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NY City Mayor Eric Adams Talks Down Bitcoin (BTC) Mining

By:
Bob Mason
Updated: Feb 10, 2022, 13:28 GMT+00:00

New York City Mayor Eric Adams talks down crypto mining. It remains to be seen whether there is any impact on aspirations to become a center of innovation.

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New York City Mayor Eric Adams is no stranger to the crypto news headlines. In January, New York City Mayor Eric Adams confirmed that he will take a Bitcoin (BTC) salary for his first 3 pay checks.

At the time, Bitcoin had fallen back from a November ATH $68,979 to sub-$33,000 levels before a partial recovery to $40,000 levels.

The NYC Mayor had first pledged to take a Bitcoin salary while running for office. This had been during Bitcoin’s extended bull run that culminated in 10th November’s ATH.

Progressive Crypto States and Bitcoin Mining Clash

Since China’s blanket ban on Bitcoin mining last summer, the United States has become the largest Bitcoin mining nation by hashrate.

According to Cambridge Centre for Alternative Finance, the U.S accounted for 35.4% of the global Bitcoin hashrate back in August 2021. Looking back to the pre-China ban, the U.S hashrate had been just 16.8% in April 2021.

After a period of silence, Bitcoin mining has come under increased scrutiny, however. An energy crisis in Eastern Europe, leading to the ban of crypto mining, may have forced the hand of the U.S government.

In January, a U.S Congress sub-committee held a hearing on crypto mining and its impact on the environment. The focus was on Proof-of-Work protocols and Bitcoin mining in particular.

Some alarming statists had done the rounds and were shared in the hearing briefing. For lawmakers, the statistics were enough to go against Proof-of-Work miners and favor Proof-of-Stake miners.

For the Biden administration, the statistics suggested that Bitcoin mining alone could scupper emission goals set out after taking office.

U.S Administration Environmental Goals

President Joe Biden announced a new target for the U.S “to achieve a 50-52% reduction from 2005 levels in economy-wide net greenhouse gas pollution in 2030”. Upon taking office, President Biden re-joined the Paris Agreement, aiming to tackle the climate crisis both domestically and abroad. The U.S has a goal of reaching net zero emissions by 2050.

Some key statistics to discussed at the crypto mining hearing included:

  • A single ETH transaction added more than 90 pounds of CO2 to the atmosphere, while a single BTC transaction added more than 1,000 pounds.
  • The global 2021 CO2 emissions of ETH and BTC mining are equivalent to tailpipe emissions from more than 15.5m gasoline-powered cars on the road every year. Bitcoin accounted for 90% of that.

With the statistics dooming the administration to failure, even tax agencies stepped in. Since the hearing, the U.S Inland Revenue Services even took aim at Bitcoin miners last week, in favor of Proof-of-Stake protocols.

New York City Mayor Adams Tows the Party Line on Bitcoin Mining

Following last month’s sub-committee hearing and President Biden’s emissions aspirations, the NYC Mayor appears to have towed the party line. Advocating Bitcoin mining at a time of scrutiny would show dissent.

At a local government budget hearing, Adams reportedly voiced his opposition to crypto mining this week. For New York City and its aspirations to be a center of innovation, however, talking down Bitcoin mining may raise questions.

Mayor Adam’s position on Bitcoin mining could also test support for the CityCoins program.

Powered by Stacks (STX), CityCoins is “a protocol that enables smart contracts on the Bitcoin network”. Miners can forward STX into the Stacks protocol. CityCoins miners receive 70% of all stacked STX tokens in NewYork Coin (NYC Coin). Miners can then mine with the rewarded NYC Coin to then earn BTC rewards. In the world of CityCoins, miners would include residents of NYC and city officials.

The remaining 30% goes to City Wallets. City Wallets are considered the same as a city’s treasury. Mayor Adams can either exchange the accrued tokens for fiat or mine the STX tokens to earn Bitcoin.

For those who believe that Bitcoin mining is not environmentally damaging, CoinShares published a research paper just last week. The statistics were vastly different from figures floated by the government.

For NYC, Coinshares’ research suggested that Wall Street may be more harmful to President Biden’s environmental aspirations than Bitcoin mining.

About the Author

Bob Masonauthor

With over 20 years of experience in the finance industry, Bob has been managing regional teams across Europe and Asia and focusing on analytics across both corporate and financial institutions. Currently he is covering developments relating to the financial markets, including currencies, commodities, alternative asset classes, and global equities.

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