Bitcoin Miners Operating in New York State Must Use 100% Renewable Energy or Leave.
An abusive new law requires of the Bitcoin mining industry what New York State does not require of any other industry.
A new law limits Bitcoin mining activities in New York State, USA. Miners must now use 100% renewable energy or face consequences. The new law went into effect on November 22, 2022.
Not all Bitcoin miners are welcome in New York State anymore. Mining companies that run on carbon-based energy are banned. For the next two years, only mining farms using 100% renewable energy will be allowed to expand and renew their licenses.
For newcomers, it's the same penalty: only 100% renewable energy operations will be allowed to be set up in New York State.
This is the first time such a law has been implemented in America, and it will drastically reduce development opportunities for companies that are not entirely based on renewable energy. Most importantly, the law is going to directly impact the state, which is one of the largest in the country in terms of Bitcoin production.
That's pretty amazing when you think about it that Bitcoin is being treated completely differently from other industries, as no other industry is currently required to do so.
The issue of Bitcoin's energy consumption is something that is misunderstood by political actors who are always trying to point the finger at Bitcoin to unfairly denigrate it in the eyes of the general public.
Accused (falsely) by its detractors of polluting too much, while the professionals of the sector assure that it is a lesser cost, Bitcoin is always controversial. This is exactly why New York State has chosen to regulate its fossil fuel consumption. Since China banned mining on its territory, the United States is what one might call “the world's leading Bitcoin issuer,” since America is the dominant country in terms of the Hash Rate of the Bitcoin network.
According to the University of Cambridge, which maintains an atlas of Bitcoin's energy consumption, the U.S. is far and away the world's leader in terms of the Bitcoin network's Hash Rate. It provides 37.8% of all computing power, far ahead of China (whose network of underground miners continues to provide 21.1% of the global Hash Rate) and Kazakhstan (13.2%).
And of all the American States, New York is particularly important: it has the 4th highest Hash Rate in the country. The new law will therefore be a blow to the entire New York Bitcoin industry, and more broadly, to the nation's Bitcoin industry.
For now, the impact that the law will have on the sector is difficult to determine. But it will have to be watched closely because a domino effect on all of America is not to be ruled out.
Faced with this outrageous and unfair law, Bitcoin miners in New York will have two choices. The first is to try to raise their standards, which are already among the highest in the industry in America, even though the mining industry in America already uses over 60% renewable energy for electricity.
The second would be to move their equipment to other smarter States in America, such as Texas. Be careful, however, because other American regions could be tempted to follow the example of this law which is in force in the State of New York.
Proof that the second option was already anticipated by the American players in the Bitcoin industry, the share of New York State in the Hash Rate of Bitcoin coming from America has already dropped from 20 to just under 10% in the last few months. It remains to be seen in a few weeks whether the decline in the Hash Rate from New York State continues, or whether it remains stable.
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