Embrace crypto for NY’s economic benefit

New York has always been an engine of economic and technological development, fueling the growth and prosperity of the United States. However, the ongoing debate over the future of the state’s cryptocurrency industry threatens to stall what will likely be a major driver of that growth for decades to come.

To capitalize on and fuel this growth, state legislatures must create a regulatory environment that nurtures the industry, rather than blindly snuffing it out.

In a recent article Fortune noted that New York City is on track to become “America’s cryptocurrency capital” because of an impressive and growing number of crypto companies and projects that are headquartered there. This industry promises massive investments and well-paying jobs for New Yorkers in every corner of the state. But you’d never know if you walked the halls of the State Capitol.

For example, state legislatures are considering a two-year period moratorium on proof-of-work crypto mining projects in New York. Laws like these send a terrible signal to crypto entrepreneurs and would have a chilling effect on the growth of the industry in our state. For all intents and purposes, it is a forever ban on this type of mining in the state. Entrepreneurs and investors are unlikely to wait two years in the potentially vain hope that lawmakers will come to their senses and adopt crypto later.

They will move their investments, their projects, and their current and potential employees to other, more welcoming jurisdictions. New York cannot be a crypto capital if our legislature bans a core area of ​​the industry.

Proponents of the bill believe that crypto mining projects, especially those using proof-of-work methods, are harmful to the environment and consume too much energy at a time of rising prices. While we share their desire to curb emissions and get energy prices under control, they would be wrong to portray crypto as the boogeyman or primary driver of this problem in the state.

First, their environmental arguments miss important realities. While mining requires a significant amount of energy, nearly two-thirds of the energy used in crypto mining in the US comes from renewable sources. according to Cambridge University Research. In addition, other key industries – including the traditional financial sector – are used far more energy as crypto. But they don’t see state lawmakers rushing to enact a two-year moratorium on Wall Street.

Importantly, we are objective about the situation: proof-of-work mining is not going to be outright banned in the United States.

When New York closes the door on crypto mining, those operations will move elsewhere, creating high-paying jobs for citizens of other states and allowing those projects to operate under less stringent environmental standards than they otherwise would if allowed to stay. Is it logical to keep these industries in jurisdictions with the greatest environmental control, rather than pushing them to places where they can consume and pollute with relative impunity?

Fortunately, many of our local leaders rightly acknowledge that the growth of crypto will help ensure New York’s economic prosperity in the years and decades to come. Mayor Eric Adams boldly declared that New York City “will be the center of the cryptocurrency industry,” and Rep. Richie Torres, a Bronx Democrat, wrote a comment Highlighting how crypto can help bring marginalized communities into the broader financial system. But their voices alone are not enough to change the winds of misinformation blowing down the Hudson.

Right now, some lawmakers and crypto opponents are failing to grasp or willfully ignore the impact crypto can have on everyday New Yorkers. Crypto and blockchain technology are giving financial power to unbanked populations, driving down costs for businesses of all sizes, returning power to the individual, and curbing the impact of big tech—to name just a few. Rather than focusing on one aspect of crypto based on misinformation, lawmakers should take a more holistic view of the current and future real-world benefits of this new innovation.

legislation (A.9275/p.8343) to do just that is under consideration in both the Senate and the Assembly. Sponsored by Rep. Clyde Vanel and Sen. James Sanders, both Queens Democrats, it would set up a task force made up of representatives from state regulators, academia, financial services, the blockchain industry, and yes, environmental protection. The goal of this taskforce is to take a comprehensive look at the benefits and implications of crypto and blockchain in New York and make informed recommendations to the legislature on how to craft sensible regulation that best positions New York to truly be the crypto capital to become the world .

New York has long been a beacon of innovation and economic growth, and if we embrace crypto today, we will secure the state’s rightful place to be a global leader. Misguided legislation in Albany, however, could derail that progress and cede New York’s supremacy to other cities, states, and countries. This is a generational moment Let’s make the right choice.

John Olsen leads the Blockchain Association’s outreach and advocacy strategy in upstate New York.

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