Bitcoin-Friendly Senator Questions Proposed Mining Tax

Bitcoin-friendly Republican Senator Cynthia Lummis expressed doubts about the Biden Administration’s proposed 30% excise tax on Bitcoin miners, suggesting that it is unlikely to pass through the House. Speaking at Bitcoin Miami 2023, Senator Lummis remained supportive of the mining industry, emphasizing its importance for national security and the growth of the United States.

Bitcoin-friendly Republican Senator Cynthia Lummis doesn’t think the Biden Administration’s proposed 30% excise tax on Bitcoin miners isn’t likely to make it through the House. “That isn’t going to happen,” she said. “It’s absolutely important that the development of this…

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Concerns over Bitcoin Tax Proposal

During an interview with Perianne Boring, a member of the crypto advocacy group Chamber of Digital Commerce, Boring highlighted the concerns of their membership companies, which represent 50% of Bitcoin’s hashrate. They feared that if the tax were implemented, they would be unable to continue their operations in the United States. Senator Lummis provided reassurance to the Bitcoin community, stating that such a tax would not be imposed.

President Biden’s excise tax proposal was discreetly introduced in his 2024 budget plan, which also included new regulations targeting crypto wash trading and capital gains. The President’s Council of Economic Advisors supported the tax, arguing that it would address local environmental pollution and higher energy prices.

Contrary to these claims, Senator Lummis believed that Bitcoin mining is beneficial for the environment and energy grids. She cited examples from her home state of Wyoming, where miners are utilizing waste methane from oil and gas wells as an economic alternative, thus preventing harmful gas emissions. She added that Bitcoin mining can assist in stabilizing energy grids by adjusting mining operations based on energy demand.

In July 2022, Bitcoin miners collaborated with Texas regulators to conserve energy for residential use by pausing their operations. However, the Texas House of Representatives is currently considering a proposal to limit the number of miners participating in the demand response program, which financially compensates miners for their offline time.

A survey conducted by the Bitcoin Mining Council in Q4 2022 revealed that the global Bitcoin mining industry had a green energy mix of 58.9%. Despite potential discouragement of mining in the United States at the federal and state levels, Senator Lummis remained optimistic about the industry’s global survival. She mentioned that miners have the flexibility to operate anywhere, highlighting Norway’s inexpensive hydroelectric mining operations as an example.

Senator Lummis concluded by stating that opportunities for Bitcoin mining exist worldwide, in both friendly and less friendly jurisdictions. Her remarks highlighted the resilience and adaptability of the mining industry in finding suitable locations for their operations.