Arkansas Moves One Step Closer To Passing Crypto Mining Bill

Miners would be classified as data centers according to a new Arkansas bill, as legislation aims to prohibit “discrimination” against digital asset mining

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The state and House in Arkansas have passed a bill to protect miners from discrimination in a move that stands out as other states move against mining. 

The Arkansas Data Centers Act of 2023 would protect miners as data centers and “clarify the guidelines needed to protect data asset miners from discriminatory industry-specific regulations and taxes.”

The legislation acknowledged that “guidance for future industry growth is needed in Arkansas to protect Arkansans from fraudulent business practices.”

Senator Joshua Bryant proposed the bill on March 30. It now goes to Governor Sarah Huckabee Sanders for signing. 

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In February, Montana’s Senate also passed a bill aimed to protect crypto miners. The bill has not yet formally passed, as it awaits a House of Representatives vote, but the concept is similar to what Arkansas legislators proposed. 

“Digital asset mining provides positive economic value for individuals and companies throughout the United States,” the bill states. It also says that crypto mining facilities should fall under data centers. 

Both Montana and Arkansas have acknowledged that taxes should not be “discriminatory” against mining. 

“Digital assets used as a method of payment may not be subject to any additional tax, withholding, assessment, or charge by the state or a local government that is based solely on the use of the digital asset as the method of payment,” the Montana bill proposal states.

The Arkansas and Montana bills “focus on the benefits” of bitcoin miners, including how mining can bring “jobs and tax revenue” as well as boost the “economic value in communities,” said Sam Callahan, lead analyst at Swan Bitcoin. 

Other states are aiming to crack down on mining, however.

Texas Senate Committee on Business and Commerce unanimously passed Texas Senate Bill 1751, which places new restrictions on crypto mining facilities. Specifically, the legislation would require miners to register as flexible load operators with the Electric Reliability Council of Texas (ERCOT). 

The proposal now moves to the Senate, though it faces public opposition

Read more: Riot Platforms Pushing Back Against ‘Misguided’ Texas Mining Bill

“Bitcoin miners compete in various ancillary services which ERCOT uses to compensate [for] flexible loads to ensure grid stability. The entrant of bitcoin miners has made the bidding process more competitive, reducing prices,” wrote Parker Lewis in an open letter to Senator Lois Kolkhurst — the legislator who co-sponsored the bill.

Governor Greg Abbott has been a vocal supporter of mining and has taken efforts to make the Lone Star state crypto friendly. Republican Senator Ted Cruz has also been supportive, saying that miners operating on the power grid — which has faced backlash after multiple instances of blackouts during winter storms and heatwaves — could help stabilize it.

“I am an enthusiastic fan of bitcoin,” Cruz said at the Texas Blockchain Summit 2022. He also thanked the attendees for modernizing energy and “strengthening the resiliency of the [energy] grid.”

Meanwhile, a county in North Carolina is mulling a moratorium on bitcoin mining operations to develop “a new Comprehensive Plan which seeks to develop standards and mitigation methods for intensive land uses that may pose detrimental harm to the natural environment, and the County seeks time to develop standards.”

Each bill is at a different stage of the process, though none have been passed yet.


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