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Landmark bill to limit cryptomining passes NY Legislature

ALBANY, N.Y. — New York lawmakers have passed a milestone environmental measure designed to tap the brakes on the spread of cryptocurrency mining operations that burn fossil fuels.

Both supporters and opponents say that the closely watched bill, approved early Friday by the state Senate, is the first of its kind in the U.S.

If it becomes law, it would establish a two-year moratorium on new and renewed air permits for fossil fuel power plants used for energy-intensive “proof-of-work” cryptocurrency mining — a term for the computational process that records and secures transactions in bitcoin and similar forms of digital money. Proof-of-work is the blockchain-based algorithm used by bitcoin and some other cryptocurrencies.

Environmentalists are urging Gov. Kathy Hochul to sign the legislation. They say the state is undermining its long-term climate goals by letting cryptomining operations run their own natural gas-burning power plants.

“We cannot be re-powering fossil fuel power plants for the purposes of private gain in New York, especially as we’re looking to move away from fossil fuels entirely,” said Liz Moran of Earthjustice.

Dozens of fossil fuel plants in New York could potentially be converted into mining operations, she said.

Cryptocurrency advocates complained that the measure singled out the industry without addressing other fossil fuel use. They argue that the legislation would crimp economic development in New York while other states court the burgeoning field.

“The message from the bill and the embrace of that kind of policy is not a good one for an industry that really can go anywhere,” said John Olsen of The Blockchain Association, an industry group.

“We’re very hopeful that the governor realizes that the long-term benefits of embracing this industry and this technology far outweigh a potential pause on prospective future emissions,” he added.

Hochul, a Democrat, has said she want to make sure any legislation balances economic and environmental concerns

Cryptocurrency mining requires specialized computers that consume huge amounts of energy. One study calculated that as of November 2018, bitcoin’s annual electricity consumption was comparable to Hong Kong’s in 2019, according to the U.S. Energy Information Administration. Some miners are looking for ways to reduce their reliance on fossil fuels to produce the necessary electricity.

A coalition of environmental groups has separately been urging the Hochul administration to deny the air permit renewal for Greenidge Generation in the Finger Lakes, which also produces power for the state’s electricity grid. A decision could come at the end of the month.

The moratorium measure, if signed into law, would not affect pending applications, such as the one from Greenidge.

The measure also would require the state Department of Environmental Conservation to perform an environmental impact assessment on how cryptomining affects the state’s ability to meet its climate goals.

The bill passed the Assembly, the Legislature’s lower chamber, in April.

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Associated Press writer Jennifer Peltz contributed from New York City.


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Landmark bill to limit cryptomining passes NY Legislature

ALBANY, N.Y. — A milestone environmental measure designed to tap the brakes on the spread of cryptocurrency mining operations burning fossil fuels in New York has passed the state Legislature.

The closely watched bill approved early Friday by the state Senate would establish a two-year moratorium on new and renewed air permits for fossil fuel power plants used for energy-intensive “proof-of-work” cryptomining. Proof-of-work is the blockchain-based algorithm used by bitcoin and some other cryptocurrencies.

The bill, which supporters say is the first of its kind, now goes to Democratic Gov. Kathy Hochul for consideration. The governor has said she want to make sure any legislation balances economic and environmental concerns.

Environmentalists who lobbied for the bill said natural gas-burning power plants being used for cryptomining operations threaten the state’s ability to meet is long-term climate goals.

“Governor Hochul signing this legislation sends a signal that New York state is serious about meeting its climate mandates. It shows us that we cannot be re-powering fossil fuel power plants for the purposes of private gain in New York, especially as we’re looking to move away from fossil fuels entirely,” said Liz Moran of Earthjustice.

Moran said there are potentially dozens of fossil fuel plants in New York that could be converted into mining operations.

Supporters of the cryptocurrency industry said the measure would crimp economic development in New York. The Blockchain Association, an industry group, said it would simply prompt mining operations to move to other states.

Cryptocurrency mining requires specialized computers that consume huge amounts of energy. One study calculated that as of November 2018, bitcoin’s annual electricity consumption was comparable to Hong Kong’s in 2019, according to the U.S. Energy Information Administration. Some miners are looking for ways to reduce their reliance on fossil fuels to produce the necessary electricity.

A coalition of environmental groups has separately been urging the Hochul administration to deny the air permit renewal for Greenidge Generation in the Finger Lakes, which also produces power for the state’s electricity grid. A decision could come at the end of the month.

This measure, if signed into law, would not affect pending applications like the one from Greenidge.

The measure also would require the state Department of Environmental Conservation to perform an environmental impact assessment on how cryptomining affect the state’s ability to meet its climate goals.

The bill passed the Assembly, the Legislature’s lower chamber, in April.


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Bitcoin tumbles, a stablecoin plunges in wild week in crypto

NEW YORK — It’s been a wild week in crypto, even by crypto standards.

Bitcoin tumbled, stablecoins were anything but stable and one of the crypto industry’s highest-profile companies lost a third of its market value.

