[2022-06-03] New York just passed a bill cracking down on bitcoin mining

[zasad@]

https://www.cnbc.com/2022/06/03/heres-whats-in-new-yorks-new-bitcoin-mining-ban-.html?
"New York just passed a bill cracking down on bitcoin mining — here’s everything that’s in it

Lawmakers in New York just passed a bill to ban certain bitcoin mining operations that run on carbon-based power sources.
The measure now heads to the desk of Governor Kathy Hochul, who could sign it into law or veto it.
If it passes, it would make New York the first state in the country to ban blockchain technology infrastructure"

[DaveF]

It does not kick miners out, it just does not allow them to expand unless they are running on 100% renewables.
Also, and this is important to think about, in a lot of places in NY you are almost 100% green energy.
Keep in mind too, unless they are generating their own power, NY (and a lot of other states as far as I know) allow you to 'buy' your power from anybody.
i.e. where I am PSEGLI supplies the support and lines and everything else. I can BUY the actual electricity from a host of different companies. All of which are about the same price.
So they switch their purchases from this to that, possibly pay a fraction of a penny more and go on with what they are doing.

https://www.coned.com/en/save-money/shop-for-energy-service-companies/find-your-esco


-Dave

[SFR10]

It does not kick miners out, it just does not allow them to expand unless they are running on 100% renewables.

Maybe not in a direct manner, but it indirectly affects everyone who's involved in this field and personally, I see no reason to stay in a state that clearly doesn't like such operations.

Also, and this is important to think about, in a lot of places in NY you are almost 100% green energy.

You're probably correct, but when you take everything into account, it becomes just one-third of that:

• A third of New York’s in-state generation comes from renewables, according to the latest available data from the U.S. Energy Information Administration.

[NotATether]

If it passes, it would make New York the first state in the country to ban blockchain technology infrastructure"

That is not "blockchain technology infrastructurre". It merely bans mining operations that generate coins in the blockchain, and only those running with carbon as a power source (and no others).

I know that in the depressed ads market, news sites need every click they can get, but they can get them without lying to people, you know. :/

As usual, miners will find a way around this.

[DaveF]

If it passes, it would make New York the first state in the country to ban blockchain technology infrastructure"

That is not "blockchain technology infrastructurre". It merely bans mining operations that generate coins in the blockchain, and only those running with carbon as a power source (and no others).

I know that in the depressed ads market, news sites need every click they can get, but they can get them without lying to people, you know. :/

As usual, miners will find a way around this.

I don't think that it's total clickbait, it's more along the lines of they don't understand it.

NY is trying to do 2 things at the same time that LOOK to the unknowing to be going in different directions. But can actually be seen as going in the same.

In what is known as upstate NY there is a lot of green energy and such. Almost total usage.
HOWEVER, it is not that populated and does not have that much industry as compared to the rest of the state.

Or to put in another way. NY has about 20 million people living in about 55,000 square miles (145,000 km2) [approx numbers]

Long Island is 1400 of those square miles with 8 million of those people living there
Manhattan is 24 square miles with 1.7 million people
The Bronx and Staten Island are about another 2 million people living in 175 square miles.
So more then 1/2 the population lives in less the 10% of the space.
Very little green power is generated here just due to the amounts needed and lack of space. The rest of NY can get away with hydro and other greener sources.
In order to meet green goals they are trying to make sure that what is built does come in and stay green.

So they are pushing the tech end so to speak: https://fortune.com/2022/02/01/new-york-city-silicon-valley-cryptocurrency-startup-funding/
While trying to also keep mining clean.

Will it work? No idea, get back to me in a couple of years and I'll let you know :-)

-Dave

[bbc.reporter]

It does not kick miners out, it just does not allow them to expand unless they are running on 100% renewables.
Also, and this is important to think about, in a lot of places in NY you are almost 100% green energy.
Keep in mind too, unless they are generating their own power, NY (and a lot of other states as far as I know) allow you to 'buy' your power from anybody.
i.e. where I am PSEGLI supplies the support and lines and everything else. I can BUY the actual electricity from a host of different companies. All of which are about the same price.
So they switch their purchases from this to that, possibly pay a fraction of a penny more and go on with what they are doing.

https://www.coned.com/en/save-money/shop-for-energy-service-companies/find-your-esco


-Dave

How would this affect the price of renewable sources of energy if the miners begin using them and increase the demand? The skeptical me thinks this is what the state of New York is trying to do. It will also relieve financial pressure from the government because is it not that these renewable energy companies are only profitable through subsidies from the government and maintain operations? I am not certain of this, however. But there was an article that Tesla receives government subsidies as one of their sources of revenue.

[davis196]

How would this affect the price of renewable sources of energy if the miners begin using them and increase the demand? The skeptical me thinks this is what the state of New York is trying to do. It will also relieve financial pressure from the government because is it not that these renewable energy companies are only profitable through subsidies from the government and maintain operations? I am not certain of this, however. But there was an article that Tesla receives government subsidies as one of their sources of revenue.

