New York Passes Bill To Prohibit Bitcoin Mining For The Next Two Years - Here's Why It Matters

Senate members in New York have passed a landmark bill that puts a stop to new permits granted for mining cryptocurrencies at plants powered by fossil fuels. The Senate's measure squarely targets proof-of-work authenticated mining, a system for mining cryptocurrencies that is extremely energy-hungry and currently forms the backbone of Bitcoin and Ethereum ecosystems. Just to be clear, the bill doesn't affect cryptocurrency transactions carried out in the state.

The bill seeks a two-year moratorium on any new permits granted to bitcoin mining facilities that involve fossil fuel consumption. According to a statement released by the Office of Senator Kevin S. Parker, the bill ensure that the "state pauses the dirty practice of refiring retired fossil fuel power plants for crypto mining." It will now be forwarded to the Governor whose signature will officially turn it into a legally binding article that will be enforced across the state of New York.

The bill has been passed over growing environmental concerns and has also commissioned a study that will assess the true climate impact of cryptocurrency mining in the state. The study will check the compliance of these cryptomining facilities with the state's Climate Leadership and Community Protection Act. Senate members voting in favor of the bill are of the opinion that retired power plants should not be revived to guzzle fossil fuel for cryptomining and jeopardize the state's landmark climate law.

The primary concern for the state, as highlighted by Senator Parker, is that fossil fuel-intensive cryptomining operations will shoot up the carbon footprint and derail the state's environmental efforts currently in progress. The state of New York has lately become a hot favorite for cryptominers, thanks to cheap hydroelectric powers and coal power plants that lay unused, ready to be repurposed into mining hubs.

Proponents of the cryptocurrency industry claim that the practice will boost the state's economy, but environmental activists and even locals have flagged serious concerns. According to a report from Politico, the majority of mining plants in New York source power from the state's main grid, while one of the proposed mining stations will suck up 110 megawatts — enough juice to power 80,000 homes — by the end of the year 2022. 

Environmental concerns are not unfounded. A report from Technology Review documented the adverse effects that Bitcoin mining had on the district of Plattsburgh in New York. Aside from producing a ton of heat that forces the dumping of hot water in the natural water reservoirs, the mining hardware also irked neighbors with the high-frequency whirring than even managed to vibrate the dwelling places of the residents nearby. Per the report, cryptomining operations have also shot up the annual electricity bill of residents in just a couple of years.