Earlier in May, the Congress of the state of New York drafted a bill that would ban bitcoin mining in the state of New York. Yesterday, on June 30th drafted bill passed the floor of the New York State Senate, and will become the law. With this new law, the bitcoin mining, or any other ‘cryptocurrency mining operations that use proof-of-work authentication methods to validate blockchain transactions’.
By the words of the officials ‘there is only one such plant in current operation that wouldn’t be affected by the bill.’ So this bill is dealing the possible development of the mining industry, in particular bitcoin mining industry, as bitcoin is a biggest cryptocurrency that is using proof-of-work consensus protocol as a security mechanism.
In order to participate in bitcoin network security, bitcoin miners solve the cryptographic problem (called ‘target’) and provide the proof-of-work result. The first one who submits the correct answer, claims the award in a form of a newly minted bitcoins.
Bitcoin mining machines, are specialized computer graphic cards ASIC (which stands for Application-Specific Integrated Circuit) that consume a lot of electricity. Even the smallest ones are more powerful than several personal computers joint together. The amount of electricity needed for the mid-to-full size mining operation is almost the same of the amount used for powering massive computer data centers. This, of course raised a lot questions related to the environmental impact of the cryptocurrency mining.
In the US, and other parts of the world, concerns are growing around the bitcoin mining industry. Miners are utilizing the alternative sources of energy, as more and more countries are charging bitcoin miners an expanded price for electricity. Miners have been particular efficient making deals with the oil and gas companies, as they use natural gas and byproducts of oil drilling.