New York Bill Casts Uncertainty on the Future of Bitcoin Mining
Unacceptable Carbon Footprint
A New York bill banning certain Bitcoin (BTC) mining practices has passed and now requires the approval of Governor Kathy Hochul to become law. At issue is “proof of work” cryptocurrency mining that uses a significant amount of electricity to run mining operations, all while burning fossil-fuels as part of the process. If Hochul signs the bill it would mark the first such ban on blockchain technology infrastructure in the US.
The measure also connects to New York’s state goal of cutting greenhouse emissions by 85% by 2050 in compliance with the Climate Leadership and Community Protection Act.
The bill would only allow proof-of-work mining companies that use 100% renewable energy to expand or renew permits. The Chamber of Digital Commerce notes that members that mine in New York have an 80% sustainable energy mix, which does exceed the estimated global average of 60%. The bill’s opponents contend that crypto miners will leave New York and relocate to other states that have fewer hurdles to their operations, thereby harming the state’s economy.
Others fear New York’s move could become a trend that catches on with other states, with implications for both the industry and the Americans it employs.
Washington Evaluates Environmental Impact
The crypto industry could also be facing headwinds at the federal level. The Biden administration is evaluating Bitcoin mining’s environmental impact as part of a broader effort to limit emissions and address factors contributing to adverse climate change.
Given the US accounts for nearly 40% of the global Bitcoin mining industry, what is decided in New York could be pivotal to the industry, especially if new restrictions establish a standard other states choose to follow.
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