Over the weekend, HEATED reported on one of the stranger bedfellowships of the 2024 election: Elon Musk, clean tech billionaire, and Joe Craft, coal billionaire.

ICYMI: Craft is one of the largest donors to Elon Musk’s America PAC. The coal baron made a one-time $1 million donation in June, marking his single-largest-ever campaign contribution.

That Craft would fork over $1 million to a pro-Trump effort is not surprising. What’s surprising is that the money would go to Musk, who once helped South Australia quit coal, and whose business plan for Tesla literally proposes to “eliminate fossil fuels.”

So why would Craft throw his weight behind Musk, of all people? My theory is that it has less to do with Musk’s vision for the future of energy, and more so his vision for the future of cryptocurrency.

Because Craft, like Musk, is a certified crypto bro. And if cryptocurrency soars in the near-term future, then Craft is betting that coal will, too.

The coal company mining Bitcoin

Cryptocurrency mining requires an enormous amount of electricity—so much that in 2020, a coal plant slated for retirement was revived because of Bitcoin mining. This has been great news for Craft’s coal company, Alliance Resource Partners.

In an April earnings call, Craft said that cryptocurrency and artificial intelligence is “driving significant growth in anticipated electricity demand over the next several years.” This increase in demand has “given us some more optimism that our coal operations will continue longer than when we started looking at some of this diversification,” Craft said. 

And Craft isn’t just waiting for Bitcoin miners to create demand for coal. He’s creating the demand himself. Over the last four years, Alliance Resource Partners has mined a whopping $30 million worth of Bitcoin, Alliance CFO Cary Marshall said on the April earnings call. “We're not actually out there buying Bitcoin or anything of that nature,” Marshall said. “We're mining the Bitcoin associated with these miners that we have.

Craft went on to explain that Alliance has "effectively built” a data center for Bitcoin mining, and is using the excess electricity from its coal facilities to power the energy-intensive Bitcoin mining process. 

In addition, Craft said Alliance is renting its excess data processing capacity to other Bitcoin miners, “to take advantage of the low energy costs we have.”

The extra income from Alliance’s Bitcoin mining operations are helping the coal company remain financially stable, Marshall added. “We're mining the Bitcoin, and we're selling generally on a monthly basis to cover our operating costs,” he said. He added that the company currently owns about 425 Bitcoin and expects to mine between 175 to 190 more this year.

Meanwhile, Forbes has called Musk “one of the biggest Bitcoin and crypto price influencers”—which could extend to the government level if Trump is re-elected. If re-elected, Trump has promised to appoint Musk the head of a new department to oversee and mitigate government spending: The Department of Government Efficiency, or DOGE—a reference to Musk’s favorite cryptocurrency, Dogecoin. (Trump has also pledged to create a bitcoin strategic reserve if elected, as well as form a crypto advisory council).

Musk, for what it’s worth, used to be concerned about the potential negative impacts of cryptocurrency on climate change, particularly with regard to coal. In 2021, just weeks after Tesla announced it had invested $1.5 billion in Bitcoin, Musk announced that Tesla would no longer accept car purchases via Bitcoin. "We are concerned about rapidly increasing use of fossil fuels for Bitcoin mining and transactions, especially coal, which has the worst emissions of any fuel," he said. "Cryptocurrency is a good idea... but this cannot come at great cost to the environment."

But like all things related to climate change, Musk seems to have abandoned that concern. Today, Tesla is the third-largest Bitcoin holder among public companies, Yahoo reported, and SpaceX “is said to be holding around 8,285 coins.”

Anyway, just thought that was interesting. What do y’all think?

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