New York Senator Proposes Legislation to Impose Taxes on High-Energy Crypto Mining Operations in the State

New York State Senator Liz Krueger has put forward a bill aimed at crypto mining operations that utilize significant amounts of electricity, suggesting a tiered excise tax based on yearly energy consumption.

Key Takeaways:

• The proposed legislation in New York would impose a tax on crypto miners of up to 5 cents per kWh, determined by energy usage tiers.
• Mining operations that rely entirely on renewable energy would be exempt from this tax.
• Increasing energy expenses and tighter profit margins may compel miners to exit New York or transition to more sustainable energy sources.

The bill, revealed on Wednesday, aims to levy charges on miners of up to 5 cents per kilowatt-hour (kWh) based on their consumption levels.

New York Bill Suggests Tiered Energy Tax on Crypto Miners According to Usage

According to the proposal, mining companies consuming less than 2.25 million kWh annually would be exempt.

Those using between 2.26 and 5 million kWh would incur a charge of 2 cents per kWh, with higher tiers facing increased rates: 3 cents for up to 10 million kWh, 4 cents for up to 20 million, and 5 cents for those surpassing that limit.

Miners powered solely by renewable energy would be exempt. This aligns with New York’s two-year moratorium on mining operations powered by non-renewable sources, which concluded in 2024, allowing clean-energy operations to persist.

Krueger’s bill comes at a time when mining expenses are escalating. The median cost to mine a single Bitcoin exceeded $70,000 in Q2 2025, influenced by a rise in network hashrate and difficulty, as reported by TheMinerMag.

Energy prices in Q1 2025 averaged approximately $0.08 per kWh, which is double the revenue-to-cost ratio for companies like TeraWulf, which recorded a $61.4 million loss during that period at its facility in upstate New York.

JUST IN: New York introduces anti-bitcoin mining bill that would tax proof-of-work mining pic.twitter.com/CWTjghW8EU

— Bitcoin Archive (@BTC_Archive) October 2, 2025

The tax could further tighten profit margins for miners dependent on retail-priced grid electricity.

Large operators with access to renewable energy infrastructure might be able to absorb the impact or avoid the tax altogether, enhancing their competitive advantage over smaller entities.

Electricity remains the most significant expense in Bitcoin mining. With already narrow margins, the proposed tax may hasten the departure of mining firms from New York to regions with lower costs, unless they shift to clean energy.

The bill highlights New York’s continued examination of the environmental impact of crypto mining as lawmakers consider economic incentives alongside sustainability objectives.

US Lawmaker Calls for National Security Probe Into China-Linked Bitcoin Mining Firms

In September, Congressman Zachary Nunn requested the US Treasury to initiate a national security review of Chinese companies Bitmain and Cango, citing concerns regarding their growing presence in the US crypto mining industry.

In a letter addressed to Treasury Secretary Scott Bessent, Nunn referenced opaque ownership structures, potential state connections, and threats to national infrastructure as reasons for a Committee on Foreign Investment in the United States (CFIUS) investigation.

Bitmain, which controls over 80% of the global Bitcoin mining hardware market, and Nasdaq-listed Cango have both denied any plans for a merger.

Nonetheless, Nunn expressed concerns about their expansion strategies in the US, intricate financing arrangements, and possible involvement in US energy infrastructure.

His apprehensions follow a $300 million equipment agreement between Bitmain’s US division and a mining firm linked to Trump.

Both companies have asserted their compliance with US regulations and denied any affiliations with foreign governments.

However, Nunn contends that the extent of their influence and the sensitivity of energy and crypto markets necessitate closer examination, cautioning that unchecked growth could jeopardize US digital asset sovereignty.

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