facility, coupled with the presence of Chinese nationals, could facilitate extensive intelligence-gathering activities.

CFIUS Investigation Confirms Risks

A subsequent investigation by the Committee on Foreign Investment in the United States (CFIUS) confirmed Microsoft's concerns, prompting President Biden's decisive action. The order mandates the immediate shutdown of operations at the facility and requires the removal of all equipment within 90 days.

Part of Broader Crackdown on Foreign-Owned Tech Enterprises

This executive order is part of a broader strategy by the Biden administration to scrutinize and regulate foreign investments in sectors critical to national security. Just weeks earlier, a bipartisan bill was signed to ban the popular social media app TikTok in the United States unless its Chinese parent company divests ownership.

States Join the Fray

States are also taking similar measures to protect their technological and strategic infrastructure from foreign interference. Arkansas recently enacted laws prohibiting foreign ownership of cryptocurrency mining operations, particularly those from China, Iran, and Cuba. These laws follow reports of Chinese investors operating multiple crypto mines in the state.

Impact on Crypto Industry

The shutdown order underscores the increasingly challenging regulatory environment for the cryptocurrency industry, particularly for operations with foreign ownership. Chinese-owned crypto mining facilities have proliferated across the US since China banned such activities domestically in 2021, drawn by the US's cheap electricity and favorable legal landscape. However, these operations are now under heightened scrutiny due to their potential national security implications.

Future of US-China Tech Relations

President Biden's actions send a clear message that national security will take precedence over economic or commercial interests when foreign investments pose potential threats. This move is likely to set a precedent for future scrutiny and regulation of foreign-owned enterprises in sensitive sectors.

As the geopolitical rivalry between the US and China intensifies, the intertwining of national security concerns with technology and economic policies will become more pronounced. Businesses, especially those in high-tech and critical infrastructure sectors, will need to navigate this complex environment, reassessing their operations and compliance strategies to align with stringent US national security policies.

Additional Security Concerns Raised by Chinese Equipment

Complicating the security landscape is the fact that a vast majority of the machinery used in these crypto mining operations is manufactured by Chinese companies. This raises concerns about supply chain vulnerabilities and potential backdoors that could be exploited for espionage purposes.

Biden's Order Sends Clear Message

President Biden's executive order sends a clear message that the US will not tolerate foreign investments that jeopardize national security. It marks a significant step in the Biden administration's efforts to protect the nation's technological and strategic infrastructure from foreign interference.