The state of New York is analyzing a bill promoted by Senator Liz Krueger, which would apply a cryptocurrency mining tax that uses the work test method (POW).
The initiative S8518 It seeks that the costs of these operations be assumed by the mining companies themselves instead of citizens.
It is worth mentioning that Pow is a system used by some assets, such as Bitcoin (BTC), to validate transactions and protect the network. In this mechanism, miners must solve complex mathematical calculations through specialized computers, a process that requires large amounts of electricity.
According to him project, A staggered tax would be established by Kilovatio-Hora (KWH) used. The first 2.25 million kWh per year would not pay obligations, while the consumption of 2.25 to 5 million kWh would have a 2 cents per kWh, and that of 5 to 10 million kWh would be 3 cents per kWh.
For major consumption, the tax would continue to increase: between 10 and 20 million kWh, a 4 cents per kWh would apply, and any consumption exceeding 20 million kWh would be subject to 5 cents per kWh.
The initiative establishes that the facilities that work with renewable energy and that are not connected to the electricity grid They would be exempt from the tax. In addition, all revenues collected would be used for assistance programs for electricity consumers.
As in section 2 appears, the legislation responds to the impacts that cryptocurrency mining operations have had in local communities. The measure would come into force on January 1, 2027.
The project also indicates that New Yorkers face “huge loads derived from the unregulated growth of cryptocurrency mining operations with proof of work, but receive very few benefits, if they receive any.”
According to the sponsors of the initiative, these operations “alter the surrounding communities, do not generate jobs and pay very little for their own electricity consumption.”
Assume the cost of mining operations
In this line, it is made clear that the cost of generating and supplying additional electricity falls on all users, and in some locations substantial increases have been recorded in the rates when cryptocurrency miners are installed.
To support these arguments, Senator Krueger explains that, before the city of Plattsburgh, located in the north of the state of New York, would apply new rates to protect the community, mining operations paid around 2 cents per kWh, while residential households in New York pay, on average, 22,25 cents per KWh, according to the Energy Information Administration of US. UU.
Beyond the economic, the environmental and social impacts of cryptocurrency mining are also highlighted, which include “the prolongation of the life of gas energy plants, a significant consumption of fresh water, noise pollution and mass generation of electronic waste.”
Finally It is clarified that legislation does not prohibit miningbut it seeks that “the negative consequences generated by these mining operations are assumed and paid by the operators themselves, instead of the New Yorkers.”
According to estimates of the project itself, the measure could generate More than 700 million dollars in income For energy assistance programs.
The discussion about the regulation and use of cryptocurrencies in the United States reflects different state approaches. While New York seeks that miners internalize the energy costs they generate, other jurisdictions actively explore the adoption of BTC as a financial tool.
As Cryptonotics reported in May, an example is New Hampshire, which became the first state to allow the creation of a Bitcoin strategic reserve through Law HB 302, signed by Governor Kelly Ayotte.