The US government wants to levy a 30 percent tax on electricity used for mining cryptocurrencies. According to the White House, this is necessary because crypto mining organizations are currently not paying for all the economic and environmental costs they impose on others.
These include the costs of environmental pollution, higher energy prices and the increased greenhouse gas emissions that mining cryptocurrencies causes. “The Digital Asset Mining Energy tax incentivizes companies to be more considerate of the harm they are doing to society,” the US government writes. in a blog post.
According to the US, this high energy consumption leads, among other things, to higher electricity bills for surrounding consumers and overloaded equipment, which leads to server failures and ‘security risks’. In addition, local energy companies run financial risks if they decide to increase their capacity, as it may prove unnecessary if the cryptominers stop doing so, the government said.
According to a survey of The New York Times, cited by the Biden administration, the 34 largest cryptominers in the US used a combined 50 billion kWh of electricity last year. That is equivalent to the consumption of three million US households and is more than is needed to power all PCs in the US. According to the newspaper, most crypto mining activity has been taking place in the US since China restricted the mining of such currencies in 2021. In addition to the fact that crypto mining requires a lot of electricity, the government argues that it does not provide economic benefits such as employment, unlike other sectors that consume a lot of electricity.
The government wants the proposal to take effect in the financial year of 2024. The DAME excise duty is to be introduced gradually over a period of three years. The Biden government expects this measure to raise $3.5 billion within ten years.
US Electricity Consumption in 2022