A bill restricting the granting of crypto mining permits on environmental grounds has passed the New York State Senate. The bill, sponsored by Democratic Senator Kevin Parker, passed by a 36-27 vote margin and now heads to the democratic-controlled State Assembly.

Fast Facts:

  • The bill updates the state’s existing Environmental Conservation Law to prohibit any new mining permits to operate within an “electric generating facility that utilizes a carbon-based fuel” while limiting exiting operations at their current levels of energy use.
  • The bill applies to any cryptocurrency, such as Bitcoin, that uses a proof-of-work consensus model, which relies on large amounts of computing power to validate transactions on the blockchain before new tokens can be created.
  • Authors of the bill were concerned about the growing practice of repurposing old power plants to be converted into mining operations. One such operation, Greenidge Generations — established in a former coal-fired power plant — has responded to such concerns by purchasing carbon offset credits as of June 1 this year.
  • Environmental concerns over coal-powered Bitcoin mining also recently prompted China’s Inner Mongolia province — formerly one of the world’s biggest producers of Bitcoin — to ban crypto mining altogether.