The state of Arkansas has recently joined the ranks of other US states in passing a bill that seeks to regulate Bitcoin (BTC) mining. The Arkansas Data Centers Act of 2023 has successfully passed through both the House of Representatives and Senate and is currently awaiting the final approval of Governor Sarah Huckabee Sanders.
The Act seeks to establish guidelines for Bitcoin miners and protect them from “discriminatory regulations” and taxes, ensuring that they have the same rights as data centers.
What Are The Key Guidelines For The Bitcoin Mining Bill?
Subchapter 5 of the approved bill, outlines several definitions that are important for understanding the legislation. This subchapter defines “digital asset mining” as the use of electricity to power computers to secure or validate a blockchain network, and “digital asset miner” as an individual who engages in this activity.
Related Reading: Bitget Exchange Launches $100 Million Fund For Web3 Startups In Asia
The bill also includes definitions for other terms related to digital assets, such as a “digital asset” and “blockchain network. Furthermore, it defines “digital asset mining business” as a group of computers working at a single site that consumes more than one megawatt (1 MW) annually to generate digital assets by securing a blockchain network.
Additionally, the Act outlines the requirements that digital asset miners must meet to operate in the state, including compliance with state and federal laws, payment of applicable taxes and government fees, and operating in a manner that does not cause “stress” on the electric public utility’s generation capabilities or transmission network.
It also addresses home digital asset mining, allowing individuals to use a node at their residence for this purpose, subject to applicable utility rules and rates. Additionally, the Act clarifies that a person may have a digital asset mining business in an area that is zoned for industrial use that has not been designated by the local government for other uses.
To Protect Bitcoin Mining From “Discriminatory Regulations”
To protect Bitcoin mining businesses from “discriminatory regulations” and taxes, the Act includes provisions that prohibit discrimination against digital asset mining businesses. Specifically, it states that a digital asset mining business may operate in the state if it complies with state law concerning business guidelines and tax policies, any ordinance concerning operations and safety, and state and federal employment laws.
This will help to ensure that Bitcoin mining businesses are not subject to regulations or taxes that could hinder the growth or development of this important sector of the nascent crypto industry, at least in Arkansas state.
Related Reading: New Court Filing Shows FTX Kept Crypto Wallet Keys On AWS
Overall, the guidelines for digital asset mining businesses outlined in the Arkansas Data Centers Act of 2023 are designed to provide clarity and protection for the industry, while ensuring that digital asset miners operate in a responsible and sustainable manner.
As of this writing, the trading range of Bitcoin remains steady at $28,200, experiencing a minor increase of 1% within the past 24 hours.
Featured image from Unsplash, chart from TradingView.com
