BT Daily News: In US Crypto Mining Regulation, Where do the States Stand? and more
1. In US Crypto Mining Regulation, Where do the States Stand?
Bills in Arkansas and Montana that focus on crypto mining have passed in recent days, while legislation in other states remain in the ratification process.While some of the proposed or passed pieces of legislation seek to protect the rights of crypto miners, others seek to put certain restrictions on companies operating in the sector.
Where do the bills stand and what’s in them?
Of the 7 states examined below, most have legislation that is still working its through their political systems, while one, New York, has a crypto mining bill already signed into law.
Arkansas
The Arkansas Data Centers Act of 2023, passed by the state’s House and Senate last week, seeks to protect miners from discrimination.
The law prohibits a local government from imposing requirements for crypto miners that differ from those applicable to data centers, such as rezoning areas to unfairly target such businesses.
It also says the Arkansas Public Service Commission, which regulates the state’s utilities, is not allowed to establish “an unreasonably discriminatory rate” for crypto mining customers.
The act must be signed by Gov. Sarah Huckabee Sanders before it becomes law.
Montana
Montana’s House of Representatives passed a similar bill to Arkansas’s miner-friendly legislation on Wednesday.
It now heads to Gov. Greg Gianforte’s desk for final approval.
The bill allows industrial and at-home miners to conduct their business free from government interference, noting that crypto mining “provides positive economic value” for people and companies in the US.
Like the Arkansas law, Montana’s bill requires the government to treat crypto miners no different from data centers.
Missouri and Mississippi
Proposed laws in Missouri and Mississippi, like the bills in Arkansas and Montana, look to offer protection for crypto miners.
First proposed in January, the Missouri bill would similarly limit actions the state can take against such activities, such as prohibiting its Public Service Commission from setting discriminatory rates for a digital asset mining business.
It also looks to stop the state from prohibiting the running of nodes for crypto mining at private residences, according to a bill summary.
Mississippi’s proposed law brings up similar language to the Arkansas and Montana bills in that it would block the state from treating miners differently than data centers.
The Missouri bill was passed by the state’s House on March 7, but appears to have stalled.
The Mississippi bill passed the state Senate in February but failed to pass during a House of Representatives vote last month.
Texas
Texas Senate Bill 1751 would prohibit tax abatements on certain bitcoin mining property and set limits on miners’ participation in demand response programs.
The type of demand response the Texas bill would impact is ancillary services — where bitcoin miners, in this case, sell the right to the Electric Reliability Council of Texas (ERCOT) to curtail miner load as it sees fit to balance the grid.
Riot Platforms, a miner operating in the state, called the bill “misguided” and argued that it would lead to a more expensive and less reliable energy grid.
In a Wednesday letter to Lieutenant Governor Dan Patrick, leaders of the Chamber of Digital Commerce, the Texas Blockchain Council and the Satoshi Action Fund, wrote that the bill would have “devastating impacts on Texas’ leadership role in the digital economy and could have unintended consequences on the state’s energy security.”
Introduced last month, the Texas Senate voted to approve the bill on Wednesday. The bill now heads to the state’s House of Representatives.
Texas Blockchain Council President Lee Bratcher told Blockworks he believes Texas Senate Bill 1751 will “struggle to gain traction” in the House due to its “anti-competitive nature.”
Fred Thiel, CEO of crypto miner Marathon Digital, previously said he didn’t think the law would pass the House, noting he expects “sane heads will prevail.”
Analysts at Compass Point Research & Trading wrote in an April 10 research note that even if the proposal passes the Senate and House, they believe Texas Gov. Greg Abbott would veto it.
Oregon
An Oregon bill introduced in January would require facilities with high energy use, including those involved in crypto mining, to reduce greenhouse gas emissions.
Amazon had lobbied against the bill from the start of discussions, the Washington Post reported earlier this month, essentially killing it.
The tech giant “successfully nurtured fear that our energy requirements would drive away the development of data centers,” Oregon state Rep. Pam Marsh told the news outlet.
The bill would have set up specific emissions reduction targets in the years ahead — such as lowering emissions by 60% below their baseline current levels by 2027 — and required operators of such facilities to provide proof of compliance via annual reports to the Department of Environmental Quality.
Violations were to result in a $12,000 penalty per megawatt-hour in violation for each day not in compliance.
