What comes as a major setback to crypto miners in the United States, the White House is lobbying Congress to include a tax of 30% on the cost of the electricity used to mine cryptocurrencies in the upcoming federal budget. This development comes on the heels of the U.S. government’s repeated claims of potential damage to the environment caused by a subset of the cryptocurrency industry.
US Claims Crypto Mining Poses Threat To Society
According to a recent report that is set to be published in the White House today, the President’s Council of Economic Advisers (CEA) argues that Crypto miners’ high-energy consumption has negative spillovers on the environment, quality of life, and electricity grids where such businesses are located.
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The cryptocurrency mining business is being unfairly targeted, according to those who oppose the planned tax. The rampant crypto crackdowns by the regulators and now a proposed bill to impose hefty tax stand out as a sore eye for the larger crypto market and being part of a larger anti-crypto crusade. According to Tom Mapes, head of energy policy at the Chamber of Digital Commerce, who spoke with Yahoo News, stated that “this is just a way to go after the industry which they do not support.”
Bitcoin’s PoW In Controversy
Bitcoin’s Proof-of-Work mechanism has long been appreciated and debated since its inception. Massive supercomputers compete with one another in order to be the first to solve a mathematical riddle in the process of PoW cryptocurrency mining. According to a report published by the White House in September of last year, the mining of cryptocurrencies consumes more electricity than the entire country of Australia. It is estimated that cryptocurrency mining accounts for 0.9% to 1.7% of total electricity use in the United States, which is home to approximately one-third of all mining operations.
The Cryptocurrency Environmental Alliance (CEA) states in a post that “currently, cryptocurrency mining firms do not have to pay for the full cost they inflict on others, which includes local environmental pollution, higher energy prices, and the massive impacts of increased greenhouse gas emissions on the climate.”
At the time of writing, Bitcoin’s price is currently exchanging hands at $28,046 with a market cap of $544 billion.
Also Read: U.S. Investors Abandoning Crypto Exchanges, But Where Are They Going?
The post Breaking: Bitcoin Mining Faces Major Blow As Biden Proposes 30% Tax appeared first on CoinGape.
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