TeraWulf Inc. (NASDAQ:WULF) stock is trading lower on Tuesday, following news from Albany, New York, where Gov. Kathy Hochul signed an executive order launching the first statewide moratorium on new hyperscale data centers.
Originally founded as a Bitcoin miner, this North American-based data center operator’s stock faced downward pressure as the state temporarily paused environmental permits for up to one year to establish a new regulatory framework.
• TeraWulf stock is among today’s weakest performers. Why is WULF stock dropping?
Moratorium Pauses State Environmental Permits
The executive action halts discretionary state environmental permits from the Department of Environmental Conservation (DEC) that are not already deemed complete. According to the governor’s office, the one-year pause aims to protect ratepayers, the environment and the energy grid from the high energy and water demands of artificial intelligence and computing operations. The state will develop a Generic Environmental Impact Statement (GEIS) during this period to assess impacts on energy demand, water quality, and air quality.
Bitcoin Gains Countered by Policy Changes
The regulatory setback follows a broader market shift from Monday, when crypto-linked companies traded lower due to declining Bitcoin (CRYPTO: BTC) prices amid escalating U.S.-Iran tensions. On Tuesday, Bitcoin recovered, rising 3% to $64,783; however, the regulatory pause in New York weighed on the data center sector.
Hochul also announced plans to pursue legislation to repeal sales tax exemptions for massive data centers across the state.
Earnings and Short Interest Data
The policy shift comes ahead of TeraWulf’s scheduled second-quarter earnings report on Aug. 7. Financial analysts estimate a loss per share of nine cents and quarterly revenue of $47.99 million for the company.
Recent market data shows short interest in TeraWulf decreased from 108.65 million to 104.66 million shares during the last reporting period, leaving 24.87% of the company’s publicly available shares short. Based on the average daily trading volume of 29.27 million shares, short sellers would require 3.58 days to cover their positions.
WULF Stock Price Activity: TeraWulf shares were down 7.16% at $19.39 at the time of publication on Tuesday, according to Benzinga Pro data.
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