BITCOIN MINING BAN: Domino effect across the US?

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BITCOIN MINING BAN: Domino effect across the US?

Deputies in the parliament of the American state of New York voted to ban new bitcoin mining operations, reports CNBC from Albania, the capital of that country. This act was sent to Governor Katie Hochul, who can sign it in order to have the force of law or she can veto it.

If it signs the document, New York would become the first country in the United States to ban blockchain technology infrastructure, says Perian Boring, founder and president of the Chamber of Digital Commerce. Insiders from this industry also told CNBC that this could have a domino effect across the United States, which is currently at the forefront of the global bitcoin mining industry with a share of 38 percent of global participants in crypto mining.

The New York law, which was previously debated in the Assembly in late April before being sent to the Senate, calls for a two-year moratorium on certain cryptocurrency mining operations that use authentication methods to validate blockchain transactions to verify mining.

Proof-of-work mining, which requires sophisticated equipment and a lot of electricity, is used to create bitcoin. Ethereum will move to a less energy-intensive process, but it will use this method of authentication for at least a few more months, according to the American media.

“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,” Boring tells CNBC.

The irony of banning bitcoin mining

One section of the bill involves conducting a statewide study of the environmental impact of proof-of-work mining operations on New York’s ability to reach aggressive climate goals set under the Climate Leadership and Community Protection Act, which requires New York’s greenhouse gas emissions be cut by 85% by 2050.

Boring tells CNBC the recent swell of support in favor of this year’s proposed ban has a whole lot to do with this mandate to transition to sustainable energy. “Proof-of-work mining has the potential to lead the global transition to more sustainable energy,” Boring told CNBC’s Crypto World, pointing to the irony of the moratorium. “The bitcoin mining industry is actually leading in terms of compliance with that Act”.