Crypto Mining Restrictions: Arkansas Lawmakers Approve New Bills To Regulate Sector

Over the last couple of years, the US government has tried to tighten its grip on different sectors of the crypto industry. As a result, these efforts have received significant backlash from politicians and central figures within the crypto space.

This week, another crackdown on the crypto industry occurred after Arkansas lawmakers approved two bills to address criticism over previous regulations on mining operations.

New Crypto Mining Regulations In Arkansas

News media outlet The Associated Press (AP) reported on Wednesday that Arkansas’ House of Representatives gave final approval to two bills related to crypto mining operations in the state.

The two Senate-backed bills, SB78 and SB79, were among the few non-budget subjects on the legislative session’s agenda and were “overwhelmingly approved” by the majority Republican House. They are on their way to Republican Governor Sarah Huckabee Sanders’s desk.

Last year, Arkansas lawmakers faced backlash after approving the Arkansas Data Centers Act of 2023. The approved Act 851 set an overall favorable regulatory ground for crypto miners in the state, establishing clear definitions and guidelines.

As Bitcoinist reported, the act included provisions prohibiting discrimination against digital asset miners. Moreover, it sought to protect crypto mining businesses from “discriminatory regulations” and ensure their equal treatment as data centers.

Act 851 was criticized for limiting the local government’s ability to enact measures to regulate mining businesses. Now, Arkansas’ Senate and House of Representatives intend to address the complaints of last year’s Act with the newly approved bills.

These bills tackle the backlash from local officials and residents who live near the operations, who complained about the noise impact on the community. As a result, the lawmakers added the requirement for noise-reduction techniques and a state permit to operate.

Additionally, the two bills addressed water usage restrictions for cooling techniques and removed the limitation to regulate the sound decibels generated by mining facilities. Republican Representative Rick McClure stated:

Let’s do what we can to help those who have been impacted in a negative way, and work for better solutions.

Moreover, the approved bills prohibit the ownership of crypto mining businesses by companies and individuals from several countries, including China.

Nonetheless, it continues to restrict the regulatory power of local authorities over matters like home mining from individuals or rezoning areas where crypto mining businesses are located.

Gov. Sanders To Sign The Bills Despite Concerns

According to AP, one of the Representatives who voted against the bills, democrat Andrew Collins, stated his concern about the wording of the limit and the impact it could have on foreign investment:

We’re casting a net that is both too wide and too narrow. It’s going to catch people up who are totally innocent, and it’s going to miss a lot of people who are either home-grown or are from countries not on this list.

Representative Justin Gonzalez also voted against the bills. During an interview on Wednesday, he expressed his opinion on the matter. To the representative, the bills will “allow local governments to discriminate against a business just because of what it is.”

According to Arkansas Advocate reports, Gonzales doesn’t believe the Act needed to be amended despite not having a problem with the language used to address the foreign ownership issue.

Regardless of the opposition concerns, the bills are expected to be approved by the Arkansas governor. Alexa Henning, Sanders’ spokesperson, stated in an email that both bills will be signed, further alleging adding that:

The Governor was the first in the country to kick a Chinese communist owned company out of her state and strongly supports outlawing foreign adversaries from owning crypto mines in Arkansas, while protecting rural communities and empowering them to crack down on bad actors.