New York Governor signs PoW mining moratorium into law

New York Governor Kathy Hochul sign The proof-of-work (PoW) mining moratorium was signed into law on November 22, making it the first US state to ban all crypto PoW mining activity for two years.

The PoW mining moratorium will not only prohibit new mining operations, but will also deny license renewals to those already operating in the state. Any new PoW mining in the state could only work if it uses 100% renewable energy.

The PoW mining bill was the first passed by the state assembly in April earlier this year and later got the state senate nod in June. The bill was eventually signed into law by Governor Huchkul due to pressure from lobbyists and to meet his carbon emissions targets. Huchkul wrote:

“I will ensure that New York continues to be the center of financial innovation, while taking important steps to prioritize the protection of our environment,”

Consensus PoW mining is primarily used by Bitcoin miners and a few other altcoins. It is considered one of the most secure and decentralized ways to authenticate a transaction on a blockchain. However, this practice has been marred by controversy over its high power consumption.

The United States currently sits at the top of Bitcoin mining hashrate share by country with 37.8% of the Bitcoin network hashrate coming from the United States. The two-year moratorium on PoW mining may prove costly and even create a domino effect for other states to follow a similar path.

Blockchain advocacy group the Chamber of Digital Commerce denounced the false narrative in a Twitter Publish:

“The state’s argument that the mining industry’s energy consumption exponentially exceeds other industries is patently false. The Climate Leadership and Community Protection Act requires New York’s greenhouse gas emissions to be reduced by 85% and achieve net zero emissions in all sectors by 2050.”

PoW mining FUD is not new and has been repeatedly debunked, however, there has been significant lobbying effort over the past year, particularly from proponents of proof mining of attendance. Greenpeace and Ripple co-founder Chris Larsen campaigned for a change in bitcoin code.

Lawmakers, on the other hand, conveniently dismissed available research reports that a significant portion of Bitcoin’s mining energy comes from renewable sources. Bitcoin Mining Council’s report pointed out that more than 60% of electricity consumption by the BTC network comes from clean sources.

European crypto regulators had proposed a similar ban on PoW in their Crypto Asset Markets (MiCA) legislation. However, proponents of the ban operations with PoW-based digital assets could not muster enough supportmeaning that the MiCa legislation was passed without such a ban.