New York might become the first-ever U.S. state to impose a ban on cryptocurrency mining due to environmental concerns. However, crypto analysts and enthusiasts think that the carbon footprint of Bitcoin (BTC) mining is heavily overestimated.
Bitcoin (BTC) mining in New York might be on borrowed time
According to CNBC's MacKenzie Sigalos, the New York State Senate approved a bill that includes a two-year ban on certain cryptocurrency Proof-of-Work (PoW) mining operations.
So NY is now regulating the contents of the data center and has banned a kind of computation (sha-256 hash functions). They’re directly controlling what constitutes a valid use of power https://t.co/YQxxVUazVf— nic carter (@nic__carter) June 3, 2022
Should it be signed by Governor Kathy Hochul, it would prevent crypto mining companies from renewing existing mining gear and adding new rigs unless they use 100% renewable energy. Also, a two-year moratorium would be imposed on the launch of new crypto mining farms.
As per the lawmakers, this would reduce the dependence of New York's economy on power plants that burn fossil fuels and, therefore, curb aggregated carbon emissions.
This initiative is aligned with the Climate Leadership and Community Protection Act that requires New York State to cut greenhouse gas emissions by 85% by 2050.
Another crypto miner exodus?
CNBC highlights that heavyweight cryptocurrency entrepreneurs and some experts have already criticized the possible ban on Bitcoin (BTC) mining. Perianne Boring, founder and president of the Chamber of Digital Commerce, claims that it would be dangerous for the economy of the U.S. as a whole:
This is a significant setback for the state and will stifle its future as a leader in technology and global financial services. More importantly, this decision will eliminate critical union jobs and further disenfranchise financial access to the many underbanked populations living in the Empire State.
As covered by U.Today previously, the U.S. was the top destination of mining businesses' migration amid the Chinese crackdown on cryptocurrencies.
As New York would be the first state to impose such draconian anti-Bitcoin measures, it might set a "bad precedent" for other states and territories, Galaxy Digital's Amando Fabiano told CNBC.
Also, industry insiders are warning about "the domino effect" that a U.S. ban on mining will definitely increase unemployment rates.