New York seeks to ban bitcoin mining over power consumption

Proposed bill places a three-year moratorium on power-hungry crypto mining operations

Two Bitcoins in a person's hands

New York lawmakers have submitted a bill banning cryptocurrency mining operations for three years.

Introduced on Monday, bill S6486 seeks to put a moratorium on the operation of cryptocurrency mining centers unless they undergo a full environmental impact statement review. The review would have to prove that a mining center doesn't affect the state’s greenhouse gas emission targets.

"Cryptocurrency mining centers are an expanding industry in the State of New York, often, but not exclusively, located in retired or converted fossil fuel power stations, including dormant power plants," the bill said.

As part of its Climate Leadership and Community Protection Act, the state has called for a 40% reduction in greenhouse gas emissions over 1990 levels by 2030. That rises to 85% and net-zero emissions in all sectors of its economy by 2050.

The cryptocurrency mining bill added, "The continued and expanded operation of cryptocurrency mining centers will greatly increase the amount of energy usage in the State of New York, and it is reasonable to believe the associated greenhouse gas emissions will irreparably harm compliance with the Climate Leadership and Community Protection Act in contravention of state law."

The bill applies to existing and proposed mining operations. In addition to a cumulative impact assessment on greenhouse gas emissions, it would also include a review of any impacts on water or air quality, or wildlife. Reviews would include a 120-day public comment period.

Bitcoin has had a considerable impact on energy consumption. Its consensus algorithm relies on a process called proof of work, in which miners compete for the chance to include transactions in a block on the chain. To do so, they compete to solve a complex mathematical problem. The bitcoin protocol seeks to regulate the production of blocks to one every 10 minutes. To do that, it must make the mathematical problem more difficult as more miners join the network, adding more computing power.

Proof of work forces the total computational power on the network upward as bitcoin becomes more popular. The cryptocurrency has seen its price soar recently, forcing the hash rate up

Related Resource

IT Pro 20/20: Understanding our complicated relationship with AI

The 16th issue of IT Pro 20/20 looks at the very human problems associated with artificial intelligence

IT Pro 20/20: Understanding our complicated relationship with AIDOWNLOAD NOW

According to the Bitcoin Energy Consumption Index, it takes 1138 kWh of energy to process a single bitcoin transaction at the time of writing, which equates to the energy required to run a single US household for 39 days. The bitcoin network uses roughly the same amount of energy as the Netherlands each year.

While the core bitcoin developers seem committed to proof of work, competing network Ethereum, which offers additional functionality, is preparing to transition to an alternative proof-of-stake mechanism. This approach replaces miners with validators chosen to mine each block, dramatically reducing energy use compared to proof of work.

Featured Resources

Consumer choice and the payment experience

A software provider's guide to getting, growing, and keeping customers

Download now

Prevent fraud and phishing attacks with DMARC

How to use domain-based message authentication, reporting, and conformance for email security

Download now

Business in the new economy landscape

How we coped with 2020 and looking ahead to a brighter 2021

Download now

How to increase cyber resilience within your organisation

Cyber resilience for dummies

Download now

Recommended

Crypto-mining hackers hit Kubernetes clusters
cryptocurrencies

Crypto-mining hackers hit Kubernetes clusters

10 Jun 2021
Square and Blockstream to build a solar Bitcoin mining facility
cryptocurrencies

Square and Blockstream to build a solar Bitcoin mining facility

7 Jun 2021
What are altcoins and how do they work?
cryptocurrencies

What are altcoins and how do they work?

21 May 2021
Regtech and the elimination of paper
compliance

Regtech and the elimination of paper

20 May 2021

Most Popular

Best paying tech jobs of 2021
Careers & training

Best paying tech jobs of 2021

7 Jun 2021
Ten-year-old iOS 4 recreated as an iPhone app
iOS

Ten-year-old iOS 4 recreated as an iPhone app

10 Jun 2021
Mythic launches power-sipping AI chip
Hardware

Mythic launches power-sipping AI chip

8 Jun 2021