NY Could Declare a Moratorium on Bitcoin Mining Operations

The New York Senate has passed a bill that would establish a moratorium on Bitcoin mining operations that rely on fossil fuels to generate the electricity required to run their rigs.

Assembly Bill A7389C(Opens in a new window) was introduced in May 2021; it was passed on June 2. The summary of the bill states that it “establishes a moratorium on cryptocurrency mining operations that use proof-of-work authentication methods to validate blockchain transactions” and “provides that such operations shall be subject to a full generic environmental impact statement review.”

That moratorium would prohibit New York from issuing new permits—or renewing existing permits—to electric companies that use fossil fuels and mine cryptocurrencies that rely on proof-of-work authentication methods. (CNBC reports(Opens in a new window) that operations powered entirely by renewable energy wouldn’t be affected.) The moratorium ends two years after the bill goes into effect.

The bill also requires the Department of Environmental Conservation to prepare a report on how much energy these mining operations consume, from where that energy is derived, and how that could affect New York’s environmental goals; the impact mining could have on emissions, water quality, and public health; and the industry’s potential “social and economic costs and benefits.”

A.B. A7389C will now be sent to Gov. Kathy Hochul for review. If she signs the bill, New York would become the first state to limit cryptocurrency mining for fear of its environmental impact.