New York Lawmakers Advance Mining Moratorium Bill to Full Assembly

The bill would bar new permits for proof-of-work mining operations in former power plants for two years.

AccessTimeIconApr 25, 2022 at 8:19 p.m. UTC
Updated May 11, 2023 at 3:56 p.m. UTC
10 Years of Decentralizing the Future
May 29-31, 2024 - Austin, TexasThe biggest and most established global hub for everything crypto, blockchain and Web3.Register Now

New York lawmakers have advanced a controversial bill that aims to put a two-year moratorium on select proof-of-work crypto mining operations in the Empire State.

Members of the New York Assembly’s Ways and Means Committee considered the bill at a meeting on Monday afternoon, ultimately voting to send the bill to the floor for a vote by the full Assembly.

Despite widely circulating misunderstandings that the bill would ban all crypto mining in New York, the scope of the bill is fairly limited. If passed, it would place a two-year moratorium on the issuance of new permits for proof-of-work mining operations proposing the use of an “electric generating facility that utilizes a carbon-based fuel.”

The bill would also require a study by the New York State Department of Environmental Conservation on proof-of-work mining’s impact on the state’s ability to reach the ambitious climate goals set forth by the Climate Leadership and Community Protection Act, which mandates that New York’s greenhouse gas emissions be cut by 85% by 2050.

If passed, the bill could present a serious obstacle for mining operations like Greenidge Generation, which fired up a once-shuttered coal power plant in upstate New York and converted it to run on natural gas to power its bitcoin mining operation – the source of much controversy among both lawmakers and environmental groups.

Though Greenidge Generation’s existing operation wouldn't be affected by the bill because its permit application is already outstanding, it would be unable to expand its operations, and future mining operations hoping to replicate the Greenidge model wouldn't be allowed to do so.

The bill wouldn't affect existing proof-of-work mining operations or those that plan to use the state’s abundant – and cheap – sources of renewable energy. In some parts of New York state, where electricity is generated by the Niagara River and other sources of hydropower, crypto miners have found industrial power as cheap as 1.9 cents per kilowatt hour. The average cost in the U.S. was 7.26 cents per kilowatt hour, according to Statista.

An earlier version of the bill, which died in the state Assembly last year after facing resistance from the electrical workers’ union, originally called for a three-year moratorium on all crypto mining in the state.

Despite the narrower scope of this version of the bill, however, crypto advocates are concerned that its passage would pave the way for future legislation cracking down on crypto mining in New York and that those crackdowns could hurt the crypto industry across the state.

“A two-year mining ban sends a really bad message to the blockchain industry, to crypto companies, to Web 3 companies, that New York is saying ‘You’re not welcome here,'” said John Olsen, New York state lead at the Blockchain Association.

The full Assembly vote could take place as early as Thursday, according to sources familiar with the matter. If passed there, the bill will move to the state Senate.

UPDATE (April 26, 2022, 21:26 UTC): Links to bill.

Disclosure

Please note that our privacy policy, terms of use, cookies, and do not sell my personal information has been updated.

CoinDesk is an award-winning media outlet that covers the cryptocurrency industry. Its journalists abide by a strict set of editorial policies. In November 2023, CoinDesk was acquired by the Bullish group, owner of Bullish, a regulated, digital assets exchange. The Bullish group is majority-owned by Block.one; both companies have interests in a variety of blockchain and digital asset businesses and significant holdings of digital assets, including bitcoin. CoinDesk operates as an independent subsidiary with an editorial committee to protect journalistic independence. CoinDesk employees, including journalists, may receive options in the Bullish group as part of their compensation.

Cheyenne Ligon

Cheyenne Ligon is a CoinDesk news reporter with a focus on crypto regulation and policy. She has no significant crypto holdings.


Learn more about Consensus 2024, CoinDesk's longest-running and most influential event that brings together all sides of crypto, blockchain and Web3. Head to consensus.coindesk.com to register and buy your pass now.