The bill responds to growing environmental concerns, with officials warning of a potential 'reckoning' due to the high electricity usage of crypto mining and data centers.

This legislation could serve as a regulatory hurdle, potentially discouraging Bitcoin mining companies from operating in New York and prompting them to relocate to states with more favorable policies.

The legislation emphasizes balancing innovation with environmental and community health, arguing that miners provide little benefit relative to their costs and environmental footprint.

This bill builds on the expiration of previous moratoriums on fossil-fuel-based mining, aiming for a sustainable, long-term policy that encourages cleaner energy use and industry regulation.

Critics argue that the bill reflects a political bias against Bitcoin and crypto industries, overlooking potential economic benefits like job creation in struggling regions.

New York is advancing legislation aimed at regulating cryptocurrency mining, focusing on environmental impact and energy consumption, which could significantly influence the industry’s future in the state.

Crypto mining's energy consumption has surged, potentially reaching 3.5% of global electricity demand by 2025, with proof-of-work operations contributing significantly to this increase.

The legislation could impact major data center projects and investments in New York, including a $3.7 billion Google project and a Bitcoin mining firm, potentially delaying or halting these developments.

The proposed tax structure exempts miners using 100% renewable energy, following the expiration of a 2024 moratorium on clean energy mining, to incentivize sustainable practices.

The bill introduces a tiered excise tax on proof-of-work miners based on electricity consumption, with small miners using up to 2.25 million kWh annually exempt, while larger operations face escalating rates to fund energy affordability programs.

These operations are responsible for a substantial share of global electricity use, with New York's facilities consuming a notable portion, raising environmental and community concerns.

This tax aims to address the high energy costs associated with mining, which have caused financial losses for some companies, such as TeraWulf, amid rising electricity prices in early 2025.

Environmental impacts of mining include greenhouse gas emissions, water use, noise pollution, and electronic waste, especially affecting environmental justice communities.