In this coal state of the United States, cryptocurrency mining was once seen as a hope for its revival. Now, mines are closing down, and investors are hoping that AI data centers will fill the void.
Written by: Dina Temple-Raston
Translated by: Luffy, Foresight News
If you drive to the outskirts of Compton City, with a population of less than 400, you will hear a continuous low hum from cryptocurrency mining equipment in the woods. As you get closer, the source of the low hum gradually becomes clear: low-lying metal buildings, container-like, arranged in a semi-circular shape, with fans and processors buzzing intermittently. The site is surrounded by barbed wire and surveillance cameras, with two security guards sitting in a pickup truck outside the alert line.
Such metal containers are scattered everywhere, sitting exactly on the site of former coal mines. Inside the containers, dedicated computers are solving complex mathematical problems at full speed: competing through computing power to verify Bitcoin transactions and earn small amounts of Bitcoin as a reward.
In the brief period of 2021, this area seemed to usher in a new prosperity, marked everywhere by Bitcoin. At its peak, Kentucky contributed about 20% of the mining computing power for proof-of-work type cryptocurrencies in the United States.
But here, prosperity and decline have their own historical trajectory. Local officials say that due to Kentucky's loose regulation and generally low industry transparency, it is difficult to accurately count the number of cryptocurrency mines still operating in the eastern part of the state. But locals are clear that the boom has begun to recede.
"They either build mines on someone else's land or pay local companies to provide sites," lawyer Anna Whites, who has represented multiple crypto mining clients, accused, "They will pay an initial fee or convince landowners to pay the initial fee, then mine for the first three months, and disappear without a trace just before the next billing cycle begins."
In early 2022, when Mohawk Energy launched a crypto mining project in Jenkins, Kentucky, local officials said this time would be different. Founded jointly with Kentucky Senator Brandon Smith, Mohawk Energy bought a massive 41,000-square-foot building and 8 acres of surrounding land. The company rented most of the space to a Chinese cryptocurrency mining enterprise, with the remaining areas set up as classrooms and practical training centers aimed at teaching locals to repair iPads, maintain Bitcoin mining machines, and cultivate skills needed for the digital economy. This was a big deal for Jenkins: the local public TV station reported on the project launch, with video footage showing toolboxes, workers, and smiling government officials.
"Mohawk's plan was to hire retired coal miners and disabled veterans who returned to eastern Kentucky but couldn't find work, and train them," Whites said (Mohawk was one of her clients), "Among other promises, the project offered near six-figure salaries and vowed to invest part of the mining revenue into training programs to help their development. For a while, this actually worked."
Whites said that for a brief period of about 18 months, things looked promising: 28 families achieved real gains, with one person in each family getting a stable job, and about 30 relatives finding work nearby. But when we asked about the current situation, she paused. "I believe most of them are unemployed again."
The change came suddenly. The Chinese partner sued Mohawk for breach of contract, and Mohawk countersued. The shared cryptocurrency revenue was never realized. Now, as some Kentucky residents no longer harbor illusions about Bitcoin mining, they begin to discuss AI data centers with the same tone they once used to talk about coal mines and hash rates, with a cautious expectation. They say AI might bring jobs, fiber networks, and long-term development.
Colby Kirk runs a non-profit organization called One East Kentucky, dedicated to promoting economic development in the region. He still remembers the moment the topic shifted during the Kentucky Economic Development Association's spring meeting in Paducah in April.
"There were several site selection consultants in the panel," he recalled, "They talked about data centers, mentioning many large data centers along the I-81 corridor in northern Pennsylvania, and discussed whether our communities could be prepared for such investments? One consultant responded that this would require meeting certain conditions."
It turned out these conditions were not easy: flat land, sufficient electricity, fiber networks, and a workforce with wiring and welding skills. Coincidentally, according to One East Kentucky, the region has about twice the national average number of welders. This is understandable, as welders were key to keeping everything running smoothly in the metal and pressure-filled environment of coal mines.