Here’s a look at some major developments in cryptocurrencies this week:

BITCOIN

The price of bitcoin dropped to around $25,420 this week, its lowest level since December 2020, according to CoinDesk. It steadied around $30,000 Friday, but that’s still less than half the price bitcoin fetched last November.

Other cryptos have fared just as poorly. Ethereum has dropped 44% and dogecoin, a cryptocurrency favored by Tesla CEO Elon Musk, has lost about half its value.

STABLECOIN COLLAPSE

Stablecoins have been viewed as a safe harbor among cryptocurrencies. That’s because the value of many stablecoins is pegged to a government-backed currency, such as the U.S. dollar, or precious metals such as gold.

But this week one of the more widely used stablecoins, Terra, experienced the cryptocurrency equivalent of a run on the bank.

Terra is a stablecoin in a cryptocurrency ecosystem known as Terra Luna. Terra is an algorithmic stablecoin, which means its supply is adjusted through complicated buying and selling to keep its peg to $1. Terra was also fueled by an incentive program that gave its holders high yields on their Terra. Luna was the coin meant to be used in the ecosystem to buy and sell assets, and at its peak it was worth more than $100.

Even though the developers of Terra said its algorithms would backstop the stablecoin, they decided to further backstop it with holdings of bitcoin.

Terra’s problems started from a combination of withdrawals of hundreds of millions, perhaps billions, of dollars from Anchor, a platform that supported the stablecoin. Combined with worries overall about cryptocurrencies, and the drop in bitcoin’s price, Terra started to lose its peg to the dollar. The bitcoin that Terra held was also worth less than they paid for it, and selling those bitcoin into the market caused bitcoin prices to fall even further.

Efforts by Terra’s developers to shore up liquidity failed. On Friday, Terra had fallen to 12 cents and Luna was trading at a value of less than one ten thousandth of one cent.

COINBASE

Coinbase lost about a third of its value this week, during which the cryptocurrency trading platform reported that active monthly users fell by 19% in the first quarter amid the decline in crypto values.

Investors had been running for the exits even before Coinbase reported a $430 million quarterly loss. Shares closed Friday at $67.87. On the day of its initial public offering just 13 months ago, shares reached $429 each.

In a letter to shareholders, Coinbase said it believed that current market conditions were not permanent and it remained focused on the long-term while prioritizing product development. While most Wall Street analysts expect Coinbase to weather the storm, they’re also warning that increased regulation of cryptocurrencies could hamper the company’s growth.

REGULATORS

There has been a lot of talk about regulating cryptocurrencies, but little in the way of action.

Treasury Secretary Janet Yellen, responding to the volatility in the crypto markets this week, said Thursday that the U.S. needs a regulatory framework to guard against the risks surrounding cryptocurrencies and stablecoins.

In March, Federal Reserve Chair Jerome Powell said new forms of digital money such as cryptocurrencies and stablecoins present risks to the U.S. financial system and will require new rules to protect consumers. This Monday, right before the implosion of Terra, the Fed said in its semiannual report on financial stability that stablecoins are vulnerable to “runs” that could harm owners of the coins.

Securities and Exchange Commission Chairman Gary Gensler has said that the crypto industry is “rife with fraud, scams and abuse” and that his agency needs more authority from Congress — and more funding — to regulate the market.

Britain has unveiled plans to regulate stablecoins as part of a broader plan to become a global hub for digital payments. European Union lawmakers have agreed on draft rules for cryptoassets, but still have to negotiate a final bill.

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AP Economics Writer Christopher Rugaber and AP Technology Write Michael Liedtke contributed.


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Biden executive order on cryptocurrency expected this week

President Joe Biden is expected to sign an executive order on cryptocurrency this week that will mark the first step toward regulating how digital currency is traded

Two people familiar with the process said the executive order on cryptocurrency was expected to be issued this week and it had been in the works long before the war. Both people spoke on condition of anonymity to preview the order.

The order is expected to describe what government agencies, including the Treasury Department, need to do to develop policies and regulations on digital currencies. It is expected to include a request for the State Department to ensure that American cryptocurrency laws are aligned with those of U.S. allies and will ask the Financial Stability Oversight Council — which monitors the stability of the U.S. financial system — to study illicit finance concerns.

Additionally, the order will explore the possibility of a new central bank digital currency. The Federal Reserve issued a paper on the topic in January that explores the risks and benefits of U.S.-backed digital currency.

Implicit in the order will be that cryptocurrency will remain a part of the U.S. economy for years to come. The White House’s plans to move forward with the executive order were first reported by Bloomberg News.

While U.S. officials have played down the significance of cryptocurrency to Russia’s ability to evade sanctions, it remains a concern.

“We will continue to look at how the sanctions work and evaluate whether or not there are liquid leakages and we have the possibility to address them. I often hear cryptocurrency mentioned and that is a channel to be watched,” Treasury Secretary Janet Yellen said last week.

A senior administration official who spoke on condition of anonymity said the president’s national security team has already been on the lookout for the use and creation of front companies and alternative financial institutions that Moscow might try to employ to get around sanctions.

