The Biden administration has proposed a budget for 2023 that would place a 30% tax on electricity used for cryptocurrency mining in the United States. This has caused some unease in the cryptocurrency community, as the tax could have a significant impact on the industry. The provision is intended to raise additional funds for the federal government, but it could also mean higher costs for those involved in cryptocurrency mining. It remains to be seen how this decision will affect the industry in the long term.
The Biden administration is striving to bring in more money while simultaneously tackling climate change by advocating for clean energy initiatives, which includes the proposed tax.
Environmentalists have voiced their disapproval of cryptocurrency mining, citing its large energy consumption and subsequent carbon footprint. The process requires a great deal of electricity to complete, which can be damaging to the environment.
The IRS would collect taxes from cryptocurrency miners who use more than 10 megawatts of power per year.
Many in the crypto-sphere have raised objections to the proposal, while others believe that it might push miners to use more sustainable practices and spur the growth of renewable energy solutions.
The fate of the proposed budget still hangs in the balance as it must be approved by Congress before it can become finalized. It is uncertain whether the proposal will ultimately be included.