Addressing ‘My Right’ to Crypto

New York battered the mining industry with zero regulations and oversight, before passing its first-in-the-country cryptocurrency mining moratorium last year. But the tides are changing. Now, after the Biden administration recommended more rules and Sen. After Ed Markey (D-Mass.) introduced a bill to crack down on industry’s massive energy use, the industry seems scared — and retaliated by tripling its spending on Capitol Hill lobbyists. Some groups are trooping down on Capitol Hill, pushing “right to mine” bills in states across the country. These bills, along with the alleged ban on zoning for proof-of-work cryptocurrency mining operations and areas that enforce noise ordinances, at least severely limit the rights of communities to regulate and protect themselves against for-profit interests. reduce rights. They give big businesses (most crypto mining companies are well capitalized) the “right” to mine crypto, even at the expense of your right to clean water and air, a cool home, and a livable climate. .

Many people imagine cryptocurrency miners as regular people at home, mining bitcoins on their laptops. But this type of mining is only a small minority, because the more computational power you have, the more bitcoins you can earn, and mining requires more and more energy over time. Now, mining is mainly profitable for large companies that have the means to store thousands of specialized high-powered computers and run them all day, every day.

According to a 2021 paper from the National Bureau of Economic Research, 90 percent of all bitcoin mining goes to just the top 10 percent of miners, and just .1 percent — about 50 miners — control half of all mining capacity. Make no mistake, the Bill of Rights to Mine is designed to protect larger, for-profit interests at the expense of local communities.

With thousands of machines running simultaneously, cryptocurrency mining isn’t just a loud annoyance, with what neighbors at a mining facility in Limestone, Tenn., describe as “idling like a jet engine on the nearby tarmac.” Neighbors of a cryptocurrency mining facility in Cherokee County, NC, described the noise as “like living on top of Niagara Falls,” and near Niagara Falls itself, locals complained that local cryptocurrency mining operations literally drowned out the sound of the falls. There, he won a zoning ordinance—the type of community self-protection that could be illegal under the authority of the state’s mine law.

The Right to Mine bill also seeks to protect miners by charging fair electricity rates to cryptocurrency miners — even though cryptocurrency mining operations often end up costing others unlucky enough to share their energy utility. Because these facilities are so energy intensive, they can demand new transmission and distribution lines, infrastructure upgrades, and more. In Paducah, Kentucky, for example, Blockware Mining secured $12.7 million in transmission upgrades, raising bills for regular utility customers to help pay for the upgrade. It is also common for cryptocurrency mining operations to simply up and leave, sticking locals out of their bags. In Washington, a cryptocurrency mining operation that went bankrupt in 2018 left locals scrambling to cover their $700,000 in unpaid utility bills. This is a net negative for these communities, especially because cryptocurrency mining operations are notorious for promising economic growth and creating new jobs without typically delivering.

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The cryptocurrency mining industry would also like you to believe that it is cleaning up the electric grid and doing everything it can to fight climate change. Don’t fall for it. Cryptocurrency miners look for the cheapest energy wherever they can find it, no matter how dirty it is. In Missouri, House Bill 764, which is currently making its way through the state legislature, would increase electricity use in the coal-dominated grid, slowing the state’s transition to clean energy. Montana is similarly coal-dominated, and the mine rights bill that recently passed the state senate there would prevent more local governments from adopting supportive regulations, such as the one in Missoula County to galvanize local communities against the negative effects of mining and Designed to protect the environment. Mississippi — another state where a mine rights bill recently passed the Senate — has a torn gas-dominant grid. All of these states are bringing in legislation that will increase America’s carbon footprint at a time when we need to be focused on reducing it wherever we can.

the kicker? Cryptocurrency doesn’t have to come at the expense of our environment. Proof-of-work cryptocurrency mining is far from the only way to validate cryptocurrencies – other methodologies have neither the excessive energy demands, nor other environmental impacts. Therefore, it is entirely possible for policymakers to be pro-crypto and pro-business without an anti-community and anti-local administration. In fact, the local business community in Upstate New York pushed for a cryptocurrency mining moratorium, as negative impacts of mining threaten their rural, agricultural livelihoods. The federal government cannot shy away from regulating this industry, and states that wish to do so should look to Washington State as a model, where House Bill 1416 would impose clean energy standards for cryptocurrency miners. Or of course, the cryptocurrency mining moratorium in New York. We can have it all – but not if the Right to Mine Bill becomes law.

Liz Moran is a policy advocate based in the Northeast Office for Economic Justice, which works to combat the climate crisis, protect water quality, keep public health and the environment safe from toxic chemicals, as well as promote more sustainable food and farming methods. Working towards policies to make.

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