Marathon Digital CEO Fred Thiel warns of the potentially harmful consequences of the Biden administration’s proposed tax on US bitcoin miners. According to Thiel, this political approach could not only push mining companies out of the country, but it would also fail to generate the expected revenue. Discover in this article the reasons why the CEO thinks that such a measure would be counterproductive.
Taxation that scares away bitcoin miners
Crackdowns on crypto businesses in the United States are commonplace. Exchanges such as Binance, Coinbase and others have often been targeted by hostile regulation.
At the Bitcoin 2023 conference, held in Miami, Marathon Digital CEO Fred Thiel expressed concern over the Biden administration’s proposal to tax US bitcoin miners. According to Fred, this political approach simply risks pushing the miners to pack up instead of filling the state coffers.
” Bitcoin miners will simply bid farewell to the United States, and that’s the exact opposite of what the administration is trying to accomplish” , To declared Mr Thiel.
But that’s not all. Thiel also questioned the effect a mining tax would have on the availability of renewable energy. According to the CEO, such a tax would do nothing to stimulate the adoption of green energy, on the contrary, it would even create less of it.
He explains that the construction of solar or wind farms already faces considerable delays for interconnection, which limits the availability of renewable energy. And guess what, it’s the bitcoin miners who, through their economic activity, provide an incentive to accelerate these green energy projects.
Impact on renewable energy and sector oppositions
While cryptocurrency exchanges have come under regulatory scrutiny in the United States, the mining industry has surprisingly escaped that attention. However, Thiel highlights the obstacles faced by bitcoin miners, who face opposition from some players, including the banking lobby and gas-fired power plant operators.
According to Thiel, the cryptocurrency industry poses a threat to the traditional banking sector, which raises concerns among established players. In addition, operators of gas-fired power plants see bitcoin mining as a threat to their own business.
” One of the interests at stake is that of the banking lobby. They don’t want the cryptocurrency industry to disintermediate the banking sector. Bitcoin mining in Texas specifically eliminates the need for power generation plants, which negatively impacts their business. So if they manage to end bitcoin mining in Texas, that just means the power generation plants will be back in business.“.
Marathon Digital CEO Fred Thiel
Despite these challenges, some states, including Texas, are taking a crypto-friendly approach, and Bitcoin mining there is thriving unhindered. However, Marathon Digital remains aware of the aggressive regulatory constraints facing the crypto industry in the United States. As a precaution, the company is already exploring other opportunities beyond national borders. It recently announced a new project in Abu Dhabi and is actively considering new initiatives in countries such as Paraguay.
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