In March, President Joe Biden released his annual budget proposal outlining his policy priorities for the coming year. With respect to the digital asset industry, the proposal touched upon crypto mining. Specifically, Biden called for a 30% tax on all electricity used to mine Bitcoin and other cryptos.
However, according to Marathon Digital’s CEO Fred Thiel, Biden’s tax plan won’t work. In an interview during the Bitcoin Miami Conference, the Marathon executive hinted that the administration is looking to target the Bitcoin ecosystem. Chalking out the potential consequences, he said,
“Bitcoin miners will just leave the U.S., which is really what they’re trying to… While I’m not gonna go so far as to say that they want to kill Bitcoin, they want to make it very difficult for people to operate.”
In fact, Thiel went on to further hint that Marathon already intends to grow outside of the U.S. Here, it is worth recalling that the SEC has issued another subpoena against the Bitcoin mining company. In its recent quarterly report, the firm indicated that the filing might be related to its 100-megawatt data center in Hardin, Montana. Nevertheless, the firm affirmed that it is cooperating with the SEC. Its report clarified, “SEC may be investigating whether or not there may have been any violations of the federal securities law.”
Also Read: SEC Files Another Subpoena Against Bitcoin Miner Marathon
Tax imposition won’t result in more available renewable power: Thiel
Biden’s 30% mining tax proposal has received reactions from both sides of the spectrum. On one hand, community members seem to be displeased. On the other, regulators seem to be batting on the same team. Recently, the White House’s Council of Economic Advisers contended that the proposed tax “encourages firms to start taking better account of the harms they impose on society.”
In fact, the council’s report cited a New York Times investigation piece. According to the same, the power consumption associated with 34 of the largest crypto-mining operation, is equal to the power used by the surrounding 3 million homes. Parallelly, the CEA report highlighted that the amount of electricity used in crypto mining in the U.S. last year was “similar” to the amount used to power all of the country’s home computers or residential lighting.
Thiel, nonetheless, argued that the imposition of a mining tax will not result in more available renewable power. Specifically, he said,
“It’ll actually create less because if you’re building a solar farm today or wind farm, it’s a two-year waiting list to interconnect. And Bitcoin miners provide the economic incentive for those people to operate.”
Also Read: President Biden Proposes 30% Tax on Electricity Used to Mine Cryptocurrency