Arkansas Lawmakers Propose Bill to Ban Crypto Mining Near Military Bases

Arkansas lawmakers have introduced legislation aimed at restricting cryptocurrency mining operations near military facilities in the state. Senate Bill 60 (SB 60), introduced on January 15 by Senator Ricky Hill and House Speaker Brian Evans, seeks to amend the Arkansas Data Centers Act of 2023 to impose a 30-mile no-mining zone around military bases, camps, hospitals, clinics, and arsenals.

Key Provisions of the Bill

The proposed bill would prohibit new crypto mining facilities within a 30-mile radius of any U.S. military installation in Arkansas. However, it includes a grandfathering clause that would allow facilities already in operation before December 31, 2023, to continue their operations.

The bill specifically targets the Lonoke County crypto mining facility currently being developed near Little Rock Air Force Base in Cabot, Arkansas, which is owned by Florida-based real estate investment firm Interstate Holdings. This development has sparked controversy due to concerns over noise pollution and national security.

Noise Pollution and National Security Concerns

The push for the legislation follows complaints from local residents in Cabot, particularly regarding the noise generated by the crypto mining operations. Cabot Mayor Ken Kincade voiced concerns over the potential disturbance caused by the facility, stating that it would have a detrimental effect on the well-being of residents, animals, and the environment.

“These centers cause loud noise disturbances and pollution that produce negative effects on our people, pets, wild animals, nature, and overall well-being,” Kincade remarked in December.

Senator Hill echoed these concerns, adding that the proximity of the facility to the Little Rock Air Force Base raised national security issues. “Why did they pick this facility that’s less than five miles away from our air base? This is a national security concern,” Hill said, referring to the potential risks posed by large-scale crypto mining operations near sensitive military infrastructure.

Opposition from the Mining Facility’s Developer

Interstate Holdings, the firm behind the Cabot facility, has strongly opposed the proposed bill. Dustin Curtis, Vice President of Interstate Holdings, argued that the bill would make Arkansas the first state in the U.S. to implement such restrictions. He also pointed out that neither the governor’s office nor the attorney general’s office had requested the legislation.

Curtis further defended the Cabot facility, stating that it would generate less noise than the state highway running adjacent to the site. He emphasized that the facility had adhered to all state and federal regulations concerning noise, environmental impact, and security.

“The Cabot mine has met all state and federal regulations related to noise, environmental impact, and security,” Curtis added.

A Growing National Debate

The Arkansas bill is not the first attempt to regulate crypto mining near sensitive locations. In May 2023, the Biden administration issued an executive order preventing a China-linked crypto mining firm from using land near the Francis E. Warren Air Force Base in Wyoming. The administration cited concerns over national security and the environmental impact of large-scale crypto mining operations.

Additionally, U.S. Senator Elizabeth Warren has been vocal about the potential dangers posed by foreign-owned crypto mining operations on American soil. In a July statement, Warren highlighted the negative effects of crypto mining, stating, "They’re loud, they’re hot, and they suck up a ton of electricity, which can crash the power grid."

Broader Implications for Crypto Mining in the U.S.

The Arkansas bill is part of a growing trend of local and federal scrutiny over the crypto mining industry. As crypto mining operations expand across the U.S., concerns about their environmental impact, energy consumption, and proximity to critical infrastructure continue to surface. While some developers argue that the industry is being unfairly targeted, others, including lawmakers and local officials, are pushing for greater regulation to mitigate these risks.

As the debate over crypto mining regulation unfolds, Arkansas lawmakers will continue to navigate the balance between fostering innovation and ensuring the protection of military and residential areas from potential disruptions.