Source: Cointelegraph Original: "{title}"

The Arkansas Cryptocurrency Mining Association has filed a lawsuit against two state officials, accusing them of enforcing an unconstitutional and discriminatory state regulation that prohibits U.S. citizens born abroad from participating in cryptocurrency mining and related activities.

The lawsuit was submitted on March 13 to the U.S. District Court for the Eastern District of Arkansas, with the defendants being Arkansas Attorney General Tim Griffin and Lawrence Bengal, Director of the Arkansas Oil and Gas Commission.

Previously, a federal court ruling in November had temporarily prohibited Arkansas from preventing a naturalized U.S. citizen of Chinese descent from operating a cryptocurrency mining business.

At the heart of the controversy are Arkansas's "Rule K" and "Act 174," which prohibit foreign-owned enterprises from conducting related business in the state.

Connor L. Kempton, Director of the Arkansas Cryptocurrency Mining Association, pointed out that the wording of Rule K and Act 174 is vague, granting the defendants arbitrary and discriminatory enforcement powers, allowing them to decide whether to approve licenses based on personal judgment.

He emphasized that the application of these two regulations is not only unconstitutional but may also constitute discrimination based on race, foreign status, and nationality.

Excerpt from the ACA lawsuit against Bengal and Griffin. Source: Court documents reviewed by Cointelegraph

Kempton noted that these regulations target the cryptocurrency mining company Jones Eagle LLC, operated by Qimin "Jimmy" Chen, a naturalized U.S. citizen of Chinese descent.

Kempton specifically cited the Equal Protection Clause of the Fourteenth Amendment to argue the illegality of Rule K and Act 174.

The Equal Protection Clause also prohibits U.S. states from denying individuals equal protection under the law based on race, foreign status, or nationality.

The cryptocurrency mining executive also argued that Rule K and Act 174 deprive U.S. citizens like Chen of their due process rights under the Fourteenth Amendment.

Kempton further stated that the bans and penalties imposed by Act 174 infringe upon the federal government's authority to investigate, review, and take action on foreign investments.

"Act 174 attempts to establish its own foreign policy for Arkansas, thereby infringing upon the federal government's exclusive power to manage foreign affairs."

District Court Judge Kristine G. Baker stated on December 9 that Arkansas officials are prohibited from enforcing Act 174 against Jones Eagle until further notice.

Related: Analysts believe that the decline in cryptocurrency trading volume suggests a weak market.

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