New York’s Plattsburgh becomes the first city in the United States to issue a ban on cryptocurrency mining activities in the city for 18 months. The city council universally voted to enact the ban at a council meeting last week.
According to the mayor’s office, the purpose of the law is to contemplate on the regulations before commercial cryptocurrency mining operations result in an irreversible change to the character and direction of the city.
Crypto mining and power consumption
Colin Read, the mayor of Plattsburgh, told Motherboard that the city had the most low-priced electricity rates in the world. He stated that the residents pay around 4.5 cents per kilowatt-hour, while the rest of the country spent an average of 10 cents.
He further explained that Plattsburgh also had an incentive for the industrial enterprises, which only paid 2 cents per kilowatt-hour. This was the reason why cryptocurrency miners turned to use the city as their base for most of their operations since their profits depend on the cheap electricity charges, and mining consumes an astronomical amount of energy.
Motherboard noted that Coinmint runs the most extensive Bitcoin mining operation in Plattsburgh city, and it consumed approximately 10 percent of the total power budget of the town in January and February.
The rise in power usage
Mayor Read projected the moratorium after the residents protested about the increase in their power bills earlier this month. He told Motherboard that he had heard more of complaints that electric bills had risen by about $100 or $200.
Plattsburgh is allocated 104 megawatt-hours of electricity every month. When it went above this allotment in January, the city was forced to buy more expensive power from open market thus causing the price rises.
Office of the mayor states that the new law is also to mean to protect Plattsburgh’s natural, cultural, historical, electrical resources and health as well as the well-being of its residents.
This law by Plattsburgh will take effect when Read approves it and files with the New York secretary of state. Officials and the residents of the city will work together with local cryptocurrency miners during the next 18 months while overseeing the power issues.