A bill seeking to suspend cryptocurrency mining in the state of New York on environmental grounds is currently under review.
Tabled by Democrat senator Kevin Parker, the bill seeks to establish a three-year moratorium on crypto mining, with the goal of preventing irreparable damage to the state’s sustainability ambitions.
The bill was referred to the Committee on Environmental Conservation on May 03 and, if passed, will require crypto miners to undergo an environmental impact review if they are to continue to operate.
“Cryptocurrency mining centers are an expanding industry in the State of New York, often, but not exclusively, located in retired or converted fossil fuel power stations,” the bill explains.
“The continued and expanded operation of cryptocurrency mining centers will greatly increase the amount of energy usage in the State of New York and it is reasonable to believe the associated greenhouse gas emissions will irreparably harm compliance with the Climate Leadership and Community Protection Act.”
Impact of crypto mining
The recent surge in the price of cryptocurrencies has placed mining practices under the spotlight. One of the most common grievances with Bitcoin mining in particular has to do with the toll it takes on the environment.
Under the proof-of-work (PoW) system applied by Bitcoin and others like it, mining operations compete to solve complex mathematical problems. The first to do so earns the right to process a block of transactions, in exchange for transaction fees and newly minted cryptocurrency.
Although this system is crucial to maintaining and securing the Bitcoin network, the amount of energy used up by competing miners is astronomical. A recent report from the University of Cambridge claims that Bitcoin uses up more energy on an annual basis than the country of Sweden, at 141.91 TWh/year.
“A single cryptocurrency transaction uses the same amount of energy that an average American household uses in one month,” notes the bill.
According to the document, the temporary mining ban would help New York ensure it reaches its various environmental targets, which include 70% renewable energy by 2030 and 100% zero-emission electricity by 2040.
Although the bill has received support from only a few senators so far, the Democrats have a majority in both the lower house and senate.
Although the crypto mining ban would extend only as far as the New York border, the bill could have wider ramifications for the industry, by setting a precedent that other states may choose to follow.
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