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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

#61

Post by apendleton »

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…

It seems like in the immediate term, and possibly forever, part of the process of decarbonizing the electricity sector is going to be demand management -- we have a finite amount of clean power available, and bottlenecks (interconnection, permitting, etc.) on the speed with which more can be built, so some of the work will just be discouraging use. It doesn't strike me as unreasonable that, if _some_ use needs to be discouraged, the state should have some opinion as to which use it is that gets the short straw, especially since a flat tax on all use would be super regressive: if higher electricity prices mean some retiree in the sun belt can't afford their AC in the summer and dies of heat stroke, avoiding that by shifting the costs onto crypto bros seems like a no-brainer.

All of this probably becomes even more true as load-shifting becomes a bigger deal. Like: currently, replacing gas-powered boilers for 24/7 industrial processes with electrified heating isn't anywhere near cost-effective if you have to pay peak electricity rates for heating, but there are a bunch of new heat-battery companies spinning up that will take advantage of wholesale fluctuations to generate a ton of heat in the middle of the day when the sun's out, heat up a big box of rocks or whatever, and they siphon off the heat over the course of the day as electricity prices spike in the evening. This could dramatically accelerate industrial-heat decarbonization (which is something like 30% of US GHG emissions), but it only works if there's a price trough to take advantage of; if there are crypto-miners there to gobble up all the curtailed power and stabilize the price, the economics don't pencil out, and we're stuck with gas heat for factories. Again, doesn't seem unreasonable as a thing the state would have an opinion about.

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

#62

Post by Imnimo »

lockhouse wrote: post #58
paxys wrote: post #39

Earlier quoted context omitted.

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.

How do you think any other taxes are enforced?

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

#63

Post by bradjohnson »

Mistletoe wrote: post #54
mattgreenrocks wrote: post #22

Earlier quoted context omitted.

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/

Useful how? Linking a real-time deflation chart doesn't exactly scream "useful".

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

#64

Post by belter »

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.

This looks like a variation of the Obama Administration stance on new US based Coal Power Plants: "We are not going to forbid anybody from do it, but we will make sure they go bankrupt in the process of doing it." :-)

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

#65

Post by ragebol »

knicholes wrote: post #43
ulrashida wrote: post #25

It's a smart idea. Who is going to have sympathy for crypto miners? As a citizen, would you rather a Watt of power go to driving an industrial facility, heating a home, or making a Shibacoin? For most it's a very easy calculus. Either they pay up, in which case there's a new revenue stream, or they don't, in which case energy prices will go down due to the lowering of demand. A win for the general public and an easy…

Heating a home and mining crypto don't have to be mutually exclusive!

I thought these guys [0] were out of business but at least the website is still alive. They ma{k,d}e a server that provides heat to your home. Just give it power and internet access, they provide compute loads. Now that I have solar panels, a hybrid heat pump and currently excess electricity, this is interesting to warm up a vat of tap water, for example. Any guides on DIYing such a combo?

[0] https://nerdalize.cloud/

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

#66

Post by paxys »

belter wrote: post #64
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.

This looks like a variation of the Obama Administration stance on new US based Coal Power Plants: "We are not going to forbid anybody from do it, but we will make sure they go bankrupt in the process of doing it." :-)

> but we will make sure they go bankrupt in the process of doing it

More like – we will cut subsidies on coal by just a little bit and let them try and get profitable by themselves.

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

#67

Post by davidguetta »

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.

They are just gonna move to khazakstan

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

#68

Post by xk_id »

I think it’s short sighted to celebrate this. In reality it won’t reduce the demand for bitcoin hashpower. Instead it will force miners to flee to foreign jurisdictions (like Kazakhstan, china, russia, iran, venezuela), who are the least producers of clean energy. The result becomes higher climate impact, loss of domestic taxable income and slower growth of renewable energy due to lowered demand. Not to mention the moral issue of setting a precedent for permissioned electricity consumption .

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

#69

Post by klobuerste »

ETH_start wrote: post #45
runnerup wrote: post #17

Earlier quoted context omitted.

That's probably a net benefit for the USA. The same people will still accrue the benefits of mining, but without stressing domestic infrastructure.

I'm not a fan of Proof of Work mining now that a robust Proof of Stake consensus algorithm is fully operational in Ethereum, but if the Bitcoin mining operations stay in the US, their revenue will go toward funding the expansion of domestic infrastructure. It's clearly in US interests to keep mining domestic.

[dead]

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

#70

Post by siegfriedernst »

ETH_start wrote: post #45
runnerup wrote: post #17

Earlier quoted context omitted.

That's probably a net benefit for the USA. The same people will still accrue the benefits of mining, but without stressing domestic infrastructure.

I'm not a fan of Proof of Work mining now that a robust Proof of Stake consensus algorithm is fully operational in Ethereum, but if the Bitcoin mining operations stay in the US, their revenue will go toward funding the expansion of domestic infrastructure. It's clearly in US interests to keep mining domestic.

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