Crypto is one of several spaces that the Biden administration is looking to shore up as it tries to make certain that sanctions on Russia have maximum impact. The official said past experiences in Iran and Venezuela with sanctions evasion are informing the administration’s efforts. Additional export controls and new sanction targets are also expected to be unveiled in the days and weeks ahead to counter Russian sanction evasion efforts, the official said.

On Monday, Treasury’s Financial Crimes Enforcement Network issued an alert advising financial institutions to be “vigilant” against any efforts to evade sanctions in connection with Russia’s war in Ukraine.

“Although we have not seen widespread evasion of our sanctions using methods such as cryptocurrency, prompt reporting of suspicious activity contributes to our national security and our efforts to support Ukraine and its people,” Acting Director Him Das said in a statement.


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How to buy, trade cryptocurrency beginners guide

There are countless coins, and even more ways to buy and sell them. So how do you get started? We had an expert weigh in.

Cryptocurrency has taken Australia by storm.

More than 20 per cent of adults across the country are thought to own some form of crypto, and rises and falls in the market regularly make for big news.

But with so many options for coins to invest in, and wallets to trade out of, it’s hard to know how to get started.

Comparison website Finder has crunched the numbers to find the best of the best exchanges, with the aim of making the hi-tech currency accessible for everyday Australians.

An exchange is a platform on which you can buy and sell cryptocurrency. They can be used to buy crypto with regular currency or convert crypto back to a dollar value – essentially they reflect the market price of cryptocurrency.

But, much like the coins, there are hundreds of exchanges; some fantastic and legitimate, and others … not so much.

Best exchange for beginners

Crypto expert James Edwards is one of many who reaped the rewards from the new technology.

He bought half a Bitcoin in 2014 for around $350, that same amount of Crypto is now worth about $30,000.

The self-described ‘nerd’ now works researching cryptocurrency for Finder, which has designed an awards system to help simplify information for those just wanting to learn more about the currencies.

According to the review site, Crypto.com was rated the best exchange for beginners.

“The awards were based on a range of criteria rather than someone or some people just picking. For example, Crypto.com scored highly because they have a good smartphone application, it’s easy to use, good customer support and you can set up recurring payments,” he told news.com.au.

“Another thing we wanted to do was only rank companies that are registered with AUSTRAC.”

Binance won three awards, including Exchange for Features and Exchange for Altcoins, as well as the award for Australian cryptocurrency Exchange (Overall).

Crypto.com won the category ‘Exchange for Beginners’, while Kraken won ‘Exchange for Trading’.

Meanwhile the award for ‘Exchange for Value’ went to Digital Surge, with CoinJar and Crypto.com a close second.

How to invest in cryptocurrency

Mr Edwards recommends for those wanting to dip their toes into Crypto should try the dollar-cost averaging method as their investment strategy.

This method theoretically helps prevent the massive highs and lows of the sometimes volatile coins.

“To do this, you need to set aside a certain amount of money and invest it at the same time each week. For example, you pick a time on a Friday morning where you invest $50 into coins,” he said.

“This helps take the emotion out of your investments, as it is just something you do each week. But it really just works in removing any timings related to the market, you’re not chasing the lows.”

What cryptocurrency to invest in?

With thousands, if not millions, of cryptocurrencies on the market, it can be intimidating to get started.

The most popular coins are Bitcoin, Ethereum, Tether and Binance which are all a solid starting point for your investments.

Mr Edwards identified Ethereum as a popular first choice with many investors, after Bitcoin

“Ethereum is good as it can be described as a layer of the internet, not just a currency. Ethereum is a popular first choice with many investors, after Bitcoin” he said.

“The next, or latest, version of the internet is called Web 3. This is going to be based on things like Eth. The Crypto is allowed to hold computer code and creates this hyper-secure layer which was previously very difficult on the internet.

“The layer of security enables people to be confident with the finances and financial services.”

He added to be wary of things that are too good to be true.

“For people just starting out, the best thing you can do is read and learn from reputable sources. What is really important is looking at who is providing the information and whether they are influencers or have something to gain from you buying their product,” he said.

Finder’s head of consumer research, Graham Cooke, said Australia’s enthusiasm for cryptocurrency has driven its growth.

“Cryptocurrency awareness in Australia is among the highest in the world. 85 per cent of Aussies say they know what cryptocurrency is, much higher than countries like the United States (59 per cent) and the United Kingdom (55 per cent),” he said.

It comes as ‘meme coin’ Shiba Inu rockets in value.

The surge comes amid a broad recovery in crypto with Bitcoin’s value going up to just under US$44,000 (A$61,000) and Ether’s price now at US$3,100 (A$4300).

SHIB tokens surged to $0.0000342 from the $0.000022 over the last day while Dogecoin jumped to $0.1661 from $0.145. Both SHIB and Dogecoin were based off popular internet memes.

The move caused nearly $10 million in losses to liquidations for traders of SHIB-tracked futures products, according to Coin Desk.

After becoming one of the dominant meme currencies of 2021, Shiba Inu’s value had been on a downward trend for the most part since late October.

On October 28 last year, Shiba hit an all-time high of $0.00008845.


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