Arkansas Digital Asset Mining Business Ownership Restrictions refers primarily to Arkansas Code \u00a7 14-1-606, added by Act 174 of 2024. The statute became effective on May 3, 2024, through an emergency clause and targets certain foreign-party ownership interests in digital asset mining businesses operating in Arkansas. As of June 9, 2026, the statute remains codified, but enforcement of Act 174 and the related Oil and Gas Commission Rule K has been preliminarily enjoined by the U.S. District Court for the Eastern District of Arkansas pending further court action.<\/p>\n
Act 174 was enacted as part of Arkansas\u2019 broader rewrite of the Arkansas Data Centers Act of 2023 and its new permitting framework for digital asset mining businesses. For ownership purposes, the key provision is \u00a7 14-1-606, titled \u201cOwnership of digital asset mining business by prohibited foreign-party-controlled business prohibited \u2014 Definitions \u2014 Penalty \u2014 Reporting.\u201d The act defines an \u201cinterest\u201d as an ownership interest greater than zero percent and defines a prohibited foreign-party-controlled business as a digital asset mining business in which a prohibited foreign party owns an interest.<\/p>\n
The restricted category of \u201cprohibited foreign party\u201d includes several groups tied to countries subject to \u00a7 126.1 of the International Traffic in Arms Regulations as of January 1, 2024, foreign governments formed in those countries, certain entities organized under those governments\u2019 laws, parties with significant interest or substantial control tied to those persons or governments, entities of particular concern designated by the U.S. Department of State, and agents or fiduciaries of covered persons or entities.<\/p>\n
Section 14-1-606 provides that a prohibited foreign party may not acquire or hold, by grant, purchase, devise, descent, or otherwise, any interest in a digital asset mining business in Arkansas. It also bars a person from acquiring or holding a digital asset mining business as an agent, trustee, or other fiduciary for a prohibited foreign-party-controlled business.<\/p>\n
For covered businesses already operating before the effective date, Act 174 established a 365-day period for the prohibited foreign party to divest all interest in the digital asset mining business. The Attorney General may investigate suspected violations, including by receiving sworn statements and issuing subpoenas for witness testimony and records. If the Attorney General concludes that a violation occurred, the statute authorizes a divestment order and, after noncompliance, a circuit-court action.<\/p>\n
Potential remedies include judicial foreclosure of the digital asset mining business, civil penalties up to $1 million or 25% of the fair market value of the prohibited foreign party\u2019s interest, court costs, prejudgment and postjudgment interest, reasonable attorney\u2019s fees, and treble damages if a court-ordered civil penalty is not paid. The statute also states that local approval, a state permit, or another authorization to operate is not a defense to an action under the ownership restriction.<\/p>\n
Act 174 also created Arkansas Code Title 23, Chapter 119, which requires a digital asset mining business to operate with a valid permit from the Arkansas Oil and Gas Commission and directs the Commission to promulgate implementation rules. Those permitting provisions are legally distinct from the ownership restriction, but the same federal litigation has addressed Act 174 and Rule K together because the court concluded the challenged provisions were not severable at the preliminary-injunction stage.<\/p>\n
In December 2024, the district court preliminarily enjoined enforcement of Act 174 against Jones Eagle LLC in litigation challenging Arkansas foreign-ownership restrictions. On April 29, 2025, in Arkansas Cryptomining Association v. York, the same court granted facial preliminary relief and enjoined the Arkansas Oil and Gas Commission director, the Arkansas Attorney General, and those acting in concert with them from enforcing any provision of Act 174 or Rule K until further order. The state officials noticed an appeal in May 2025. CryptoSlate should classify the law as an effective Arkansas act with enforcement preliminarily enjoined, rather than as repealed, expired, or struck down.<\/p>\n","protected":false},"excerpt":{"rendered":"
Arkansas Act 174 restricts prohibited foreign-party ownership of digital asset mining businesses; enforcement is preliminarily enjoined pending federal litigation.<\/p>\n","protected":false},"author":1652,"featured_media":540913,"template":"","meta":[],"crypto_law_jurisdiction":[81448],"crypto_law_topic":[81867,81869,81513,81871],"crypto_law_status":[81537],"crypto_law_type":[81544],"crypto_law_actor":[82279,82276,82280,82281],"crypto_law_asset_class":[81660,81635],"acf":[],"yoast_head":"\n