Two bitcoin miners have told Cointelegraph that If the bill banning proof-of-work (PoW) mining for two years in New York becomes law, it would end up causing an exodus of mining companies from the state and do little to address the moratorium’s intended goals.
GEM Mining CEO John Warren told Cointelegraph on Wednesday that he and other miners now view New York as an unfriendly place where they probably wouldn’t want to open a shop:
“The miners will not consider going there after the ban is part of the debate.”
Environmental sustainability has been at the core of the New York State government’s argument against proof-of-work mining. The controversial mining ban bill would ban any new mining operations in the state for the next two years. It would also deny license renewals to those already operating in the state unless they use 100% renewable energy.
GEM Mining recently commented that the bill will not only fall short of its intended goal, but also discourage new renewable-based miners from doing business in the state. Warren told Cointelegraph that his operation is already 97% carbon neutral.
“The regulatory environment in New York will not only halt their target…but will also likely discourage new, renewable-based miners from doing business with the state…”
The mining moratorium recently passed in NY. We shared our thoughts with @CNBChttps://t.co/2Trotc5bT3
— GEM Mining (@GEM_Mining) June 8, 2022
“New York’s regulatory environment will not only achieve its goal…it is also likely to discourage new renewable-based miners from doing business in the state…”
The mining moratorium was recently approved in NY. We share our thoughts with
GEM Mining is a South Carolina-based bitcoin (BTC) mining operation that contributes 1.92 Exahash per second (EH/s) of hashing power to the Bitcoin network as of May.
In the same way, the CEO of Sweden-based digital asset mining company White Rock Management, Andy Long, also sees bitcoin mining as “moving in the right direction towards using fossil-free energy,” as stated in email comments to Cointelegraph.
The company claims to be 100% reliant on hydropower for its hashing power input of 712 Petahash per second (PH/s).
Long echoed the idea that a ban on PoW mining “would not have the desired effect and sends the wrong message:”
“We want more states and local governments to encourage investment rather than stifle growth with prescriptive regulations that would likely be the thin end of the wedge.”
Roughly 10% of US hashing power comes from New York, according to the Cambridge Bitcoin Electricity Consumption Index (CBECI). This makes it the fourth largest producer in the country. In April, miners indicated in a survey with the Bitcoin Mining Council that about 58% of the energy used for mining comes from sustainable sources.
As New York goes, California goes
The bill, if it comes into force, could lead to an exit of mining companies from New York to other states, just as miners rushed out of China after its mining ban last year.
Nevertheless, Warren believes contributions from other states will continue to grow whether or not the moratorium goes into effect, adding that it probably wouldn’t cause a domino effect of other bans, except that “as New York goes, so goes Cali.”
He added that Even if Gov. Hochul signs the moratorium into law, “New York’s hashing power would still decline as Kentucky, North Carolina, Texas and other states add new incentives for miners:”
“What you’re seeing across the country is bipartisan support for mining and the jobs it provides. They also add stability to the power grid.”
Stand up to the competition
New York is already losing its competition to states like Kentucky and Georgia for miners. Georgia is the first state in the United States in terms of hashing power. Fortune reported in February that miners may be flocking there for the lower-than-average cost of electricity and the opportunity to offset their emissions with renewable credits. Georgia produces 35.6% of its electricity from nuclear and renewable sources.
Kentucky Governor Andy Beshear signed a tax incentive bill last March for bitcoin miners who set up shop and help support the state’s nascent renewable energy infrastructure. Kentucky has overtaken New York’s hashing power for third place in the union, but only produces 6.6% of its electricity from renewable sources.
The controversial mining bill is currently on the table of New York Governor Kathy Hochul, who has yet to publicly commit to signing the bill.. Instead, he has indicated that his team will study the proposal “very closely” in the coming months.
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