Bitcoin miners profit significantly by halting operations due to a severe winter storm in the US.

Earlier this week, a significant winter storm in the US compelled Bitcoin miners to reduce their operations, resulting in a substantial decrease in computing power on the network within a brief period.

Data indicates a 40% decline in hashrate from January 23 to January 25, with approximately 455 EH/s going offline, leading to block production slowing to about 12 minutes for a period.

Graph illustrating Bitcoin’s hashrate from January 20 to January 30, 2026 (Source: CoinWarz)

The fact that the most significant decrease originated from Foundry USA, the largest mining pool with a dominant presence in the US, suggests that the reduction was due to curtailments.

Graph displaying the 30-day distribution of Bitcoin’s hashrate by mining pools on January 30, 2026 (Source: Hashrate Index)

Why are so many miners able to quickly shut down? What motivates their decisions, and what implications do these choices have for Bitcoin’s security budget, transaction flow, and the politics surrounding large industrial loads on a grid that can become stressed during extreme cold?

Curtailment 101: miners as adaptable load, not fragile infrastructure

While the definition of curtailment is straightforward, its implementation can be quite complex. At its most basic level, it involves miners decreasing their electricity consumption, either partially or entirely, due to power being scarce, costly, or contractually more valuable to sell back to the grid than to utilize for hashing.

In the US, particularly in Texas, this option has evolved into a comprehensive business model. ERCOT has specifically developed mechanisms designed for “large flexible customers” that can reduce load during peak demand, identifying Bitcoin mining facilities as a primary example.

The concept is simple: if a load can decrease quickly, dependably, and repeatedly, a grid operator can regard it as a pressure-release valve during tight conditions.

In actual mining operations, curtailment generally falls into three categories.

The first is purely economic. Miners monitor a straightforward spread: revenue per unit of hash compared to the complete cost of producing that hash. When real-time electricity prices surge, the most economical decision may be to halt hashing.

This is not an act of charity, nor is it a corporate ethical stance. It is simply basic unit economics assessed minute by minute, particularly for miners exposed to wholesale pricing.

The second is contracted. Some miners enter into demand-response agreements where the “off switch” effectively becomes part of the offering they provide.

Texas has provided various ways for flexible load to engage in reliability programs, and recent years have seen numerous instances of miners profiting during stress events by curtailing or selling contracted power back to the market.

Company disclosures indicate that miners can earn income by not consuming power when the grid is tight. In Riot’s August 2023 update, the company detailed its earnings in two segments: $24.2 million from “power Credits,” described as power curtailment credits earned by selling contracted power back to ERCOT at market spot prices, plus $7.4 million in “demand response credits,” linked to participation in ERCOT demand response programs.

The smaller, routine instances of this can be found in nearly all of Riot’s monthly reports. In its November 2025 update, Riot reported $1 million in estimated power curtailment credits and $1.3 million in estimated demand response credits, noting that these demand response credits stemmed from participation in ERCOT and MISO programs and that the total credits are netted against its overall power costs.

Iris Energy’s investor update from August 2023 indicated that its Texas site generated approximately $2.3 million in “power sales,” characterized as power credits primarily driven by voluntary curtailment under hedge contracts linked to ERCOT real-time prices.

In this arrangement, a mining site resembles a hybrid of a data center and power trader rather than the old perception of a warehouse that merely operates ASICs until they fail.

The third category is emergency or rule-driven. Texas now anticipates that the largest new loads will be curtailment-ready as a prerequisite for interconnection during grid-emergency situations, explicitly citing crypto miners and data centers among the targets.

This is significant because it transforms curtailment from a desirable feature into something that is now integrated into the operational plan.

What makes this week’s storm a valuable learning opportunity is that the incentives align.

Cold snaps increase heating demand, tightening reserve margins and often triggering conservation alerts. The storm was highly disruptive to the US energy system, with price surges and operational strain reported across various regions.

Thus, if you’re a miner with a flexible load arrangement, curtailment is often the most logical response to a grid that suddenly values a megawatt more than a terahash.

This is also why the pool-level dynamics can shift rapidly. When US-dominant operators curtail, their pools reflect it almost instantly. The curtailment effect from this week was most noticeably observed through the significant drop in Foundry’s hashrate and the subsequent slowdown in block production.

While the network is global, the marginal hashrate shift can still be regional when enough capacity concentrates behind a few operators and grid systems.

Bitcoin’s difficulty timer: why slow blocks are typically a temporary burden

A hashrate shock can alarm individuals because they directly associate it with security. While that is accurate, it is true only to a limited extent, as fewer hashes per second implies that the brute-force cost of attacking the chain is lower than it would be at peak hashrate.

