Arkansas legislators engaged in a historic debate on Thursday, marking the first formal consideration of two bills aimed at regulating cryptocurrency mining within the state.
In a session chaired by the Senate City, County, and Local Affairs Committee, probing inquiries were directed at the sponsors, Senator Missy Irvin of Mountain View and Senator Joshua Bryant of Rogers, before both bills were advanced.
The proposed legislation seeks to amend aspects of Act 851 from 2023, which currently bars local authorities from enacting specific ordinances pertaining to crypto mines, among other limitations. Additionally, the bills designate Arkansas’ crypto mining surge as an “emergency,” reflecting the pressing need for regulatory intervention.
One of the bills, sponsored by Irvin and Representative Jeremiah Moore of Clarendon, introduces noise regulations, mandates soundproofing measures, prohibits the use of water for cooling servers in crypto facilities, and restricts ownership by individuals from countries listed in the International Traffic in Arms Regulations.
The second bill, championed by Bryant and Representative Rick McClure of Malvern, also emphasizes soundproofing requirements, stipulates a minimum distance from neighboring structures, and imposes similar limitations on foreign nationals outlined in the International Traffic in Arms Regulations. Notably, it extends protections to individuals conducting cryptocurrency mining as a hobby within their residences.
Senators Irvin and Bryant underscored their collaborative efforts to ensure alignment between the two bills, particularly regarding restrictions on foreign ownership.
During the committee deliberations, insights were provided by John Bethel, Entergy’s Director of Public Affairs, highlighting proposed constraints on crypto mines’ electrical consumption and their impact on the state’s power grid.
Expressing apprehensions about water usage, Ken Graves, Chairman of the Arkansas Rice Growers’ Association, and irrigation consultant Jerry Lee Bogard emphasized concerns over the strain crypto mining imposes on the aquifer.
The discourse delved into various facets, including the proximity of crypto mining facilities to military installations, the efficacy of penalties for energy consumption violations, concerns regarding foreign ownership, and potential ramifications on utility services for farmers.
Several senators exhibited a nuanced stance, with Senator Gary Stubblefield questioning the inherent value of crypto mining operations, countered by Senator Dan Sullivan’s recognition of Arkansas’ crypto investors and their potential economic contributions.
The legislative journey leading to this pivotal moment has been intricate. As the General Assembly convened during a fiscal session primarily focused on budgetary matters, additional procedural steps were necessary for the bills’ introduction and consideration.
Arkansas, with its advantageous landscape of abundant land and inexpensive electricity, has emerged as a favored destination for crypto mining ventures. However, Act 851’s swift enactment last year faced mounting criticism, prompting the current push for comprehensive regulatory frameworks.
While only two bills advanced through the House and Senate resolutions, sponsored by Representative Joshua Miller and Senator Bryan King respectively, the broader discourse surrounding crypto mining regulation underscores the multifaceted considerations at play.
As Arkansas navigates the complexities of crypto mining regulation, the deliberations signal a pivotal juncture in shaping the state’s stance on this rapidly evolving industry.
