State Leadership Refuses to Learn About the Benefits Blockchain Technology Brings to the State’s Climate Goals

Washington, D.C. – November 26, 2022 – On Friday, Governor Hochul vetoed legislation, A. 9275 (Vanel), S.8343 (Sanders, Jr.), that would establish the New York State Cryptocurrency and Blockchain Study Taskforce, and examine the cryptocurrency and blockchain industries and their financial and environmental impacts. The veto message, which applied to 38 other industry-specific study and/or taskforce-related bills, stated that the “enactment of this package of legislation would collectively cost the state approximately $40 million,” and so, the “proposals would be more appropriately considered in the context of the State budget process.”

This comes on the heels of Governor Hochul approving legislation earlier this week, A.7389-C (Kelles), S.6486-D (Parker), that places a two-year moratorium on digital asset mining operations that use proof-of-work (PoW), behind-the-meter, authentication methods to validate blockchain transactions.

“Governor Hochul’s veto is irresponsible and astoundingly short-sighted,” said Perianne Boring, founder and CEO of the Chamber of Digital Commerce. “In shunning the digital asset community not once, but twice in a week, New York has set a dangerous precedent in determining which industries or businesses may or may not use energy resources. It made this power play by neither fully understanding the role an emerging industry can play in the economic vitality of the state, nor the role it can play in responsible environmental stewardship and energy innovation.”

Although the cryptomining moratorium law requires completion of a standard environmental impact statement by the New York State Department of Environmental Conservation (DEC) within a year of the moratorium’s two-year timeline, it fails to study the implications of blockchain technology, its impact on innovation, competition, regulation, and the state economy, which was the objective of the New York State Cryptocurrency and Blockchain Study Taskforce legislation. 

The Taskforce bill, on the other hand, greatly expanded the environmental impact examination of digital asset mining, including requiring that state DEC officials and representatives from a state or national organization promoting environmental conservation be appointed to the Taskforce. The Taskforce was required to provide data on the energy consumption necessary for digital asset mining operations and other policy considerations related to energy consumption, as well as the environmental impact of digital asset mining operations.

“Though we are incredibly disappointed with the actions taken against the digital asset industry this week, we applaud the sponsors of the New York State Cryptocurrency and Blockchain Study Taskforce, Assemblyman Clyde Vanel and Senator James Sanders, Jr., and thank them for their engagement with mining organizations, and their focus on better understanding our industry, and working to better educate their colleagues and the public,” continued Boring. 

In the weeks ahead, as the Legislative Session approaches, the Chamber urges lawmakers and regulators to work with the industry to learn the benefits of PoW mining, which has spurred economic growth, job creation, and inclusion for historically underrepresented populations in New York and across the globe, while also creating financial incentives for the buildout of renewable energy infrastructure.

The Chamber of Digital Commerce stands ready to educate and work with the state Legislature, the Governor, and regulators to ensure the digital asset community is well-represented and understood for its benefits to the public, the state, and the environment.