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White House proposes 30 percent tax on electricity used for crypto mining

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Re: White House proposes 30 percent tax on electricity used for crypto mining

#51

Post by dsr_ »

golergka wrote: post #41

So weird seeing such a positive feedback here as opposed to ISPs attempts to break net neutrality when it's exactly the same thing. When you purchase services or commodities, price either should depend on what you're using them for, or it shouldn't.

All societies are engaged in encouraging some behaviors, being neutral about some, and discouraging others. The tools for encouragement and discouragement are almost always, and always should, lie on a continuum from "subtle" to "draconian".

Your proposal amounts to banning the intermediate grades.

I suspect this is not what you actually want. It is certainly not what I want.

Re: White House proposes 30 percent tax on electricity used for crypto mining

#52

Post by ipaddr »

jonny_eh wrote: post #35
ipaddr wrote: post #32

All this does is move HQ. There is a reason most US cargo ships sail under a foreign flag like liberia

Ships are on water, their flag doesn't matter much. But charging a tax on activities occurring within the border has the effect of discouraging that activity. You can't slap a different flag on a server and escape the tax.

The flag matters to pollution controls, liability and taxes not to mention employee rights/wages. You are talking about billions of lost money.

You can become a European company operating in the US. You can have a shell company operate the mining. You can show no profit.

Re: White House proposes 30 percent tax on electricity used for crypto mining

#53

Post by shadowgovt »

ipaddr wrote: post #37
missedthecue wrote: post #9

Earlier quoted context omitted.

US mines more bitcoin than any other country. The big thing now is using natural gas from oil wells that are not connected to gas pipelines (it's not economical to connect them), so instead of flaring the gas off into the sky, they fuel a generator to power a bitcoin farm using essentially free electricity.

What is the tax rate on free electricity?

"Value of that electricity, if purchased externally." https://home.treasury.gov/system/files/131/General-Explanati...

Re: White House proposes 30 percent tax on electricity used for crypto mining

#54

Post by Mistletoe »

mattgreenrocks wrote: post #22
Mistletoe wrote: post #14

Bullish for Ethereum I guess, which has cut its electricity usage by 99.9% or something since switching to Proof of Stake.

I'm really tempted to buy some ETH at this point, and I'm a crypto skeptic who owns nothing. Smart move?

I'm not a good person to ask since I've been drinking the crypto kool-aid since I was an Ethereum miner long ago and now staker. In a world of rampant money printing and inflation and artificial everything, yes I think Ethereum will be useful for a very long time.

https://ultrasound.money/

Re: White House proposes 30 percent tax on electricity used for crypto mining

#56

Post by paxys »

leetcrew wrote: post #34
jrm4 wrote: post #24

As someone who's neutral/vaguely positive on crypto (which is to say, it's gonna happen regardless of what any of us think of it ) this is a great idea, simple and to the point. Mining crypto is (now DEFINITELY) wasteful; make it more expensive. I'd go higher, even.

I agree crypto mining is wasteful, but I don't think this kind of narrowly targeted tax is the right solution. ideally the federal government would not have an opinion on what citizens use electricity for, only that the externalities of power generation are priced in. at a high level, crypto mining is just arbitraging the price of electricity. if the externalities are priced into generation, this is a non issue. if t…

> ideally the federal government would not have an opinion on what citizens use electricity for, only that the externalities of power generation are priced in.

Only if you take the stance that energy generation and use sure be governed by pure free market economics, which never works out in the real world. Natural resources are limited. Mining/drilling has environmental impacts. People need energy to survive. It makes a lot more sense to go the opposite direction – treat it as a public good (which it is) and regulate usage. Otherwise you will end up in the inevitable reality where there is a large bitcoin mine in town printing cash for its owners and no one living around it can afford to heat their houses.

Re: White House proposes 30 percent tax on electricity used for crypto mining

#57

Post by shadowgovt »

ETH_start wrote: post #29
Mistletoe wrote: post #14

Bullish for Ethereum I guess, which has cut its electricity usage by 99.9% or something since switching to Proof of Stake.

Yes, and while I'm pro-ETH, I'd prefer if Ethereum doesn't surpass Bitcoin as a result of the government abandoning fairness and neutrality, and discriminating agaist some uses of electricity over others.

By what principle is the government constrained from discriminating against some uses of electricity?

Re: White House proposes 30 percent tax on electricity used for crypto mining

#58

Post by lockhouse »

paxys wrote: post #39
lockhouse wrote: post #27

Earlier quoted context omitted.

So would they tax all the electricity that company uses or just the electricity used for mining? The article isn’t very clear on the specifics.

The company has to declare it themselves. They can lie, but they can also get audited and caught. This is how all taxes work.

Oh the honor system, we tried that with all the COVID money that we threw around and people bought Corvettes with it. This is just a terrible, unenforceable idea. Say they do get audited, how do you prove how much electricity they used to mine crypto? Unless that company wires a meter directly to the circuit that powers their mining rigs, it will be a total guess.

Re: White House proposes 30 percent tax on electricity used for crypto mining

#59

Post by tialaramex »

jonny_eh wrote: post #35
ipaddr wrote: post #32

All this does is move HQ. There is a reason most US cargo ships sail under a foreign flag like liberia

Ships are on water, their flag doesn't matter much. But charging a tax on activities occurring within the border has the effect of discouraging that activity. You can't slap a different flag on a server and escape the tax.

The Paris MOU was such a success that many parts of the world have Port State Control (rather than Flag State) too now.

If your ship flying Country X's flag docks in Europe then under the Paris MOU your flag decides how likely you are to get inspected by local authorities. Does Country X do a great job? Then inspections will be rare and you've nothing to worry about. Not so much? Expect to spend far more of your visits being inspected and if you don't obey inspection rules under the Port State rules too bad, their port, their laws apply, if you don't like it stop coming to Europe. If Country X don't like it, and I promise they don't give a shit once you paid the registration fee, they can take it up with Europe and see how far that gets them.

Re: White House proposes 30 percent tax on electricity used for crypto mining

#60

Post by Verdex »

leetcrew wrote: post #34
jrm4 wrote: post #24

As someone who's neutral/vaguely positive on crypto (which is to say, it's gonna happen regardless of what any of us think of it ) this is a great idea, simple and to the point. Mining crypto is (now DEFINITELY) wasteful; make it more expensive. I'd go higher, even.

I agree crypto mining is wasteful, but I don't think this kind of narrowly targeted tax is the right solution. ideally the federal government would not have an opinion on what citizens use electricity for, only that the externalities of power generation are priced in. at a high level, crypto mining is just arbitraging the price of electricity. if the externalities are priced into generation, this is a non issue. if t…

On an individual level, I agree with this sentiment. However, as power and influence increases, I feel, so too does accountability to the community.

For example, if an individual wants to have christmas lights on their house year round, I think they should be allowed to as long as they can pay their electric bill. However, if a crazy billionaire wants to blast a giant laser into the sky and this causes brown outs due to the power draw to the surrounding community, then I think the community should be able to get the laser shut off. And on the other hand, if the billionaire runs a free entry water park and that causes brownouts, I think the community should be able to decide whether or not to flip the switch.

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