Lake Placid, North Elba will place moratorium on cryptomining

A group of cryptomining drives seen in Plattsburgh in March. (Enterprise photo — Griffin Kelly)

LAKE PLACID — Both Lake Placid and North Elba approved an 18-month moratorium on cryptomining within the town and village.

The moratorium will start within 30 days of the bill being filled with the state senator’s office.

Cryptomining is the process of computers “mining” for online currencies such as bitcoins and Zcash, which are kind of like digital versions of real money only they’re not recognized by official governments or treasuries at this point. This is all done through computer drives constantly solving intricate math problems. The process can use up quite a bit of energy; that’s why cryptominers look to places which cheap power rates to set up shop.

After Plattsburgh received a higher electric bill this past winter, due in part to cryptomines using up 10 percent of the city’s allotted hydroelectric power, Mayor Colin Read proposed a moratorium there. When a municipality goes over its allotted power in any given month, the area must then buy energy from the open market, which costs more.

Fearing the same rise in energy rates, the Lake Placid village board followed Plattsburgh’s example, but before they could pass a moratorium, both the town and village needed to hold public hearings.

The village held its hearing Monday night. Village Mayor Craig Randall read the proposal then opened the floor to any public comments and questions. Despite the boardroom containing about 40 people — a rare occurrence for the biweekly meeting — only two commented on cryptocurrency. The crowd was more concerned with the following hearing on signage code.

After a few moments of silence, Martin Shubert stood and commended the village board for taking the initiative to hinder cryptomining.

“I can see no positives with that group,” he said. “I don’t mean to sound sharp, but I think they would come here and rape our electric department.”

Shubert also suggested making the moratorium even longer.

Another village local, James Hughes seconded Shubert’s opinions.

Village Trustee Jason Leon added how the allotted hydropower is a relatively clean source of energy, whereas open market energy creates more of a risk for adverse environmental impacts.

The town had its hearing Tuesday night. No one in attendance provided any negative or positive comments on the subject. Instead, the hearing was more like a time for the town board to pose questions as to what cyrptomining is exactly.

The town and village boards might agree with comedian John Oliver’s take on cryptocurrency. In a March episode of his HBO show “Last Week Tonight,” Oliver described cryptocurrency as a confusing subject that “combines everything you don’t understand about money with everything you understand about computers.”

What both boards do know, though, is the cost to the taxpayer. They don’t want to see energy bills rise, especially when cryptomining doesn’t have to create new jobs. Only a few workers are required to efficiently monitor hundreds of computer drives.

Over the next year-and-a-half, the boards will research cryptomining and conclude how it would affect the area.

In a previous interview, Randall said he has attended informational meetings on the subject and spoke with Ryan Brienza who operates a cryptomine in Plattsburgh, which was grandfathered into the city’s moratorium.


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