Texas Senate approves Bill that restricts incentives for cryptocurrency miners, advances to House for further consideration.

2023-04-13

Summary: - Texas Senate approves Senate Bill 1751 aimed at limiting incentives for crypto miners - Bill will move to House of Representatives for discussion on April 13 - Advocacy groups, including Chamber of Digital Commerce and Satoshi Action Fund, oppose the bill and plan to rally on April 25 - Proposed legislation would cap incentives at 10% for crypto mining firms participating in program to compensate for load reductions on Texas' power grid and withdraw state tax abatements for certain data center operators from September 2023 - CEO of Marathon Digital Holdings, Fred Thiel, warns bill could lead to reduced revenue and potential relocation of mining firms away from Texas - Thiel sees the push against crypto as an attempt to push it offshore, possibly to countries that the US does not want to have control over the technology.

Full article:

Senate Bill 1751 will next move to the Texas House of Representatives, which is scheduled to meet and discuss legislation on April 13.

Texas lawmakers in the state’s Senate have approved a bill aimed at largely removing incentives for crypto miners operating under the seemingly friendly regulatory environment.

In a 30-1 vote on the floor of the Texas State Senate on April 12, lawmakers in the 88th legislative session passed Senate Bill 1751, legislation that would amend sections of the state’s utilities and tax code to add restrictions for crypto mining firms. The Senate session marked the first time the bill had moved forward in the state government after more than a week, when the Texas Senate Committee on Business and Commerce passed it on April 4.

The bill will next move to the Texas House of Representatives, which is scheduled to meet and discuss legislation on April 13 — though it’s unclear whether lawmakers intend to address SB 1751 at that time. If passed in the House, Texas Governor Greg Abbott — a self-described “crypto law proposal supporter” — will be able to sign the bill into law.

Senate Bill 1751 passing the Texas State Senate on April 12

SB 1751 has garnered national attention from crypto advocacy groups, including the Chamber of Digital Commerce and the Satoshi Action Fund. The organizations have called on Texas residents to voice their opposition to the bill through their local representatives, but also plan to gather crypto mining supporters at a rally at the Texas State Capitol on April 25.

Under the proposed legislation, crypto mining firms participating in a program intended to compensate them for load reductions on Texas’ power grid would have their incentives capped at 10%. Certain companies operating data centers would also not receive an abatement on state taxes starting in September 2023.

“Elected officials only know how to use hammers, they don’t know how to be surgeons,” Fred Thiel, CEO of mining firm Marathon Digital Holdings, told Cointelegraph prior to the Senate vote. “They started whacking at crypto and Bitcoin mining has gotten caught up in the whacking.”

Thiel added that should the bill pass in Texas, some mining firms including Riot Platforms which participate in the energy grid load reduction program would likely see reduced revenue. According to the Marathon Digital CEO, all miners operating in the state would be affected by the tax abatement policy, potentially leading to companies reconsidering Texas as a home — a move that could be interpreted as a part of anti-crypto sentiment at the federal level.

“What politicians are attempting to do now is push crypto and Bitcoin offshore, which is only going to mean that countries that the U.S. doesn’t want having control of this technology will gain control of it.”

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Marathon Digital largely obtains power for its Bitcoin (BTC) mining operations in Texas through a wind farm, an other firms operating in the state include Core Scientific, Riot Platforms, White Rock Management and Argo Blockchain. Core Scientific filed for bankruptcy in December 2022 but continues to mine in Texas, while Argo announced at roughly the same time it planned to sell its Texas facility to Galaxy Digital.

Magazine: Crypto City: Guide to Austin



Source: cointelegraph.com

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