When China banned bitcoin mining last year, it launched a US cryptocurrency goldrush, with states such as New York, Kentucky and Georgia fast becoming major mining hubs, according to Reuters.
New York state assembly member Clyde Vanel couldn’t be happier.
“It’s a blessing that it’s happening here,” he said, pointing to the jobs the industry could create.
But Anna Kelles, a fellow assembly member, is pushing legislation that would severely restrict the power-hungry mining in New York, placing a moratorium on new mining operations that bring new fossil power sources online.
“We have an industry that in short order is going to derail our climate goals,” she warned.
The debate over the environmental impact of bitcoin mining is intensifying in the United States, with major environmental groups belatedly mounting a national pressure campaign criticizing its use of fossil fuels as the country tries to slash its emissions to meet climate change goals.
Bitcoin miners maintain the decentralized digital currency through a network of energy intensive computers — whose exact energy consumption and carbon footprint are hard to measure.
A 2021 estimate from the industry group CoinShare found that the network was responsible for less than a tenth of a percent of global emissions, while a separate report by the New York Digital Investment Group said it could reach at most 1 percent of global emissions by 2030.
But a study published by economist Alex de Vries, a persistent critic of bitcoin’s energy usage, in the energy journal Joul in March estimated it produced the carbon dioxide equivalent of the nation of Greece.
“We should be pushing bitcoin mining to decarbonize, just like any other industry,” said Margot Paez, a climate change scientist at the Bitcoin Policy Institute, a think-tank.
“But the reality is that, compared to other industries, bitcoin uses an insignificant amount of energy,” she said.
Bitcoin boosters say that other activities — such as running Christmas lights — consume roughly equivalent amounts of energy as the network, and that the social function of bitcoin is worth the energy load.
They also point to a few operations run on renewable energy — in particular in Texas where solar and wind farms are being brought online to power bitcoin mining.
But in places such as New York and Pennsylvania, miners have revived closed fossil fuel plants to power their work — and environmental groups have mobilized.
“We are in a climate crisis,” said Tefere Gebre, the chief program officer for Greenpeace USA at a recent press conference organized by environmental groups critical of the cryptocurrency.
And bitcoin mining, he said, “is pushing us in the wrong direction at the wrong time.”
New York Regulations
A law written by New York assembly member Kelles, which advanced out of the state’s natural resources committee in March, would place a moratorium on new fossil-fuel-powered bitcoin operations there.
If it passes, “New York will be signaling that it is closed for business,” said Kyle Schneps, director of public policy at New York-based bitcoin and consulting firm Foundry, which opposes the bill.
The fight over bitcoin mining in New York took off last year as residents of the small town of Torrey protested as a bitcoin mining firm took over a closed coal-fired power plant there and converted it into a natural-gas powered mine.
Environmental group Earth Justice has identified a number of other plants around the state it said could be subject to similar conversions — and legislator Kelles has gathered over 40 co-sponsors for legislation that would ban such activity.
Schneps, with Foundry, noted some bitcoin mines are driven by renewable energy, including hydropower, and that they can bring economic benefits.
His own firm has hired over 115 employees in New York, working in a range of roles from software engineering to sales, he said.
New York assembly member Vanel, who opposes the mining moratorium, worries it could drive miners away, saying lawmakers should collaborate with the industry to address any environmental concerns.
But Kelles said that without regulation to ban fossil-fuel-powered bitcoin mining, more dirty energy plants would come back online in the state, undermining its emissions reductions goals.
”Let’s put a pause on this now,” she said. “We spent 30 years getting these dirty plants off the grid.”
Scientists say global fossil fuel emissions must fall by a whopping 45 percent by 2030 to avoid the worst impacts of climate change, including ever-more-dangerous wildfires, floods and heatwaves.
But despite legions of emissions-slashing pledges, carbon pollution continues to rise, with the United Nations predicting a 16 percent hike by 2030, compared to 2010 levels, even if current government carbon-cutting plans are met.
Those on both side of the bitcoin divide agree that what happens in New York will have