New York Tightens Regulations on Bitcoin Mining

The New York legislature sent a bill to Gov. Kathy Hochul's desk today that many in the industry are characterizing as a crackdown on the cryptocurrency mining industry. Trumpeted as a two-year moratorium on the process used to produce bitcoin, known as proof-of-work mining (which is more energy intensive) the bill actually imposes a restriction on issuing or renewing (in certain cases) air permits for carbon-based power plants that have direct (or "behind the meter") connections to mining infrastructure.

If signed into law, this bill may have a wide-reaching impact on the crypto mining industry in New York and the region if other similarly situated states follow suit. In addition to stifling further investment, this bill may have a significant impact on miners and power producers with existing interconnections.

As the regulatory climate has chilled towards miners in New York, its share of bitcoin mining has dropped from around 20% to 10% in a matter of months, as producers seek what they deem to be "friendlier" jurisdictions, like Texas.

If enacted, the bill may create additional opportunities for non-carbon based infrastructure (like nuclear and renewables), which appears to be the legislature's goal. However, experts are divided as to whether miners will be wary of further regulatory action and avoid the state entirely.