The New York Senate has passed a bill banning cryptocurrency mining in the state following a vote that took place today. As it is known, coins such as Bitcoin (BTC), Dogecoin (DOGE) and Ethereum (ETH) trying to switch to the proof-of-stake (PoS) process are created by mining. In other words, the bill in question affects these cryptocurrencies. Here are the details…
What will happen if the bill affecting Dogecoin, ETH is approved?
The bill now goes to Governor Kathy Hochul, who can veto or pass the bill. If approved, New York will be the first US state to ban crypto mining. The bill calls for a two-year fee on crypto mining in the state. As we have also reported on Kriptokoin.com, much of the authorities’ contention with mining stems from concerns about the environmental impact of mining.
The bill specifically calls for an end to mining operations that use a proof-of-work (PoW) consensus algorithm. This includes Bitcoin and major tokens like Ethereum, Dogecoin. Although Ethereum (ETH) is trying to move away from mining, namely PoW, with Ethereum 2.0, the transition to ETH 2.0 is not yet complete. When this update is done, the PoS algorithm will be used in the leading altcoin project.
Climate concerns trigger ban
The bill aims to lower the carbon footprint that New York’s supporters believe comes from polluted energy sources. But the bulk of New York’s electricity comes from nuclear and renewable sources. According to reports, mining in the state also takes place largely through the use of renewable energy sources. The bill was widely condemned by cryptocurrency groups, with organizations like the Blockchain Association launching a campaign against a ban.
Crypto advocates also fear that the bill could cause a domino effect in the country, with several other states enacting similar laws. The US currently has the largest share in the global hash rate, with around 38 percent. The bill passed by the state legislature will impose a moratorium, or a two-year delay, on PoW operations in New York that run on new carbon-based fuels. Barry Silbert, CEO of Digital Currency Group, tweeted:
This moratorium bill is a business killer and sends a terrible message to cryptocurrency entrepreneurs.
Is Texas the miners’ only chance?
As New York prepares to crash mining, companies flock to Texas. The state of Texas functions with cryptocurrency-friendly laws coupled with a more accessible power grid and plenty of renewable energy. As is known, several miners are already establishing facilities in the state. Argo Blockchain is building an approximately $2 billion facility in the state. Electric car maker Tesla is also establishing a mining site in Texas in partnership with Blockstream and Block. You can see some of the coins created with Proof of work (PoW) in the image below:
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