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Unintended Consequences (Editorial)

2 min read

Cryptocurrency mining has brought businesses to Arkansas that employ people and broaden the tax base, and there is the potential for greater development of the sector in the state. But caution is called for.

As Kyle Massey’s story this week shows, the mines also bring potential harm in the form of noise, excessive power use and questions about their ownership, including foreign ownership.

Local governments should have the power to address their citizens’ concerns about crypto-mining businesses, but Act 851 of 2023 makes that difficult. The law, which takes effect Aug. 1, prohibits “discrimination” against cryptocurrency mining operations. Businesses “want to make sure that local zoning laws don’t increase, which therefore would cause them to have to cease operations or  change how they do business,” state Sen. Joshua Bryant, R-Rogers, a sponsor of the bill that became Act 851, told a Senate committee meeting.

Bryant and state Rep. Rick McClure, R-Malvern, the other sponsor, argued that the measure would allow for the future growth of cryptocurrency mining operations.

But the act bars a local government from limiting “the sound decibels generated from home digital asset mining other than the limits set for sound pollution generally.” Unfortunately, crypto mines can be noisy.

Some city and county governments say that the law will prevent them from regulating commercial crypto mines. Transparency surrounding ownership of the mines is also an issue. Some officials are calling for a special legislative session to rescind or alter the law.

Encouraging businesses is a worthy goal, but many uncertainties still surround crypto mining and Act 851 hamstrings local governments.

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