White House Boots Chinese Crypto Miner

Monday President Biden issued an order prohibiting the purchase and requiring the divestment of certain real estate operated as a cryptocurrency mining facility located within one mile of Francis E. Warren Air Force Base, as well as requiring the removal of certain improvements and equipment at the property.

MineOne acquired the property in June 2022 and then made improvements to allow for use of the property for specialized cryptocurrency mining operations within one mile of F.E. Warren AFB in Cheyenne, Wyoming, a strategic missile base and home to Minuteman III intercontinental ballistic missiles.  

The Committee on Foreign Investment in the United States (CFIUS or the Committee) reviewed and investigated this transaction pursuant to authorities provided by Congress in the Foreign Investment Risk Review Modernization Act of 2018 (FIRRMA) to cover real estate transactions in close proximity to certain sensitive U.S. facilities, including F.E. Warren AFB.

“Today’s divestment order underscores President Biden’s steadfast commitment to protecting the United States’ national security.  It also highlights the critical gatekeeper role that CFIUS serves to ensure that foreign investment does not undermine our national security, particularly as it relates to transactions that present risk to sensitive U.S. military installations as well as those involving specialized equipment and technologies,” said Secretary of the Treasury Janet L. Yellen.

CFIUS identified national security risks arising from the transaction relating to the proximity of the property to F.E. Warren AFB. CFIUS also assessed the risk associated with the presence of specialized equipment on the property used to conduct cryptocurrency mining operations, some of which is foreign-sourced and presents significant national security concerns.  The proximity of the foreign-owned cryptocurrency mining facility to a strategic missile base and key element of America’s nuclear triad, and the presence of specialized and foreign-sourced equipment potentially capable of facilitating surveillance and espionage activities, presented a significant national security risk that led to CFIUS’s referral to the President.  To address this risk, the President’s order directs both the prompt divestment of foreign ownership of the property as well as the removal of the equipment and improvements that were added to the property.

By law, CFIUS is authorized to negotiate and enter into an agreement or take other actions to mitigate the national security risk arising from a covered transaction.  In some cases, however, CFIUS determines that mitigation of the national security risk is not adequate or appropriate, and that the President should prohibit a transaction.  In such instances, most transaction parties voluntarily take steps to forgo or abandon a transaction.  In other cases, parties are unwilling or unable to take actions or to timely agree to terms and conditions the Committee deems necessary to adequately address the national security risks.  In all CFIUS reviews, the parties’ conduct can impact the Committee’s assessment of what steps or actions are needed to resolve national security risks.

“If CFIUS parties are unwilling or unable to fully address national security risks, CFIUS won’t hesitate to exercise the full scope of its authorities, including Presidential referrals, to address the risk,” said Assistant Secretary of the Treasury for Investment Security Paul Rosen.  Rosen added that “CFIUS expects complete, accurate, and timely information, particularly when serious national security issues are on the line.”

MineOne did not file the transaction with CFIUS until after CFIUS’s non-notified team investigated the transaction as a result of a public tip.  CFIUS’s non-notified function has been enhanced by authorities provided by Congress in FIRRMA and ongoing appropriations to support the Committee’s ability to identify and review non-notified transactions.   

By law, CFIUS may enter into a negotiated mitigation agreement only if it is effective, verifiable, and monitorable based on a careful evaluation.  In this case, the Committee determined that it would not be possible to enter into a negotiated agreement with MineOne that would sufficiently address the national security risks in an effective, verifiable, and monitorable manner, resulting in CFIUS’s referral to the President.

This decision is based on the facts and national security risks related to this transaction only.  The CFIUS process focuses exclusively on identifying and addressing national security concerns arising from a covered transaction on a case-by-case basis, which reinforces CFIUS’s commitment to encouraging foreign investment while protecting national security.  

View a copy of the President’s order.

ABOUT CFIUS

CFIUS is an interagency committee authorized to review certain transactions involving foreign investment in the United States and certain real estate transactions by foreign persons, in order to determine the effect of such transactions on the national security of the United States.  CFIUS is chaired by the Secretary of the Treasury and includes as members the Secretaries of State, Defense, Commerce, Energy, and Homeland Security, the Attorney General, the Director of the White House Office of Science and Technology Policy, and the U.S. Trade Representative.  The Director of National Intelligence and the Secretary of Labor participate as non-voting, ex-officio members, and the Secretary of the Department of Agriculture is a member when a case involves elements of the agricultural industrial base that have implications for food security.