Home Technology The US is considering a 30% tax on cryptocurrency mining

The US is considering a 30% tax on cryptocurrency mining

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The US is considering a 30% tax on cryptocurrency mining

The impact of cryptocurrency production on energy systems has become a global issue (Photo: CC0 Public Domain)

US President Joe Biden proposed to introduce an additional tax of 30% on the price of electricity that is used to mine cryptocurrency. This will be the most drastic measure in the country to curb the uncontrolled use of electricity for crypto-mining.

This week, Biden outlined his plan for the DAME (Digital Asset Mining Excise Duty) bill to US lawmakers, PC World reported. Given the environmental impact of electricity production, as well as higher energy prices for all other industries, the end result of adopting DAME should be a whopping 30 percent tax on the energy used to mine cryptocurrency.

The DAME Act is not the first tool that US government agencies have tried to directly legalize cryptocurrency mining in order to limit or increase it. While laws regarding cryptocurrencies are still in their infancy, at the federal level cryptocurrencies can be considered either a security or a commodity, and are therefore taxed based on their value in US dollars.

Cryptocurrency exchanges are subject to the Bank Secrecy Act and other federal financial laws. One of the priorities of the Biden administration is the creation of a more comprehensive national policy for the regulation of cryptocurrencies.

The impact of cryptocurrency production on energy systems has become a global issue. In addition to the vast amounts of energy being legally converted into digital assets without the “local and national economic benefits typically associated with businesses using the same amount of electricity,” illegal electricity-stolen cryptocurrency farms and botnets often use infected computers to mine cryptocurrency.

China and several other countries have previously banned cryptocurrency exchanges – driven more by a desire to regulate money transfers than curb electricity use.

Despite growing interest in cryptocurrency regulation, President Biden’s DAME bill has little chance of becoming federal law in the short term due to domestic political complexities. But gradually agreement can be reached.

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