A public hearing related to the proposal was held on March 20. Those set to testify in support included leaders from Southern Oregon Climate Action Now and the NW Energy Coalition, while people from the Economic Development for Central Oregon and the Data Center Coalition were slated to speak in opposition of the measure.
New York
A crypto mining-related bill in New York is unique in that it is no longer pending.
The law, which paused crypto mining operations that use proof-of-work methods to validate blockchain transactions, was signed by Gov. Kathy Hochul last November.
The bill prevents the state from approving such operations that depend on carbon-based power for two years, noting that such crypto miners “impact compliance” with New York’s Climate Leadership and Community Protection Act.
Kristin Smith, executive director of Blockchain Association, had said before it was signed that the bill would have “a significant chilling effect on crypto mining in the state,” adding that it could send hundreds of jobs to other states.
2. HIVE Blockchain Produces More BTC in March 2022 despite Rising Mining Difficulty
HIVE Blockchain Technologies Ltd., a publicly-listed crypto mining company, has announced that it produced 282 Bitcoin in March 2023 from ASIC and GPU mining operations. The numbers if visibly higher from February's results, when HIVE mined 250 BTC.HIVE Blockchain Mines More Bitcoins in March 2023
The increase in production took place despite the appreciation of the difficulty of mining cryptocurrencies. The Bitcoin network difficulty increased to 46.8 trillion during March, reaching an all-time high. Accordingly, Bitcoin mining difficulty ended the month about 9% higher than at the beginning of the month.
The company's current BTC balance is approximately 2,310, and it produced an average of 9.1 BTC per day last month. The company has received over 5,600 BuzzMiners in its data centers, all of which are functioning. In addition, HIVE ended the month with 3.36 EH/s of mining capacity, including ASIC and GPU BTC hash rate, and sold all of the Bitcoin earned from its GPU mining hash rate payouts.
Although the number of Bitcoins in the inventories has been falling for the second month in a row, HIVE is increasing its output possibilities. Accordingly, it sells cryptocurrencies to cover its ongoing business costs and further investments. In February, the crypto miner produced BTC at a monthly average of 2.75 EH/s compared to January's 2.38 EH/s average hash rate.
3. CleanSpark Boosts Mining Capacity With New Machinery Worth $145 Million
The US-based cryptocurrency miner – CleanSpark – purchased 45,000 units of the Antminer S19 XP BTC mining machines for $144.9 million.The current computing power of CleanSpark is 6.7 EH/s, while the installation of the new equipment is expected to push it to 13 EH/s.
Preparing for the Halving
According to the deal, the manufacturer will distribute 25,000 units in August, while the remaining 20,000 should arrive in September. CleanSpark plans to deploy all of them at its mining facility in Sandersville, Georgia.
Zach Bradford – CEO of CleanSpark – said the Antminer S19 XP is “the most power-efficient bitcoin mining machine available in the market today” and raised hopes it will turn into a “key component” for the company’s operations.
He explained that the multi-million purchase and the delivery of first-class machinery is part of the firm’s strategy prior to the Bitcoin halving that is expected to occur in the spring of 2024.
The pivotal event, reducing the rate at which new coins are created, will cut block rewards in half – from the current 6.25 BTC to 3.125 BTC. Many experts believe the process will fuel a price surge of the primary cryptocurrency, similar to previous occasions.
“As bitcoin’s halving draws closer, our focus on operational efficiency, our technical expertise, and our treasury management strategy will all play a crucial role in solidifying CleanSpark’s position among the top bitcoin mining companies in America,” Bradford said.
The 45,000 new machines should also boost the mining capacity of the organization to 13 EH/s by September 2023. Bradford argued that the crypto winter had given firms a chance to acquire modern equipment at an industry-leading price:
“We have chosen other units, such as the S19 jPro+, over the S19 XP in the past because we believed the gap would close on the delta between the ROI of other units and the XP. Our patience has paid off.”
CleanSpark’s Mining Expansion
The company acquired a site in Washington, Georgia, for $16.2 million in the summer of 2022. It recently started enlarging the facility so it can eventually accommodate 16,000 miners. CEO Bradford is determined that the expansion will add 50 MW to the existing 36 MW of infrastructure:
“This second phase more than doubles the size of the existing operation. We are looking forward to expanding our relationship with the Washington City community and to being able to support the construction jobs that will come with this expansion.”