Nebraska Lawmakers Unanimously Approve Crypto Mining Regulations

Nebraska lawmakers have unanimously approved a bill, LB 526, that imposes new regulations on large-scale cryptocurrency mining operations within the state. The legislation, which passed with a 49-0 vote, requires crypto miners using one megawatt or more of power to cover infrastructure costs, report their annual energy usage publicly, and accept service interruptions during periods of grid strain. The bill now awaits Governor Jim Pillen's decision, with the law set to take effect on October 1 if signed.

Introduced by State Sen. Mike Jacobson in January, LB 526 aims to capture all primary commercial mining operations rather than small-scale hobbyists. The proposed law grants public power suppliers the authority to conduct load studies and impose these requirements, ensuring the measures are fair and nondiscriminatory. This move gives suppliers broad discretion to manage the growing energy demands associated with crypto mining.

Nebraska's approach to crypto mining regulation contrasts with other states. For instance, Arizona recently enacted a law shielding at-home miners and blockchain node operators from local zoning restrictions, while Kentucky signed a law protecting users who self-custody crypto and confirming that mining and staking are not considered securities. These diverging approaches highlight the varying stances on crypto mining regulation across the U.S.

The next step in Nebraska’s legislative process is its executive review. The governor has five legislative days, excluding Sundays, to sign or veto the bill. If he takes no action, the bill will automatically become law without his signature. As of now, the Governor’s office has not commented on LB 526.

The approval of LB 526 underscores Nebraska's commitment to managing the energy demands of emerging technologies while ensuring the stability of its energy infrastructure. By requiring crypto miners to contribute to grid upgrades and report their energy usage, the state aims to mitigate the strain on its energy resources and share the benefits of crypto mining with the broader community. This regulatory framework sets a precedent for other states considering similar measures and highlights the need for a balanced approach to managing the energy demands of the crypto mining industry.