Lawmakers in New York State are pushing for a three-year moratorium on proof-of-work mining.
The proposed bill, which is set to be voted on today, April 25th, 2022, would restrict any new Clean Air permits from being offered for two years to any electricity producer using a carbon-based fuel source. The problem with this regulatory attempt is that the restrictions are vague enough to limit proof-of-work mining from producers using clean, renewable energy.
Most people are against firing up decommissioned fossil-fuel-based power plants solely for Bitcoin mining, as long as there are other comparable options for that local grid—there are exceptions for situations involving stranded power, as we see in some parts of the U.S.
But stalling all innovation in bitcoin mining based on its worst potential use-cases is a terrible regulatory approach.
This local news coverage from West Texas gives a sense of what Bitcoin mining can provide for communities that realize its potential.
Power and Money: Stranded Energy and Cryptocurrency in West Texas:
Back in New York, many have voiced their concern over the moratorium. From VC Fred Wilson, in a post titled, “An Earth Day Message To The New York State Legislature”:
“New York State should just put signs up on the Holland Tunnel, the Lincoln Tunnel, the George Washington Bridge, the Peace Bridge, and everywhere else people arrive in New York State that says “Web3 Is Not Welcome Here.” And save themselves the time and energy of doing nonsense like this.
We get the message loud and clear.” [AVC]
New York State and NYC can’t seem to get out of their own way. From the rejection of Amazon’s HQ2 a few years ago, its miserably-failed BitLicense, to the proposed ban of proof-of-work mining—NY state and city governments can’t see the forest for the trees.
We need more innovation, not more rules and regulations.
Ostensibly, NYC is the financial capital of the world. But most of the largest, most trusted crypto exchanges have this line in their terms and conditions (bolding is mine):
“FTX does not onboard or provide services to personal accounts of current residents of New York State (US), Ontario (Canada), Cuba, Crimea and Sevastopol, Iran, Afghanistan, Syria, North Korea, or Antigua and Barbuda.” [FTX.US TOS]
This is an abject failure on the part of NYS to position itself for the future. If we can’t see our way to embracing the innovation that will happen whether we like it or not—we will be left behind.