However, the more critical operational inquiry is how Bitcoin responds when hashes vanish quickly. The answer is that Bitcoin possesses a built-in recalibration mechanism with a delay.

Bitcoin aims for one block approximately every 10 minutes, but it does not adjust difficulty continuously. It modifies difficulty every 2,016 blocks based on the time taken to mine the last 2,016 blocks.

This structure creates the short-term “storm tax.” If numerous miners cease operations today, block production will be slow today. However, the difficulty does not instantly decrease to compensate; the network simply produces blocks at a slower pace until enough blocks are mined for the next adjustment to reprice the effort.

You could observe this occurring in real-time this week. CoinWarz’s difficulty dashboard displayed the network operating slower than the 10-minute target, with average block times exceeding the target during the monitored period.

When block production extended to approximately 12 minutes, it illustrated the experience of that delay: fewer blocks per hour, slower average confirmations, and a mempool that can thicken if transaction demand remains constant.

However, slow blocks do not signify Bitcoin “breaking”; rather, they represent Bitcoin charging users and miners a time cost for sudden changes in hash supply.

If the shock dissipates quickly and miners come back online as prices stabilize and grid stress alleviates, the network may never require a difficulty adjustment. If the shock endures, the subsequent adjustment will lower difficulty and bring block timing back toward the target.

The fee market can also behave in ways that may confuse casual observers. A brief period of slow blocks can increase fee pressure if demand remains steady, but it can also pass without incident if the mempool wasn’t already tight and demand is weak.

The key takeaway here is that Bitcoin’s design presumes that mining power is opportunistic and sometimes transient. Difficulty adjustment is the protocol’s approach to acknowledging that reality without turning every local infrastructure event into a systemic crisis.

Winter storms as repeated stress tests: Uri, Elliott, and what 2026 contributes

This is not the first instance where winter weather has impacted Bitcoin. What has changed is the scale of the US footprint and how integrated miners have become in grid programs.

Begin with Winter Storm Uri in February 2021, the modern reference point for the trauma experienced by the Texas grid. Uri triggered an unprecedented demand surge while generation faltered across various fuel types, leading to widespread outages and a political reckoning.

At that time, large-scale Bitcoin mining was significantly less intertwined with Texas reliability strategies. The industry was smaller within the state, and the concept of “miners as flexible load” was largely theoretical. This contrasts sharply with today’s scenario, where curtailment is easier to coordinate and much more prevalent.

Uri is significant to this narrative because it establishes the political context. Following a crisis of that magnitude, any substantial new electricity user is measured against a straightforward question: Will you improve or worsen the next emergency?

Now, consider Winter Storm Elliott in December 2022, an event that more closely resembles this week’s hashrate pattern. Galaxy’s 2022 mining report characterized Elliott as a moment when miners curtailed as much as 100 EH of hashrate, representing roughly 40% of network hashrate at that time, in an effort to help stabilize the grid.

Separate academic and policy discussions have also noted similar magnitude, underscoring that Elliott was a significant curtailment event rather than a mere blip in hashrate.

Elliott serves as a clear comparison because it demonstrated two concurrent realities. First, large miners can shut down at scale on short notice during extreme cold. Second, once miners incorporate curtailment into their commercial arrangements, those shutdowns become recognizable and, in certain instances, anticipated.

What does 2026 contribute? It introduces the reality that “flexible load” is no longer predominantly associated with miners, but encompasses a broader category of large compute loads.

The US Energy Information Administration has identified Texas as a hub of rapid electricity demand growth, explicitly acknowledging data centers and cryptocurrency mining as significant contributors and highlighting ERCOT’s task-force style oversight concerning large loads.

This is important because the grid politics shift when flexible load ceases to be a niche. As AI data centers and other compute-intensive facilities compete for the same interconnection capacity and public patience, miners lose the ability to argue that they are a unique case.

They become one segment within a wider discussion regarding who receives power first during stress and who finances the grid upgrades required to serve everyone.

Bloomberg’s coverage of the storm pointed in the same direction, discussing how large industrial loads, including crypto mines and data centers, reduced power consumption during the event and how ERCOT’s demand expectations evolved as conditions changed.

This kind of framing from mainstream media serves as a reminder that the next decade of mining in the US will be narrated through grid governance as much as through Bitcoin price cycles.

Thus, the hashrate decline this week is best interpreted as a preview. As the US share of mining remains significant and compute loads continue to scale, weather events will consistently result in these short-term network slowdowns. The protocol can manage them. However, the political landscape is less accommodating.

Bitcoin’s difficulty timer makes curtailment sustainable for the chain, and flexible-load economics can render curtailment profitable for miners. The open question remains whether regulators and residents will accept the arrangement: a substantial new load that commits to disconnecting when requested, in exchange for the right to connect during other times.

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