KEY POINTS
- A Texas district court found that the EIA's move was likely 'an abuse of discretion'
- The EIA is barred from mandating TBC members to respond to the survey
- Riot Platforms and the TBC sued the department for its 'unlawful' data collection bid
Bitcoin miners have scored a win in a battle to block the Energy Information Administration's (EIA) bid to collect data on crypto miners' energy usage, as a Texas court ruled that the agency's move was likely "an abuse of discretion."
Earlier this month, the EIA, which is a unit of the U.S. Energy Department, revealed plans to conduct a "mandatory survey focused on systematically evaluating the electricity consumption associated with cryptocurrency mining activity," which it said was necessary "to better inform planning decisions and educate the public."
The announcement was met with much uproar among Bitcoin miners, who believe the EIA was being intrusive.
Last week, top Bitcoin mining firm Riot Platforms joined hands with the Texas Blockchain Council (TBC) to sue the Department of Energy for its "unlawful so-called emergency collection of information from many of TBC's members." The complaint also said the proposed survey was "unlawfully approved" by the department's Office of Management and Budget (OBM). "This is a case about sloppy government process, contrived and self-inflicted urgency, and invasive government data collection," the complaint argued.
In a recent court order by the Waco Division of the U.S. District Court for the Western District of Texas, the court said it appreciated the EIA Administrator's willingness for full briefing on the issues presented by the plaintiffs "before any enforcement occurs." However, it found the declaration to be unsatisfactory as it "fails to bind all Defendants, does not remove the credible threat of enforcement from other defendants (or the EIA after March 25), and does not address Plaintiffs' alleged costs of compliance with the Survey."
The court also found that Riot Platforms and the TBC were able to provide proof of "immediate and irreparable injury, loss, or damage" if a temporary restraining order (TRO) was not issued.
In what could be a major blow to the EIA's bid to collect Bitcoin miners' energy usage data, the court said it believes the plaintiffs will likely succeed "in showing that the facts alleged by Defendants to support an emergency request fall far short of justifying such an action." The agency's determination regarding the need for a survey "likely violates the APA (Administrative Procedure Act) as 'arbitrary, capricious, [or] an abuse of discretion," the court said.
Under the TRO, the EIA is prohibited from requiring the TBC and its members, which includes Riot Platforms, from responding to the survey. It is also barred from collecting data as required by the survey. Finally, the EIA is not allowed to share any data that it has already received from respondents of the survey.
This comes amid increasing scrutiny over regulatory approaches toward cryptocurrencies and related activities in Texas.
Last week, the U.S. Securities and Exchange Commission (SEC) was slapped with a lawsuit that challenged its authority to regulate "practically all digital asset transactions in Texas and across the country."
