The Board of Mayor and Aldermen in Kingsport, Tennessee, has approved modifications to the zoning regulations that enable cryptocurrency mining and data centers to operate in the region.

During a meeting on Tuesday, the board unanimously passed an ordinance amending land zoning concerning cryptocurrency mining sites and data centers, as reported locally. The new guidelines specify locations within the city where these operations can occur.

The ordinance’s adoption followed recommendations from the planning division in December and requires a second vote for formal acceptance.

“The City’s industrial district zoning code text was created without the anticipation of mass digitization,” according to the planning commission’s report to the board. “Staff expects to see new digital data-based industries looking for locations to develop. This text amendment allows for the City to appropriately locate and permit these uses.”

As per the amendment, cryptocurrency mining operations must be conducted in fully enclosed buildings, positioned away from residential zones, specifically at least 500 feet (approximately 152 meters) from any residential building or area. Furthermore, any crypto mining facility will need to pass a noise assessment, with a limit set at 60 dBA (A-weighted decibel) from the property line. In other U.S. locations, including Hood County in Texas, residents have initiated lawsuits regarding noise issues related to crypto mining.

With about 57,000 residents, Kingsport ranks among the top 20 most populous cities in Tennessee, marking significant implications for cryptocurrency legislation in a state that is increasingly welcoming to miners. For instance, CleanSpark has made arrangements to acquire several mining facilities in the Knoxville area.

Tennessee Legislator Proposes Bitcoin Reserve Bill

On a related note, Jody Barrett, a member of the Tennessee House of Representatives, has recently introduced the Tennessee Strategic Bitcoin Reserve Act. This proposed bill seeks to amend state regulations to authorize the treasurer to invest up to 10% of Tennessee’s general fund in Bitcoin (BTC). At the time of this report’s publication, it’s uncertain if the bill will garner sufficient support to pass through the general assembly. Should it be enacted, Barrett has suggested it take effect by July 1.