Kentucky fashions itself a friend to bitcoin, approves $4M in electricity discounts to local miner

Kentucky previously passed tax breaks for bitcoin miners in 2021

article-image

Alexander Lukatskiy/Shutterstock modified by Blockworks

share

Kentucky could be positioning itself as a welcoming destination for bitcoin miners in search of more affordable energy options.

To that end, the state’s utility authority, the Public Service Commission (PSC), recently greenlit over $4 million worth of electricity discounts for local mining outfit Bitiki-KY.

The Kentucky Utilities Company had previously committed to these discounts for Alliance, the parent entity of Bitiki, in October 2022 under a 10-year agreement. Referred to as an “economic development rider” in the industry, these discount credits have been allocated to Bitiki for the initial five years of the contract.

As part of securing the lower rate for electricity, Bitiki agreed to invest approximately $25 million in its facilities, to develop a mining location in Waverly, Kentucky and to create five new jobs. 

The contract also stipulated that should Bitiki default, it would have to reimburse the utilities company for a percentage of the discount credits.

This plan sparked some skepticism by political organizations and energy-focused societies alike, the Kentucky Lantern reported on Wednesday. To address those concerns, the PSC opened a case in November 2022 to investigate whether the discounts were reasonable or not.

These groups, which included Kentucky Solar Energy Society and the Kentucky Resources Council, argued that the jobs being created by Bitiki might not be worth the millions in discounts. They also questioned whether discounts should be saved for other industries that could create more jobs for Kentucky residents. 

However, the PSC essentially handwaved those concerns in a Monday order, saying that the state’s utilities company isn’t required under state law to mandate that a company create a certain number of jobs in exchange for discounts. 

“Bitiki has asserted that it plans to make $25 million in capital investments and its project will create five jobs. [The Kentucky Utilities Company] is not required to demonstrate minimum levels of investment or job creation. The Commission has no reason to doubt the veracity of Bitiki’s assertions,” the PSC order said.  

The contract was approved effective immediately thanks to the signed order, and the utilities company will now have to file an annual report with the PSC detailing Bitiki’s revenues and the marginal costs it has incurred through serving Bitiki with the discounts.

This isn’t the first Kentucky has pursued policy objectives that could be interpreted as attractive to bitcoin miners. 

Governor Andy Beshear signed a law in March 2021 granting tax breaks to cryptocurrency miners who operate within the state.

Just a year later, a study out of the University of Cornell found that Kentucky ranked among the top states to set up a mining operation.


Get the news in your inbox. Explore Blockworks newsletters:

Tags

Decoding crypto and the markets. Daily, with Byron Gilliam.

Upcoming Events

Old Billingsgate

Mon - Wed, October 13 - 15, 2025

Blockworks’ Digital Asset Summit (DAS) will feature conversations between the builders, allocators, and legislators who will shape the trajectory of the digital asset ecosystem in the US and abroad.

Industry City | Brooklyn, NY

TUES - THURS, JUNE 24 - 26, 2025

Permissionless IV serves as the definitive gathering for crypto’s technical founders, developers, and builders to come together and create the future.If you’re ready to shape the future of crypto, Permissionless IV is where it happens.

Brooklyn, NY

SUN - MON, JUN. 22 - 23, 2025

Blockworks and Cracked Labs are teaming up for the third installment of the Permissionless Hackathon, happening June 22–23, 2025 in Brooklyn, NY. This is a 36-hour IRL builder sprint where developers, designers, and creatives ship real projects solving real problems across […]

recent research

Research Report Templates (19).png

Research

Suilend has grown into the top money market and liquid staking provider on Sui. STEAMM, Suilend’s Superfluid AMM, presents a compelling avenue for growing market share within Sui’s DEX landscape and revenue generation for the protocol. Suilend’s multi-product suite position it well for owning market share across key verticals. While current metrics across the Sui ecosystem are likely inflated due to Sui Foundation incentive programs, SEND trades at amongst the lowest multiples in the lend/borrow sector, suggesting that a bull case for continued growth in the ecosystem may be mispriced.

article-image

The stablecoin issuer now plans to offer 32 million Class A common stock shares at a price of up to $28 each

article-image

Let’s go whale watching, Bitcoin style: Investigating the mysterious “12ib7” wallet now worth $3.2 billion

article-image

Bitget’s L2 is undergoing a leadership change and will be helmed by Colin Goltra, formerly the blockchain’s chief growth officer

article-image

The funding was spread out across 61 rounds, a slight dip in both number of rounds and total funding in comparison to other months

article-image

Why is it controversial to say things are better than they used to be?

article-image

Wallchain could make influencer ROI more measurable for Solana businesses