In what can only be considered a landmark decision related to mining, New York has enforced a ban on Proof of Work mining operations. The New York Bitcoin Mining ban poses a big question about the future of the Proof of Work mechanism, which many consider the most decentralized way to mine crypto. In this article, we cover everything you should know about this new bill.
Bitcoin mining has been an eyesore for many authorities. The first issue was the unfettered nature of the cryptocurrency, which they feared would undermine the traditional institutions. And while that is getting resolved due to rising calls to introduce regulations, another issue has persisted, the high energy consumption.
The latter part of the issue has been a major point of debate among New York Authorities. On May 26th 2022, the New York State Assembly passed the Bitcoin Morning Moratorium. Even though the bill was passed, several legislators were still undecided.
However, On June 3rd 2022, the lawmakers decided to pass the bill to ban those bitcoin mining operations that use non-renewable energy resources.
New York To become the First US State to Ban a Blockchain Technology Infrastructure
The passed bill has been forwarded to Governor Kathy Hochul. The fate of the mining operations in the state of New York rests on her signature, as she can decide whether to veto or sign it.
Suppose the governor signs the bill, which many experts say she would. In that case, New York will become the first state in the United States of America to ban a critical blockchain technology infrastructure.
What Does the Bill Contain?
The bill is pushing for a two-year moratorium on the mining operations that use Proof of Work authentication methods.
Bitcoin mining using the Proof of Work Mechanism would be banned during this period.
Proof of Work has drawn the ire of many authorities and climate change activists over the years because of its high energy consumption rate.
This approval is even more significant because it managed to get the support of those senators who were indecisive about the proposal.
The New York Bitcoin Mining Ban is not for Every Mining Operation
While the news has created discomfort across the entire crypto community, the mining will only affect those using non-renewable sources of energy. Curbing the state’s power footprint was, in fact, the primary reason behind many lawmakers backing this bill.
Even though this news is positive to many people, it has not done enough for the new law to draw criticism from many in the blockchain industry.
The New York Bitcoin Mining Ban is a Big SetBack – Perianne Boring
One of the most critical voices against this bill comes from the president of the Chamber of Digital Commerce, Perainne Boring.
The Chamber of Digital Commerce is the world’s largest trade association that represents the blockchain technology industry.
Boring said that this law would create a domino effect across the whole country, leaving many jobless.
“It will also lead to a domino effect across the country, and many states will likely join in and copy this approach.”, he further continues.
It is to note that demand for jobs within the blockchain industry has increased over the past year, and there are ample opportunities to go around. People generally make somewhere between $80,000 to over $100,000 in this industry.
And it is not just those working within the industry that will be affected by this. According to industry advocates, the ban will greatly impact many local construction workers, engineers, electricians, and other local vendors.
Other Bitcoin mining company leaders have also chimed in and have said that the move will discourage the emergence of those who want to use greener solutions to mine crypto.
John Warren, the CEO of the institutional-grade bitcoin mining company GEM MINING, said, “The new will discourage renewable-based miners from doing business with the state due to the possibility of more regulatory creep.”
“This move is basically the state of New York pushing crypto mining, jobs and tax dollars out to other states.” – said Warren.
Twitter Crypto Experts are Butting Heads with each other
Upon coming across the news, we wanted to check out Twitter reactions, and they did not disappoint.
It becomes clear from reading the tweets that most against it are those who’ve been bullish about bitcoin from the very beginning. None of them is concerned that the ban affects only those miners who’re using non-renewable energy sources. In their eyes, any prohibition against any kind of crypto mining operation is not a move that miners appreciate.
Twitter critics have taken a tribal approach to this. Some users have taken a particularly negative stance towards this, saying that New York has removed itself from the 21st century.
By attempting to ban #Bitcoin mining New York has removed itself from the 21st century digital economy.
— McShane (@mcshane_writes) June 3, 2022
These claims are supported by users such as David, who has gone as far as saying that the Bitcoin ban will turn New York from being a representative of the new world capital to an ancient city.
a city that was representative of a new world capital, now is just a burnt ancient city?#bitcoin is future, if you’re against it, it means you didn’t walk with the rest of us on “darwins famous revolution picture”
if you know what im saying?— David William (@just_david___) June 3, 2022
Others have supported this decision. They’ve said that more energy consumption takes away the profits from mining operations.
Losing energy for an old Bitcoin technology is not a right decision, there are things that are more important than Bitcoin,There is also an alternative to it, of course, that can achieve decentralization
— abdo kadri (@kadri__abdo) June 3, 2022
In another news, a popular crypto magazine reported that while New York has banned mining, the Texas government is engaged with mining operations.
On April 27th, Fort Worth, Texas, became the first city in the US to house bitcoin mining rigs. The state decided to host mining operations on a private network to address the security risk of three machines. They are as small as toaster ovens and consume as much energy as a household vacuum cleaner.
The Ban will Likely Affect All Miners
According to US Energy Information Administration, 60% of New York’s energy comes from renewable sources and nuclear power. It is most likely that most Bitcoin miners in the state are not relying on fossil fuels to run their mining operations.
Many experts, including the CEO of Microstrategy, have stated that the state has deliberately misrepresented the energy consumed by mining.
Biden administration is in the works of creating a policy that targets bitcoin mining to deal with high energy consumption and emission.
The White House Office of Science and Technology Policy is currently in the process of examining a relationship between energy transitions and blockchain technology. It aims to determine if blockchain technology can advance sustainable development, or can cause obstruction.
The end goal seems to be to clamp down on proof of work mining operations for the environment’s sake. With this decision, it is likely that the US might lose its position as the world’s leading Bitcoin miner.
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Source: https://insidebitcoins.com/news/new-york-bitcoin-mining-ban-everything-you-need-to-know