Arkansas recently joined the ranks of other US states in passing a bill that seeks to regulate Bitcoin (BTC) mining. Arkansas data center law 2023 has successfully passed both the House and Senate and is currently awaiting final approval from Governor Sarah Huckabee Sanders.
The law seeks to set guidelines for bitcoin miners and protect them from “discriminatory regulations” and taxes, ensuring they have the same rights as data centers.
What are the main guidelines for the Bitcoin mining bill?
Subchapter 5 of the adopted draft law establishes several definitions important for understanding the legislation. This subchapter defines “mining of digital assets” as the use of electricity to power computers to secure or validate the blockchain network, and “miner of digital assets” as an individual who engages in this activity.
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The bill also includes definitions of other terms related to digital assets, such as “digital assets” and “blockchain network.” Moreover, he defines “digital asset mining business” as a group of computers running in a single location that consumes more than one megawatt (1 megawatt) per year to create digital assets by securing the blockchain network.
In addition, the Act sets out requirements that digital asset miners must meet to operate in the state, including compliance with state and federal laws, payment of applicable government taxes and fees, and operating in a manner that does not cause “stress” on electricity. Generating capabilities of a utility or transmission network.
It also deals with the mining of home digital assets, allowing individuals to use a node in their residence for this purpose, subject to applicable facility rules and rates. In addition, the law makes it clear that a person may have a digital asset mining business in an area designated for industrial use that the local government has not designated for other uses.
To protect bitcoin mining from ‘discriminatory regulations’
To protect bitcoin mining businesses from “discriminatory regulations” and taxes, the law includes provisions prohibiting discrimination against businesses mining digital assets. Specifically, it states that a digital asset mining company may operate in a state if it complies with state law relating to business guidelines and tax policies, any ordinance relating to operations and safety, and federal and state employment laws.
This will help ensure that the bitcoin mining business is not subject to regulations or taxes that could hinder the growth or development of this important segment of the emerging crypto industry, at least in the state of Arkansas.
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Overall, the digital asset mining business guidelines outlined in the Arkansas Data Center Act of 2023 are designed to provide clarity and protection to the industry, while ensuring that digital asset miners operate in a responsible and sustainable manner.
As of this writing, Bitcoin’s trading range has held steady at $28,200 and has seen a slight increase of 1% over the past 24 hours.
BTC is trading sideways on the 1-day chart. Source: BTCUSDT on TradingView.com
Featured image from Unsplash, chart from TradingView.com