Massena opens industrial zones to cryptocurrency miners; town attorney says use was already allowed
Wednesday, May 16, 2018 - 10:04 pm

By ANDY GARDNER

MASSENA -- The Town Council on Wednesday approved a code change governing the use of data centers in industrial zones, which is in response to cryptocurrency mining companies expressing interest in Massena.

Town Supervisor Steve O'Shaughnessy said the new law defines a data center as "an area where companies involved in computer, internet technology and software development are based."

Town attorney Eric Gustafson said the law already allowed for such a use.

The way I think about this is the definition of the allowed uses in the industrial zone ... was broad enough in my opinion to include the industrial park ... a clarification of what was already there ... made it perfectly clear that's something that's allowed in that industrial zone," he told the board.

Several cryptocurrency miners have expressed interest in the area, and one is already up and running.

Coinmint had sought a power discount from the New York Power Authority, but NYPA's board never acted on their application and passed a moratorium on granting discounts to cryptocurrency firms until they can learn more.

A second company, Blockchain Industries, had sought to buy town land on county Route 43 to build a cyptocurrency mine. They pulled out of the area after NYPA announced their moratorium.

A third company, Skynet Digital, is running a cryptocurrency mine out of the R.E. Michael building in the village.

Cryptocurrency mining involves using powerful computers running online 24 hours a day, seven days a week, to solve complex math problems that encrypt and unlock the cryptocurrency on a secure ledger of transactions known as a blockchain. The unlocked and encrypted portions of the blockchain are then sold or traded as a commodity. Probably the most well-known form of cryptocurrency is Bitcoin. There are hundreds other varieties, such as LiteCoin and Ethereum.

Massena Electric Department officials earlier in the year said they were studying the potential impact of adding cryptocurrency miners to their power grid. MED board chairman James Shaw went in front of the Town Council at their March meeting and said it has the potential to drive up rates for the entire system. He said they are monitoring their power grid for signs of people mining cryptocurrency.