I don't believe that the crypto miners in New York are the biggest electricity consumer in the state. The green energy prices might increase a little bit, but there won't be a price shock.
AFAIK, the companies that produce green energy receive government subsidies and there's nothing wrong with that.
The crypto miners will be buying green energy at a lower price, because of the government support. The miners must be happy about this.
New York isn't the most important place in the world, when it comes to cryptocurrency mining, so we shouldn't pay that much attention to such news. Russia is way more important for the crypto miners.

[ABCbits]

It does not kick miners out, it just does not allow them to expand unless they are running on 100% renewables.

Maybe not in a direct manner, but it indirectly affects everyone who's involved in this field and personally, I see no reason to stay in a state that clearly doesn't like such operations.

Finding suitable building and moving your hardware isn't exactly cheap though. I expect most miner on New York would stay unless their operational cost massively increased due to this bill.

New York isn't the most important place in the world, when it comes to cryptocurrency mining, so we shouldn't pay that much attention to such news. Russia is way more important for the crypto miners.

New York is largest city on US though, this bill could influence government on different state or county.

[stompix]

Keep in mind too, unless they are generating their own power, NY (and a lot of other states as far as I know) allow you to 'buy' your power from anybody.
i.e. where I am PSEGLI supplies the support and lines and everything else. I can BUY the actual electricity from a host of different companies. All of which are about the same price.

Since you're obviously more knowledgable with the US stuffm does  NY, or any state in the US allow the same green scheme that is happening here in the EU?

Company A contracts 100Mwh of consumption from hydro powerplant X, this powerplant gets paid for that, but the power plant delivers this to the grid according to their production, so even if for example company A works at full time and the dam turbines are on maintenance company A is considered green if at the end of the month 100mwh were produced and 100 mwh were consumed. Despite company B using during the night all the hydropower they are not labeled as green since they don't have a contract that stipulates the source!

So basically all I have to be green is for my company to have a contract for all the power with a green producer and that producer to deliver that quantity to the grid, it doens't have to be the same energy at the same hours at the production and same quantity!

In what is known as upstate NY there is a lot of green energy and such.

I was living under the impression a lot of that green one comes from Canada?

[DaveF]

Keep in mind too, unless they are generating their own power, NY (and a lot of other states as far as I know) allow you to 'buy' your power from anybody.
i.e. where I am PSEGLI supplies the support and lines and everything else. I can BUY the actual electricity from a host of different companies. All of which are about the same price.

Since you're obviously more knowledgable with the US stuffm does  NY, or any state in the US allow the same green scheme that is happening here in the EU?

Company A contracts 100Mwh of consumption from hydro powerplant X, this powerplant gets paid for that, but the power plant delivers this to the grid according to their production, so even if for example company A works at full time and the dam turbines are on maintenance company A is considered green if at the end of the month 100mwh were produced and 100 mwh were consumed. Despite company B using during the night all the hydropower they are not labeled as green since they don't have a contract that stipulates the source!

So basically all I have to be green is for my company to have a contract for all the power with a green producer and that producer to deliver that quantity to the grid, it doens't have to be the same energy at the same hours at the production and same quantity!

In what is known as upstate NY there is a lot of green energy and such.

I was living under the impression a lot of that green one comes from Canada? 

You are credited in green for what you bought not what you received. Since power is fungible so long as 100Mwh of green is going into the grid that you paid for and in theory could be delivered to you it's all good.
As for power from Canada, I don't know. Not sure if all the Niagara Falls power is US or US / Canada mixed. As far as I ever knew the US power grid is separate from the Canadian power grid, but I never really paid attention as to where it comes from so I could be wrong on that.

-Dave

[bbc.reporter]

How would this affect the price of renewable sources of energy if the miners begin using them and increase the demand? The skeptical me thinks this is what the state of New York is trying to do. It will also relieve financial pressure from the government because is it not that these renewable energy companies are only profitable through subsidies from the government and maintain operations? I am not certain of this, however. But there was an article that Tesla receives government subsidies as one of their sources of revenue.

I don't believe that the crypto miners in New York are the biggest electricity consumer in the state. The green energy prices might increase a little bit, but there won't be a price shock.
AFAIK, the companies that produce green energy receive government subsidies and there's nothing wrong with that.
The crypto miners will be buying green energy at a lower price, because of the government support. The miners must be happy about this.
New York isn't the most important place in the world, when it comes to cryptocurrency mining, so we shouldn't pay that much attention to such news. Russia is way more important for the crypto miners.

You are correct. I am not very certain of this, however, there might not also be any cryptocoin miners of importance in the state of New York hehe. It appears that we might only be again the victims of mainstream media's favorite part of their job. This is to have news readers click their clickbait hehehe.

It also appears that the mainstream news media is beginning their mining uses too much energy storylines again. I speculate that because of higher energy prices, many politicians might start campaigning for the ban of miners in America and it will get the support of much of the public.