The old infrastructure remains in place: substations, solid ground, cooling systems, and high-power hardware waiting to be restarted. "Perhaps facilities like data centers could be part of the solution," Kirk said.
So, when the panel discussion ended and entered the Q&A session, Kirk said he asked a question that had been lingering in his mind.
"You know, 50 or 60 years ago, a computer needed to occupy a space larger than my office, and now the phone in my pocket is more advanced than the computer that sent astronauts to the moon," he recalled his question, "Will these data centers always need to occupy buildings 30 to 40 feet high and millions of square feet? Or will we be left with a lot of underutilized warehouses or industrial building waste?"
He said the consultant did not provide a satisfactory answer. "The problem is here," Kirk said, "We know nothing about the future of such technology."
This uncertainty makes Nina McCoy uneasy. She was once a high school biology teacher in Inez. This coal town became famous when President Lyndon B. Johnson used it to gain support for his "War on Poverty" in 1964.
"This might sound terrible," she said, "but if they choose to build this thing here, it means it's a problem. We've lived here so long and have seen the pattern: people always dump what they don't want in places like this."
Her suspicion stems from a personal experience: In October 2000, a large coal slurry spill occurred upstream of the Coldwater Fork River at a coal mine site, polluting the river that ran behind her backyard, causing Inez residents to be unable to drink tap water for months.
"We downstream residents found out about this after some time, but the school system had to close for about a week until an alternative water source was found," she said.
To this day, many Inez residents still do not trust tap water.
So when McCoy hears the hype about AI, she seems to hear another voice: this is another promise that comes at a cost. "We allow these people to be called 'job creators'," she said, "Whether it's AI, cryptocurrency, or something else, we bow down to them and let them dictate our community because they are 'job creators'. But in fact, they are not job creators, but profit makers."
And profits always leave traces.
Artificial intelligence data centers require astonishing energy consumption, with a single ChatGPT search consuming up to 10 times the energy of a typical Google search, and generating high heat during operation. To maintain cooling, these facilities consume billions of gallons of water annually (note: 1 gallon = 3.79 liters), most of which evaporates. Residents are wary because they have previously suffered from other facilities' wastewater discharge issues, fearing these new facilities might impact fish survival and damage land, which are precisely what Kentucky residents want to protect.
Nevertheless, some locals still see the potential of artificial intelligence, even as a possible advancement.
"AI has already integrated into our lives," local entrepreneur Wes Hamilton said, who was involved in cryptocurrency mining in Kentucky during its peak, "Siri, ChatGPT, robots - everything you can think of relies on AI." He added, "Bitcoin was a one-time deal where only mining machine owners could profit."
Hamilton believes data centers could attract investors, engineers, and even companies willing to establish a long-term local presence. He says AI professionals worldwide will flock to Kentucky. Although he admits suffering significant losses in previous cryptocurrency projects, he insists this situation is different.
When Bitcoin first emerged, legislators offered generous tax breaks to attract miners: companies investing over $1 million could be exempt from hardware and electricity sales taxes. In March 2025, Kentucky Governor Andy Beshear went even further, signing the "Bitcoin Rights Act".
This legislation, portrayed as "defending personal financial freedom", aimed to ensure Kentucky residents' rights to use digital assets. The initial draft went further, attempting to prevent local governments from using zoning regulations to restrict cryptocurrency mining, a clause opposed by environmental organizations. The wording was ultimately weakened, but the core intent remained: digital resource extraction can continue to boom in Kentucky.
This is why we stand outside the mining facility in Compton, observing the semicircular metal structures in the woods. The mining site operates day and night, even on Sundays. Now, with Bitcoin prices fluctuating around $100,000, major miners discuss shifting towards AI, raising the question: Can Kentucky's Bitcoin mining make a comeback?
Mohawk's Bitcoin mining operations might even resurge. Anna Whites said they were originally scheduled to enter arbitration on May 12th. "I'm hopeful," she told us, "I really hope they sit down and say: 'This facility is great, let's just start it up.'"
