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On July 14, New York became the first U.S. state to ban energy-intensive artificial intelligence (AI) data centers for a period of one year.
Governor Kathy Hochul signed an executive order to bar the construction of new “hyperscaler” data centers using 50 megawatts or more of power for up to one year.
She attributed the decision to New Yorkers expressing concerns regarding the potential impacts of these data centers on energy use, water use, water quality, air quality, noise, lighting, quality of life, and other potential environmental impacts.
It is the first statewide data center ban in the U.S.
President Donald Trump slammed Hochul for the decision and asked the state to change its moratorium immediately, or else China wins the AI war. Sen. John Fetterman (D-PA) also called it China’s win.
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New York ban has grave implications for Bitcoin miners-turned-AI giants
New York’s one-year moratorium could create a hurdle for Bitcoin (BTC) mining companies that have spent the past two years reinventing themselves as AI infrastructure providers.
As mining margins came under pressure following the 2024 halving and the ongoing Bitcoin crash, several publicly traded miners pivoted toward leasing power and data center capacity to AI and high-performance computing (HPC) customers in search of steadier revenue.
IREN Limited (Nasdaq: IREN) is a high-profile company that shifted from being a pure-play Bitcoin miner to hosting AI infrastructure through multi-billion-dollar deals with Microsoft and NVIDIA.
TeraWulf (Nasdaq: WULF) is another Bitcoin miner-turned-AI firm that recently signed a 20-year lease agreement with Anthropic for over 401 megawatts of power capacity.
It wasn’t an expensive choice for the miners, given that these companies already had a ready infrastructure. But expansion requires more capacity building, which is facing intense scrutiny as the New York moratorium illustrates.
Although New York is not the largest hub for these companies, the state’s moratorium underscores a broader challenge before the Bitcoin mining industry.
Many Bitcoin miners aim to become AI giants, but the transition heavily relies on access to large amounts of low-cost electricity and the ability to rapidly build or expand data centers.
