Aiming to regulate the Bitcoin mining industry in Arkansas, the State House has passed a bill which had already been approved by the State Senate.
The Arkansas Data Centers Act of 2023 seeks to establish guidelines for Bitcoin miners, preventing fraudulent business practices.
Under the proposed bill, a Bitcoin mining business may operate in the state if it complies with all state laws concerning business guidelines, tax policies, safety regulations, utility service rates, and state and federal employment laws. The miners will be required to pay relevant taxes and government fees in an acceptable form of currency, and operate without putting undue strain on the electric public utility’s generation capabilities or transmission network.
Moreover, the bill permits individuals to conduct home Bitcoin mining as long as they adhere to applicable utility rules and rates. The bill now awaits approval from the governor’s office.
The proposed legislation seeks to acknowledge the contribution of data centers to the economy by generating employment, paying taxes, and adding value to local communities and the state. It aims to provide clear directives to safeguard Bitcoin miners from prejudicial regulations and industry-specific taxes. The bill introduces specific terminology such as “digital asset” to refer to Bitcoin and other cryptocurrencies. Additionally, it provides definitions for “digital asset miner,” which denotes individuals who mine digital assets, and “digital asset mining,” which refers to the utilization of electricity to validate or secure a blockchain network through a computer.
In simpler terms, the proposed bill provides definitions for key terms related to digital asset mining businesses. It explains that a “digital asset mining business” is a group of computers located at one site that consumes more than 1MW annually to generate digital assets by securing a blockchain network. It also defines a “node” as a device containing a copy of blockchain technology and a “residence” as a permanent living space or structure.
Additionally, the bill suggests that the decision-making body for this legislation would be the local government, such as the city council or board of directors. Finally, it states that individuals can operate digital asset mining businesses in industrial areas that have not been designated for other uses by the local government.