New York lawmakers pass first-in-nation cryptocurrency moratorium – POLITICO

New York
The measure exempts operations that have already secured or applied for new or renewed air permits and the bulk of facilities in New York that rely on power from the electric grid.
Upstate New York has become an attractive destination for companies that “mine” digital currencies including Bitcoin. | Marco BelloGetty Images
By Marie J. French

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ALBANY, N.Y. — The New York Legislature early Friday approved a two-year, limited moratorium on digital currency mining at fossil fuel power plants.
The Senate, after a last-ditch push by environmental advocates, voted on a Assembly measure to have the first-in-the-nation partial ban in the final hours of the legislative session. The bill, which is vociferously opposed by the cryptocurrency industry, is narrowly targeted at proof-of-work mining that utilizes behind-the-meter electricity from fossil fuel plants.
Upstate New York has become an attractive destination for companies that “mine” digital currencies including Bitcoin, because of the availability of former power plants and manufacturing sites with unused electrical infrastructure.
The measure exempts operations that have already secured or applied for new or renewed air permits and the bulk of facilities in New York that rely on power from the electric grid. Still, supporters who pushed aggressively see it as an important step to avoid increased emissions from the industry restarting old power plants.
“The New York Senate has stood up for New Yorkers and our landmark climate law with the passage of this crucial bill to address cryptomining in fossil fuel power plants,” said Liz Moran, New York policy advocate for Earthjustice in a statement. “With this bill’s passage, the legislature has rightly said fossil fuel power plants can’t get a second life in New York just for private industry gain, which would fly on the face of the state’s climate mandates.”
The bill would also require a study of the industry and its environmental impacts by the Department of Environmental Conservation. The cryptocurrency industry and business groups pushed back hard on the measure, arguing it would have a chilling effect and misrepresenting it as a wholesale ban on mining digital currencies.
The sponsor of the bill, Sen. Kevin Parker (D-Brooklyn), had given up hope of passing the measure on Wednesday. Legislative officials indicated there were enough votes to pass but that leadership was leery of bringing the bill forward.
Some lawmakers, particularly those with cryptocurrency and blockchain companies in their districts, raised concerns about the impact of the moratorium. The industry has warned the bill will chill investment in the state.
“The message won’t be about the details… It’ll be about an emerging industry New York is saying no to,” said Sen. Jeremy Cooney (D-Rochester), whose district encompasses the headquarter of Foundry, a digital currency industry company that has lobbied extensively against the moratorium. “Every job matters for me in Rochester.”
The Senate passed a broader moratorium last year, and the measure was revived after a concerted push by environmental groups and other supporters.
The battle over the bill will now move to Gov. Kathy Hochul’s desk. The governor has not staked out a position and has punted on a renewed permit for an existing gas-powered cryptocurrency mining operation in the Finger Lakes region that spurred the push for the bill.
“This is a significant setback for the state and will stifle its future as a leader in technology and global financial services,” said Perianne Boring, founder and president of the Chamber of Digital Commerce, an industry group in a statement on the expected passage of the bill.
“Our sincere hope is that Governor Hochul will see the devastating effect this moratorium will have on New York and not sign this bill.”
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