from Hacker News

Biden proposes 30% tax on crypto mining

by nullbyte on 3/12/24, 12:43 AM with 128 comments

• by perihelions on 3/12/24, 1:05 AM

  It's absurd to tax something that can so easily migrate to a different country. Of course, crypto mining is absolute wasteful crap. But this tax doesn't decrease the global crypto mining rate: all it does it shift the mining to a different country. And: unlike a lot of industries and heavy manufacturing, the local impact of a crypto mine is very one-sidedly positive—large amounts of cash injecting into the surrounding economy, particularly the energy sector and everyone who works in or profits from it.

  I do agree that (this type of) crypto mining is a sad waste of resources, and globally suboptimal for the world economy. But there's more to rationality and to morality than making performative gestures against bad things.

• by woodruffw on 3/12/24, 1:17 AM

  > Raising the corporate tax rate from the current 21 percent to 28 percent, combined with the average state-level corporate tax rate, would give the U.S. the second-highest combined corporate tax rate in the OECD, significantly worsening the competitive position of U.S. businesses and reducing prospects for business investment and workers.

  This is pretty misleading: the US's effective corporate tax rate is significantly below the OECD average[1], and has been so for a while. The Tax Foundation could lay the blame for this on tax complexity, but curiously only seems to blame tax complexity when taxes go up for businesses, not down.

  [1]: https://stats.oecd.org/index.aspx?DataSetCode=CTS_ETR

• by dpc_01234 on 3/12/24, 1:10 AM

  Mining is actually good for stabilizing grid, which is very important for accommodating renewables.

  Yes, mining is "wasting" electricity, but it's not a full picture. Sometimes being able to "waste" electricity is actually very useful. Mining is a immediately reactive and flexible load on the grid, and in a free market , at the near-perfect competition, mining naturally gravitates to places where electricity is abundant and can benefit from doing something productive (burning off methane, capture over-production).

  People who wish to ban or "harm" mining have no idea what they are talking about. Electricity is not something that can sit in a basement and wait to be used indefinitely if someone doesn't just "waste" it. That's just not how things work.

  From the perspective of cryptocurrency users banning also completely doesn't matter. If you ban mining in place X, then too bad for the miners in X, mining will just move to a different location, where possibly electricity might be less clean (not from renewables), and on the global scale things just get worse.

• by htatche on 3/12/24, 12:56 AM

  It needs to be banned. The environment is orders of magnitude more important than the dollar.

• by ProjectArcturis on 3/12/24, 1:04 AM

  This will push it offshore, which is still a win for US consumers.

• by Ajedi32 on 3/12/24, 4:45 PM

  The thing people who are against crypto mining miss is that the cryptocurrency industry is economically self sustaining. Electricity burned on mining crypto is not wasted, it is used to maintain a system that is objectively more economically valuable than the electricity itself is.

  Trying to regulate what people are allowed to spend their money on just because you personally don't agree those things are valuable is a fool's errand.

  To the extent there are negative externalities associated with electricity use those externalities are not specific to crypto, therefore singling out crypto for attack just because it uses electricity is unfair and harmful to the broader economy.

• by nullbyte on 3/12/24, 12:43 AM

  Some notable stuff:

  - Corporate tax rate increases by 7% for all businesses

  - 30% excise tax on electricity costs associated with crypto mining

• by kennu on 3/12/24, 1:33 AM

  This is not about crypto mining per se, but the electricity used:

  > Impose a new 30 percent excise tax on electricity costs associated with digital asset mining

  Seems like an effective incentive to migrate cryptocurrencies from Proof-of-Work to the more eco-friendly Proof-of-Stake. Ethereum already did this two years ago.

• by tareqak on 3/12/24, 2:04 AM

  I think crypto-mining could be help with bringing on more electricity from renewable resources online faster and more gracefully in the absence of sufficiently large scale grid batteries.

  Imagine a solar or wind power plant that currently has sufficiently problematic swings in electricity production. A crypto-mining data center nearby could consume some if not all of this problematic excess electricity production more gracefully than disabling sections of the solar or wind power plant. In this application, crypto-mining would not be the primary reason to have all of this crypto-mining hardware. As the local grid requires more power generation, crypto-mining nodes could be turned offline to offset their electricity use.

  This thought is just something I had, and there might be problems with it.

• by kristianp on 3/12/24, 1:10 AM

  Actual title: President Biden Outlines Vision for Higher, More Complicated Taxes in State of the Union Address and FY 2025 Budget

  Edit: The hacker news guidelines say don't editorialise the title.

  "Otherwise please use the original title, unless it is misleading or linkbait; don't editorialize.".

  https://news.ycombinator.com/newsguidelines.html

• by Havoc on 3/12/24, 1:18 AM

  Good luck enforcing that

• by jedberg on 3/12/24, 1:12 AM

  What a funny way to say "carbon tax".

  Why not just go all out and propose a carbon tax and credit system? I guess that's too complicated for the electorate to understand?

• by tazu on 3/12/24, 1:05 AM

  A win for Proof-of-Stake?

• by Justin_K on 3/12/24, 5:05 AM

  Got to raise taxes to pay for all the bullshit spending. Why don’t they just tax excess power usage?

• by KerrAvon on 3/12/24, 1:08 AM

  note: taxfoundation.org doesn’t seem to be nonpartisan

• by yashg on 3/12/24, 5:05 AM

  Just outright ban the stupid planet burning ponzi. If the habitual gamblers want to gamble with make believe internet tokens, let them do it with tokens that don't waste a country full of energy. I am sure they can cook up some story to keep the crowd engaged.