The crypto market suffered another clampdown in the last days of November following the new Crypto mining law which was signed into effect in New York last week; banning large crypto companies from engaging in any form of crypto mining that uses Carbon as its energy source. The Governor of the state cited the need for maintaining a healthy environment for its citizens as the major reason why this decision was necessary. Mining as we know is needed to strengthen the security of Blockchains that utilize the Proof-of-work mechanisms.
Can Crypto traders still buy Cryptocurrency in USA today amidst this clampdown on crypto mining in New York? Will hackers find more grounds to attack the Proof-of-work blockchains in the state? What impact will this have on the crypto market at large? Can crypto trading still be sustainable in New York today amidst the recent ban? This work will help you find some answers to these important questions.
New York Bans Crypto Mining Companies that Use Carbon Energy
The increasing concern over climate change and maintaining a healthy environment for the citizens had led many states into creating new laws to guide Crypto mining within their regions. While many countries today are still formulating some policies to guide mining in their country, New York has emerged as the first state today to sign into law a new policy to regulate crypto mining within the state.
The mining law which was passed earlier at the State Assembly in April and followed by the Senate in June has been signed into law in November – limiting certain types of Crypto mining within the province. By this law, all crypto mining companies that depend on Carbon energy as well as those using electricity derived from burning fossil fuels are hereby prohibited within the state.
This law will therefore make it impossible for Bitcoin mining companies to renew their mining licenses within the next two years except when they provide evidence of their mining operations as fully dependent on the renewable energy sources. This means only companies that utilize renewable energy sources for mining will be allowed to operate in the state.
The law does not apply to individual miners but only the large-scale miners that consume a large amount of energy while carrying out their mining activities.
The governor explained that the state hopes to extend the concern over climate change by reducing the mining activities that burn a large number of carbons as well as those needing electricity power plants which has to burn fossil fuels in the process.
What Effects Will the New York Ban on Large-Scale Crypto Miners Have on Crypto Currency Today?
The present ban on large-scale miners in New York will greatly affect Bitcoin mining and other proof-of-work cryptocurrencies that depend on mining for adding new blocks to their blockchain.
Mining no doubt plays an important role in strengthening the security of their networks and reduces the chances of their being attacked easily.
Thus, limiting mining in the state will all the more expose those cryptocurrencies using the proof-of-work mechanism within the state to greater chances of being attacked successfully.
Advantages of Crypto Mining in New York Today
- Helps to strengthen the security of a given cryptocurrency Blockchain.
- Offers miners some rewards for each successful mining.
- Creates an employment opportunity for miners.
Disadvantages of Crypto Mining in New York Today
- Mining consumes a large amount of energy.
- Some mining may be unsuccessful leading to a waste of time and resources.
- Some of the tools for large-scale mining are expensive.