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New York Passes Bill Halting New Bitcoin Mining Projects

( Epoch Times )

The New York State Senate passed a bill early Friday that seeks to ban new cryptocurrency mining projects in a bid to tackle some of the environmental issues associated with the use of proof-of-work authentication methods to validate blockchain transactions, such as bitcoin.

The bill, which still needs Gov. Kathy Hochul’s signature to become law, passed the New York State Senate by a vote of 36–27.

The measure would impose a 2-year moratorium on new proof-of-work mining projects in New York that are powered by fossil fuels.

The 2-year freeze is to allow authorities to carry out an environmental impact assessment of crypto mining operations that use non-renewable sources of energy like gas or coal, including around electricity consumption and potential water quality effects.

The text of the legislation (pdf) justifies the freeze by citing the need to protect the environment and fight climate change.

“The continued and expanded operation of cryptocurrency mining operations running proof-of-work authentication methods to validate blockchain transactions will greatly increase the amount of energy usage in the state of New York, and impact compliance with the Climate Leadership and Community Protection Act,” the text of the bill reads.

The Climate Leadership and Community Protection Act requires that statewide greenhouse gas emissions be cut 85 percent by 2050 and that the state has net-zero emissions in all sectors of the economy by that point.

The legislation features a carveout for existing crypto mining operations, as well as for miners that are in the process of renewing their permits.

If it becomes law, the measure would make New York the first state in the country to ban proof-of-work mining.

The bill has faced opposition from the crypto industry and others.

John Olsen, a lobbyist with the Bitcoin Association, told CoinDesk in May that he feared the moratorium could be expanded into a full ban.

The Chamber of Digital Commerce has spoken out against the legislation, saying in a statement that it would “establish a dangerous precedent” for other states.

“The proposed moratorium would have many negative consequences for the digital asset industry and its future. Not only would it significantly hinder New York’s innovation economy, but also it would eliminate important green jobs, many of which are filled by Union employees,” the Chamber said.

The Chamber of Digital Commerce also said the mining freeze would not help New York State meet its energy use and carbon emission aims as “digital asset mining uses an inconsequential amount of energy,” while arguing that the legislation is “more likely to drive green energy investments out of the state.”

The Chamber also argued that it’s in America’s national security interest to encourage domestically-hosted digital mining.

“It’s essential that blockchain infrastructure is hosted in the U.S.,” the Chamber said, adding that it supports a separate bill that seeks to establish a task force to better understand blockchain technology and its impacts.

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