Industry participants call New York mining moratorium ineffective

A ban on mining in New York state will push crypto-mining businesses out of the state and will do little to achieve the moratorium’s stated goals. That view was shared with Cointelegraph by industry participants.

In early June, the New York Senate approved a two-year moratorium on cryptocurrency mining using energy generated from carbon sources. The lower chamber passed the measure in late April.

The key arguments for the sponsors were environmental sustainability. Existing companies or those pursuing permits for mining digital assets will be able to continue operating. During the two-year period authorities plan to study the potential environmental impact of mining on the Proof-of-Work (PoW) on the environment.

GEM Mining CEO John Warren said that he and his colleagues now view the state as an unfriendly jurisdiction for business.

“Miners won’t even consider moving there, now that the ban has become part of the discussion,” he said.

According to him, the bill will not only fail to achieve the stated goals but will deter even those who mine cryptocurrencies using renewable energy from doing business in the state. GEM Mining’s operations are 97% carbon-neutral, he added.

White Rock Management CEO Andy Long also said that the PoW mining moratorium “will not have the intended effect and will send the wrong signal.”

“We want more states and local authorities to encourage innovation rather than stifle growth with prescriptive rules that are likely to be the first step [toward a ban],” he noted.

According to Warren, regardless of the passage of the disputed bill, New York’s share of the overall hash rate of the leading cryptocurrency’s network among countries will decline in favor of Kentucky, North Carolina, Texas and other states, as authorities there introduce new incentives for miners.

According to data from CCAF, in December 2021 New York accounted for less than 10% of the United States’ total hashrate. Georgia led with 30.8%.

In July 2021 the United States took the top spot in the share of the leading cryptocurrency’s network hashrate among countries and continues to dominate.

The PoW mining moratorium bill is awaiting signature by New York Governor Kathy Hochul. She said her team will study the proposal very thoroughly over the coming months.

As noted, Ethereum founder Vitalik Buterin joined in criticizing the bill.