The New York Parliament approved a bill to ban Proof-of-work mining in recent news. The bill aims to address the issue of environmental concern surrounding crypto mining.
The proposal will affect cryptos such as the flagship currency, Bitcoin. The digital currencies use the PoW mechanism to validate crypto transactions on the blockchain.
Last month, the state Assembly approved the same bill. Now, the Senate has endorsed it. The legislation will enforce a two-year ban on companies using carbon-based fuel for mining.
Meanwhile, mining companies or those about to renew their permit can still operate in the state.
One Facility Not Affected By The Legislation
Senator Kevin, the sponsor of the bill, noted that one firm would not be affected. This firm currently operates with carbon-based fuel. Also, he said a pending part of the application might be put on hold. This is to give room for further research before they reach a decision.
The Senate Environmental Conservation Committee failed to address the bill during the last meeting. Hence, most people believed the proposal would perish the same way it did last year.
Last month, Sen. Todd Kaminsky informed the committee that this legislation is dangerous. Kaminsky believes that the economy of New York will crumble if the state becomes anti-crypto. The Senator implored the parliamentary committee to have a rethink.
Meanwhile, the Senate received the legislation before the end of their Thursday meeting at midnight. This was because of the late report from the Telecommunications Committee and the Environmental Conservation Committee.
New York Depends On Hydroelectric Power
Most crypto mining companies consider New York a favourable location for their operations. This is because the state depends on hydroelectric power, which is relatively inexpensive.
On the contrary, countries such as Kazakhstan depend on coal-based electricity. This did not meet up with the increased demand for electricity by miners. Also, the populace and miners combined were too much. As a result, the country increased electricity tariffs.
Meanwhile, in areas of the US, such as Texas, coal stations lay abandoned for years. Therefore, mining companies are working on using this to generate power. This development is also ongoing in other parts of the world.
At the moment, the ban has not become law. If the bill becomes law, mining firms may relocate. Some crypto mining firms are looking at states such as Texas to cite their mining facilities.