Arkansas State House Advances Bills to Regulate Cryptocurrency Mining Amid Global Legal Challenges
Summary:
The Arkansas State House has passed two potential bills that could limit cryptocurrency mining across the state. The bills target various issues within crypto mining such as noise pollution, foreign ownership, and residential proximity. Notably, Act 851 is under scrutiny for potential amendments. International legal challenges regarding crypto mining are also highlighted with a mention of Paraguay's proposed temporary ban on the same. The impending Bitcoin halving presents additional pressure on miners, potentially leading to a significant sell-off post the event.
Two potential bills aimed at limiting cryptocurrency mining activities have been approved by the Arkansas State House, setting the stage for more in-depth legislative discussions. The resolutions were deliberated over in an April 17 Senate hearing where issues like noise levels, foreign ownership, and the location of crypto mines relative to residential neighborhoods were addressed. Two of eight bills introduced on Wednesday received the House's approval, differing from the Senate's approval of a single cryptocurrency bill the previous week. The extent to which Act 851 should be adjusted and the degree of specificity required in these changes remain contentious topics. In either the current or subsequent legislative session, the committees will deliberate on the issue prior to potentially passing a law.
The proposed Arkansas Data Centers Act of 2023, as per the legislative text, aims to govern the state's Bitcoin mining industry by erecting provisions for miners and safeguarding them against biased regulations and financial impositions. Bitcoin mining practices, notorious for their extended duration and high-energy requirement, have been criticized for the substantial waste they produce. It is estimated that Bitcoin mining results in over 77 kilotons of electronic waste annually, as reported by Investopedia.
Legal issues related to crypto mining extend beyond US borders as illustrated by recent events in Paraguay, where lawmakers proposed a temporary ban on crypto mining and associated activities. They argued that illicit crypto mines disrupt power distribution by unlawfully consuming electricity. The proposed law seeks to outlaw the installation of crypto mining infrastructure and transactions involving cryptocurrency creation, conservation, storage, and trade. Developments relating to the crypto mining ban have been put on hold by Paraguayan senators, who are now weighing the advantages of selling excess energy produced by the Itaipu hydropower plant to mining operations.
In light of the impending Bitcoin halving scheduled for this week, miners face increased pressure. Following the halving, miners may end up selling around $5 billion worth of Bitcoin (BTC), forecasts Markus Thielen, lead researcher at 10x Research. He suggests that the fallout of this selling might extend over four to six months, potentially rendering Bitcoin price stagnant for some time, mirroring past post-halving episodes. Thielen further hinted at a similar situation, with crypto markets possibly bracing for a notable challenge during a six-month "summer" lull period.
Published At
4/18/2024 11:56:47 AM
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