[DaveF]

And due to the heat in Texas miners in are shutting down:
https://www.theblockcrypto.com/post/151084/bitcoin-miners-in-texas-have-been-powering-down-amid-heatwave-and-record-electricity-demand

So just because you can move then and in general get cheap power / rent / whatever it does not mean it's good for your business.

Sorry but that's just the way it is. Shutting down now due to heat. Shut down earlier in the year due to winter storms:
https://www.cnbc.com/2022/02/03/winter-storm-descends-on-texas-bitcoin-miners-shut-off-to-protect-ercot.html

So this is also part of the issue. Your staff still gets paid even if the mine is off, your rent still has to get paid, your insurance still has to get paid and so on.

How much are fixed costs costing them during this downtime.
Green / not green / cheap power / whatever does not help you if you can't run the miners.

-Dave

[PrimeNumber7]

And due to the heat in Texas miners in are shutting down:
https://www.theblockcrypto.com/post/151084/bitcoin-miners-in-texas-have-been-powering-down-amid-heatwave-and-record-electricity-demand

So just because you can move then and in general get cheap power / rent / whatever it does not mean it's good for your business.

Sorry but that's just the way it is. Shutting down now due to heat. Shut down earlier in the year due to winter storms:
https://www.cnbc.com/2022/02/03/winter-storm-descends-on-texas-bitcoin-miners-shut-off-to-protect-ercot.html

So this is also part of the issue. Your staff still gets paid even if the mine is off, your rent still has to get paid, your insurance still has to get paid and so on.

How much are fixed costs costing them during this downtime.
Green / not green / cheap power / whatever does not help you if you can't run the miners.

-Dave

It shouldn't be any surprise that electricity is being rationed in Texas due to heat. This isn't the first time it has been hot in Texas, and there were major issues with the electrical system just last year. Given the political climate, I don't think it is any surprise there are regulations being implemented on mining in New York.

I think the crackdowns on miners in China was a legitimate surprise, but the crackdown in places such as New York, and the rationing of electricity in Texas is just poor planning on the part of miners who are mining there.

[ChrisPop]

I don't agree with this bill. I mean it is like saying that contributing to the security of the Bitcoin network is not a worthy business to use carbon-based power sources, while other businesses like plastic fabrics, transportation firms or retail stores are acceptable... I thought USA was a country focusing on innovation and the spirit of freedom.

I'm not saying that using renewables energy sources shouldn't be enforced (IT SHOULD!), but for all businesses gradually, not just to some isolated niches. Leaders of the world need to find the balance between economic development, defense and environment protection. I won't say that I know which one of these needs to be prioritized, but the ones in charge need to find a fine balance between these three WITH the future generations in mind. What's the meaning if we have high living standards if the world as we know it will be evaporated in 50 years due to climate change?

[cr1776]

I don't agree with this bill. I mean it is like saying that contributing to the security of the Bitcoin network is not a worthy business to use carbon-based power sources, while other businesses like plastic fabrics, transportation firms or retail stores are acceptable... I thought USA was a country focusing on innovation and the spirit of freedom.
...

Look at who is running NY (and DC) and you will be able to see that elections for freedom.  Just ask the Democrat party in 1860.

[Nazmul07]

 I don't agree with this bill. I mean it is like saying that contributing to the security of the Bitcoin network is not a worthy business to use carbon-based power sources, while other businesses like plastic fabrics, transportation firms or retail stores are acceptable... I thought USA was a country focusing on innovation and the spirit of freedom.

I'm not saying that using renewables energy sources shouldn't be enforced (IT SHOULD!), but for all businesses gradually, not just to some isolated niches. Leaders of the world need to find the balance between economic development, defense and environment protection. I won't say that I know which one of these needs to be prioritized, but the ones in charge need to find a fine balance between these three WITH the future generations in mind. What's the meaning if we have high living standards if the world as we know it will be evaporated in 50 years due to climate change?

[bbc.reporter]

And due to the heat in Texas miners in are shutting down:
https://www.theblockcrypto.com/post/151084/bitcoin-miners-in-texas-have-been-powering-down-amid-heatwave-and-record-electricity-demand

So just because you can move then and in general get cheap power / rent / whatever it does not mean it's good for your business.

Sorry but that's just the way it is. Shutting down now due to heat. Shut down earlier in the year due to winter storms:
https://www.cnbc.com/2022/02/03/winter-storm-descends-on-texas-bitcoin-miners-shut-off-to-protect-ercot.html

So this is also part of the issue. Your staff still gets paid even if the mine is off, your rent still has to get paid, your insurance still has to get paid and so on.

How much are fixed costs costing them during this downtime.
Green / not green / cheap power / whatever does not help you if you can't run the miners.

-Dave

This is only part of the challenges of doing business in Texas. I am quite certain there are factories and manufacturers that are also affected by the higher electricity costs. I reckon depending on their 12 month projection, they can get a loan from a bank to support their cashflow until conditions for mining become more optimistic again. However, the problem might be many banks might not want to take the risk of giving a loan to a company that mines a volatile speculative asset.