The bill will now move with support to the State Senate for approval before Governor Hochul signs it into law.
The New York State Assembly passed a bill late Tuesday that would ban for two years all new Proof-of-work (PoW) cryptocurrency mining facilities in the state that use a carbon-based fuel for their operations.
The bill, sponsored by Anna Kelles, would not only impose a two-year suspension on the approval of any new Bitcoin mining company, but the proposed moratorium would also prevent the renewal of permits issued to existing PoW cryptocurrency miners that use carbon-based energy if they try to increase the amount of electricity consumed.
Kelles posted on Twitter that she was, “thrilled that my bill with Senate champion @kevinparkernyc A7389C/S6486D just passed in the Assembly as part of the #EarthDay Package! Thank you to all of cosponsors and advocates who helped get this bill to the floor for a vote!”
Passing of the Ban: opposing views
The bill rallied enough support to pass, with 95 in favor and 52 against, and now Senator Kevin Parker will bring it up for a vote in the State Senate. If successful, Governor Kathy Hochul will receive it, who can either veto the bill or sign it into law.
The Department of Environmental Conservation (DEC) would be charged, under the bill, with preparing a “generic environmental impact statement” to number, locate, and assess the energy consumption and greenhouse gas emissions of PoW miners and their impact on public health.
Cryptocurrency industry advocacy group the Blockchain Association had earlier called on “pro-tech, pro-innovation, pro-cryptocurrency” New York residents to oppose the bill, which, according to them, gave rise to thousands of messages directed at legislators.
The association said there was about three hours of debate on the bill, showing what they believe is “greater opposition to the mining ban than proponents believed.” In a tweet on Wednesday, the team said it would direct its energy to the New York Senate to kill what it calls the “anti-tech bill.”
Proposals to ban proof-of-work cryptocurrencies for environmental reasons are becoming more common. A similar proposal called the Markets in Crypto Assets Bill (MiCA) was narrowly defeated in the European Parliament at the end of March, with lawmakers there even considering banning Bitcoin trading to enforce the mining ban proposal.
As the Story Unfolds: Moratorium on Bitcoin Mining in New York Approved
In a 95-52 victory, the New York State Assembly has voted to pass legislation establishing a two-year moratorium on Bitcoin mining.
The bill will now go to the State Senate for a new round of voting.
Although the bill does not propose an outright ban on cryptocurrency mining, it will prevent mining companies from renewing their mining permits if fossil fuels power those operations. According to the bill, this also means that no new permits will be approved either.
“The Department of Public Utilities will not approve a new application or issue a new permit … for an electric generation facility that uses a carbon-based fuel and that provides, in whole or in part, electric power behind the meter consumed or used by cryptocurrency mining operations that use proof-of-work authentication methods to validate Blockchain transactions,” it read.
“Behind the meter” is a term that describes energy used on-site. A common type of behind-the-meter system is a residential solar system: solar panels on the roof generate electricity, fed into the home below for use. It is in contrast to “in front of the meter” which feeds an off-site location. An example of this is a utility power plant, whose power goes over a wide area for use by electricity consumers. “Proof-of-work authentication methods” refers to the mechanism a Blockchain uses to confirm various operations, from simple transactions to forging an NFT.
Currently, Bitcoin and Ethereum are the largest proof-of-work (PoW) networks of cryptocurrencies. However, Ethereum is likely to switch to a greener mechanism called proof-of-stake (PoS) in the third quarter of this year, with the highly anticipated Ethereum 2.0 upgrade.
By Audy Castaneda
