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Implications as Debt Limit Deal Omits Biden’s Crypto Tax

source-logo  dailycoin.com 29 May 2023 10:00, UTC
  • President Joe Biden’s proposed crypto mining tax has been struck out.
  • The move represents a win for the Bitcoin mining industry.
  • The U.S. risked being toppled as the top country for Bitcoin mining.

U.S. President Joe Biden’s administration has recently espoused hard stances on crypto taxation.

Earlier in May, the administration reiterated plans to impose a 30% tax on crypto mining as part of its 2024 fiscal budget proposal, arguing that miners did not cover the economic and environmental costs they impose on others. The proposal unsurprisingly sparked criticism from the Bitcoin community and further fueled narratives of government hostility towards crypto.

The so-called Digital Asset Mining Energy (DAME) excise tax has now been scrapped following extended negotiations between the Biden administration and House Speaker Kevin McCarthy aimed at raising the U.S. debt limit to prevent an impending default.

A Win for the Bitcoin Mining Industry in the U.S.

In a tweet on Monday, May 29, Representative Warren Davidson confirmed that the 30% crypto mining tax had been discarded as part of the in-principle debt limit deal reached over the weekend by Biden and McCarthy.

“Yes, one of the victories is blocking proposed taxes,” Davidson tweeted in response to inquiries from Riot Platforms’ Pierre Rochard, who noted that the tax was missing from the bill.

Yes, one of the victories is blocking proposed taxes.

— Warren Davidson 🇺🇸 (@WarrenDavidson) May 29, 2023

The development marks a significant win for Bitcoin miners and the mining industry in the U.S., as expressed by many community members.

🇺🇸 Good news for #Bitcoin Mining in the land of the free 🙏 https://t.co/N0a0q7kXyR

— Simon Dixon (@SimonDixonTwitt) May 29, 2023

Fourth Turning Investments founder Chris Dark asserted that it was good to see discussions around Bitcoin at the highest levels of government while arguing that the tax had no chance of passing Congress in the first place.

This is cool. The DAME tax was never gonna pass the House anyway, but it’s cool that things like this that affect Bitcoin are genuinely being discussed at the highest levels of Gov https://t.co/0nl6D7HEH7

— Dr. Chris Dark (@Darky999) May 29, 2023

The U.S. Bitcoin mining industry has become the largest in the world following the mass exodus of miners from China in 2021, accounting for over 30% of the global mining pool. However, The proposed electricity consumption tax could have forced the industry to look elsewhere.

Aside from the crypto mining tax, the Biden administration also wanted to cover tax loopholes for “wealthy crypto traders.

On the Flipside

  • The debt ceiling deal has yet to pass Congress, with lawmakers split on the agreement.

Why This Matters

By blocking the crypto mining tax, the government has given the Bitcoin mining industry a chance to continue to grow in the U.S.

Read this to learn about Senator Cynthia Lummis’ position on the crypto mining tax:

Sen. Cynthia Lummis Joins Fight Against Biden’s Crypto Tax

Heard about the Cosmos (ATOM) ecosystem but still trying to figure out what it is? Find out more:

Cosmos (ATOM): What if All Blockchains Could Communicate?