The 15 Best U.S. States to Mine Cryptocurrency

Cryptocurrency (or “crypto”) refers to digital currencies that can be used to buy regular goods and services. But instead of relying on paper money or banks to complete transactions, cryptocurrencies make use of a decentralized online ledger to verify transactions.

Cryptocurrencies can be bought through exchanges using traditional currencies. But many can also be earned through a process called “mining,” which requires specialized software to solve complex mathematical problems.

Successful crypto mining depends on good computing power and is extremely energy-intensive. For example, a single bitcoin transaction is estimated to use nearly 2,000 kWh of electricity — enough to power the average U.S. household for over two months.

The crypto market has boomed during the COVID-19 pandemic. For example, bitcoin could be purchased for less than $6,000 in the early days of the pandemic and rose to over $63,000 in April of 2021, a nearly 10-fold increase in price.

As interest in trading cryptocurrency increases, so does interest in mining. While bitcoin mining has become extremely difficult, mining other crypto coins is much easier. Because crypto mining is so energy-intensive, living in an area with low electricity rates makes mining more profitable.

Residents of states with no state income taxes or low state income tax burdens will pay less in taxes on gains realized on the sale or exchange of currencies, which are treated as capital assets.

To find the best states to mine cryptocurrency, researchers at Commodity.com analyzed data from the U.S. Census Bureau, the U.S. Energy Information Administration, the Bureau of Economic Analysis, and HighSpeedInternet.com, creating a composite score based on the following factors:

• State income tax burden
• Electricity rates
• Cost of living
• Percentage of households with broadband internet
• Average internet speed

Here are the best states for mining cryptocurrency.

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15. Wyoming

Composite score: 59.75

State income tax burden: 0.0%

Electricity rates (cents per kWh): 11.2

Cost of living (compared with average): -7.2%

Percentage of households with broadband internet: 66.7%

Average internet speed (Mbps): 60.0

14. Utah

Composite score: 61.25

State income tax burden: 2.2%

Electricity rates (cents per kWh): 10.6

Cost of living (compared with average): -3.5%

Percentage of households with broadband internet: 75.6%

Average internet speed (Mbps): 93.0

13. Texas

Composite score: 62.75

State income tax burden: 0.0%

Electricity rates (cents per kWh): 12.0

Cost of living (compared with average): -3.5%

Percentage of households with broadband internet: 67.6%

Average internet speed (Mbps): 110.7

12. Arkansas

Composite score: 63.25

State income tax burden: 2.0%

Electricity rates (cents per kWh): 10.4

Cost of living (compared with average): -15.3%

Percentage of households with broadband internet: 55.6%

Average internet speed (Mbps): 64.9

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11. Missouri

Composite score: 63.50

State income tax burden: 1.9%

Electricity rates (cents per kWh): 10.9

Cost of living (compared with average): -11.3%

Percentage of households with broadband internet: 64.6%

Average internet speed (Mbps): 86.9

10. Florida

Composite score: 64.00

State income tax burden: 0.0%

Electricity rates (cents per kWh): 11.6

Cost of living (compared with average): +1.0%

Percentage of households with broadband internet: 72.7%

Average internet speed (Mbps): 102.0

9. Ohio

Composite score: 64.00

State income tax burden: 1.3%

Electricity rates (cents per kWh): 12.1

Cost of living (compared with average): -11.6%

Percentage of households with broadband internet: 70.6%

Average internet speed (Mbps): 77.2

8. Mississippi

Composite score: 64.75

State income tax burden: 1.5%

Electricity rates (cents per kWh): 11.3

Cost of living (compared with average): -15.6%

Percentage of households with broadband internet: 49.6%

Average internet speed (Mbps): 74.3

7. South Dakota

Composite score: 67.00

State income tax burden: 0.0%

Electricity rates (cents per kWh): 11.8

Cost of living (compared with average): -12.2%

Percentage of households with broadband internet: 70.3%

Average internet speed (Mbps): 70.8

6. Nevada

Composite score: 67.25

State income tax burden: 0.0%

Electricity rates (cents per kWh): 11.4

Cost of living (compared with average): -2.6%

Percentage of households with broadband internet: 72.2%

Average internet speed (Mbps): 104.1

5. Louisiana

Composite score: 70.00

State income tax burden: 1.7%

Electricity rates (cents per kWh): 9.5

Cost of living (compared with average): -12.1%

Percentage of households with broadband internet: 60.6%

Average internet speed (Mbps): 84.1

4. Washington

Composite score: 70.50

State income tax burden: 0.0%

Electricity rates (cents per kWh): 9.7

Cost of living (compared with average): +8.4%

Percentage of households with broadband internet: 78.0%

Average internet speed (Mbps): 103.9

3. Oklahoma

Composite score: 70.75

State income tax burden: 1.7%

Electricity rates (cents per kWh): 10.0

Cost of living (compared with average): -12.8%

Percentage of households with broadband internet: 59.4%

Average internet speed (Mbps): 87.9

2. Tennessee

Composite score: 70.75

State income tax burden: 0.0%

Electricity rates (cents per kWh): 10.8

Cost of living (compared with average): -10.3%

Percentage of households with broadband internet: 65.3%

Average internet speed (Mbps): 94.3

1. North Dakota

Composite score: 72.00

State income tax burden: 0.8%

Electricity rates (cents per kWh): 10.5

Cost of living (compared with average): -10.7%

Percentage of households with broadband internet: 71.6%

Average internet speed (Mbps): 74.5