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New York Bitcoin mining ban watered down to allow green projects

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New York State Senate Energy and Telecommunications Committee Chairman Kevin Parker has introduced a bill that proposes a moratorium on mining Bitcoin using electricity generated by burning fossil fuels in the state for a period of three years.

The bill, which went to the State Assembly, originally envisioned a ban on all mining in New York for up to three years. In the new version, the senators propose to impose restrictions only on new or planned expansion mining companies. So, on companies that are going to extract cryptocurrency using electricity from power plants running on fossil fuels.

At least one such facility, operated by Greenidge Generation, is located in upstate New York. However, it is already working, and, apparently, will fall under the exception in the bill.

Senators also abandoned the three-year suspension of activities. They limited the law to new projects and already operating centers that plan to increase the number of devices for mining at their facilities. In addition, the bill added a requirement to document the statewide environmental impact of mining companies. Any mention of cryptocurrencies is excluded from the final bill.

Also, the bill introduces a number of rules that mining farms must comply with. Only those facilities that comply with the Climate Leadership and Community Protection Act will receive work permits.

The reason for such actions was the negative impact of the actively developing industry for the extraction of digital assets in the state.

Bitcoin is not environmentally friendly

Bitcoin has been criticized for its electricity consumption, which is roughly equal to that of a small country.

The annual global energy use for proof-of-work mining is equivalent to that of Sweden. And exceeds that of all major tech companies such as Amazon, Google and Facebook.

As more miners move to New York and businesses look to expand, lawmakers said the increase in carbon dioxide emissions from mining could jeopardize the state’s efforts to cut emissions. In addition, the use of water by miners to cool equipment can cause damage to aquatic organisms. Due to the increase in water temperature in local lakes.

While Bitcoin proponents argue that the costs are worth it; and can be generated using clean energy that doesn’t emit carbon into the atmosphere. Many detractors believe that Bitcoin creates a demand for more energy, that can only partially met by renewable energy sources.

As a reminder, the Central Bank of Turkey recently prepared a report on current regulatory initiatives. In which it first raised concerns about the impact of Bitcoin on the environment.

Senator from the US proposed an alternative to the introduction of a ban on mining in New York

According to US Senator Kevin Parker, mining of digital assets in the state shouldn’t contradict the eco-initiatives of local authorities.

He believes that local regulators should start exploring the possibilities of using renewable energy sources in the mining industry.

The senator noted that the transfer of the mining industry to renewable energy sources could be a compromise. Compromise between the authorities’ attempts to preserve the environment and the desire of the crypto industry participants to continue making money on the extraction of digital assets.