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New legislation in Arkansas singles out Bitcoin miners introducing targeted state fee New legislation in Arkansas singles out Bitcoin miners introducing targeted state fee

New legislation in Arkansas singles out Bitcoin miners introducing targeted state fee

Bitcoin miners are facing increased regulatory attention due to the energy demands of their operations.

New legislation in Arkansas singles out Bitcoin miners introducing targeted state fee

Cover art/illustration via CryptoSlate. Image includes combined content which may include AI-generated content.

The Arkansas Senate has greenlit a resolution introducing legislation to impose fees on crypto miners for excessive energy consumption, Arkansas Times reported on April 15.

The proposed legislation introduces a tiered fee structure to the emerging industry. Miners consuming 1 MW to 2.49 MW of energy would face a fee of $25,000. For energy usage between 2.5 MW and 4.99 MW, the cost would be $50,000. Miners utilizing 5 MW to 10 MW would incur a $75,000 fee, while those exceeding 10 MW would pay $100,000.

Moreover, the legislation stated that the generated funds would be directed to agencies like the State Securities Department, the Attorney General’s office, and the Department of Energy and Environment. These agencies would use the funds for personnel services and operating expenses and perform oversight functions over the digital asset mining businesses.

Senator Bryan King spearheads this push, with seven resolutions already securing the requisite two-thirds majority in the Senate.

Miner’s increasing challenge as halving nears

Mining activities haveย attracted significant attention from regulators and lawmakers alike because of their electricity-intensive operations, alleged impact on power grids, and carbon emissions.

Pro-Bitcoin advocates such as the Texas Blockchain Council have advocated for alternative views on Bitcoin mining energy usage, suggesting that Bitcoin miners are a net good for the energy grid due to their ability to tailor and curtail demand, unlike traditional data centers.

So, Arkansas’s legislative move aligns with a broader trend of governments tightening regulations on crypto mining.

Norway, for instance, recently implemented stricter rules for data centers, necessitating registration and detailed disclosure of ownership and services. These rules indirectly impact Bitcoin miners by subjecting them to heightened scrutiny.

Meanwhile, imposing stricter regulations and energy taxes on Bitcoin mining could exert a lasting influence on the network, particularly as it approaches the halving event.

The Bitcoin halving event, expected to occur on April 20, would significantly impact crypto miners because it reduces block rewards to 3.25 BTC. Bloomberg reported that this reduction could lead to a revenue loss of nearly $10 billion annually for the industry.

Posted In: , , Crypto, Regulation