It appears the anti-crypto sentiment is still pushing forward. The Biden administration is not the only one taking aim at the industry. We now have the Texas legislature turning up the heat.
Before getting into it, we have to realize how quickly the tide can turn. Texas was one of the states that put itself at the forefront when China banned crypto miners. This caused a massive shift of the hash rate around the world. China went from leading the race to giving the title to the United States.
Now, it appears there is a shift in the air, at least in Texas.
Incentives Limited
A bill passed the Texas Senate by a vote of 30-1. It removes incentives for cryptocurrency miners who took advantage of the state rolling out the red carpet to attract them.
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.
This has many within the industry up in arms. It is also an interesting twist since Texas went from pro-crypto to questionable.
“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.”
Here we have another example of the lines being drawn. The ebb and flow of the sentiment is going to be ongoing throughout the politicial season.
When dealing with political winds, things can turn quickly. This is something that is likely to go back and forth over the next 18 months, at least in the United States.
Arkansas Taking The Opposite View
This comes on the heels of a bill in Arkansas that is going to give cryptocurrency miners the same rights as data centers. It removes the potential of them facing discriminatory regulation and taxes.
There are similar bills in Mississippi and Missouri.
Politicians love the headlines that come with companies moving into the state and promising jobs. While cryptocurrency mining companies probably do not employ a great number of people, it is an attention getter.
The point here is we have a split that ends up pitting one side against the other. With Texas moving into the questionable category, these three states are affirming themselves as advocates for the industry.
When it comes to the tug-o-war taking place it is good to get as many allies as possible. The key is simply to have them arrive at a stalemate.
The U.S. Is Going To Push Things Offshore
It seems the United States is intent on pushing things offshore.
Overall, this has nothing to do with the long-term success of cryptocurrency and blockchain. This is global in nature, hence is not dependent upon any single country.
Instead, what is taking place, is the opportunity for countries to thrust themselves into the forefront of the new industry. Technology is one of the few ways that a nation's fortunes can be radically changed. Those that jump on the bandwagon will realize great changes.
Of course, the flipside is that countries which miss the opportunity are going to have a tough time playing catchup. My view is the United States will find itself in this situation.
The developed world is going to have a tough time embracing the new technology. It is going to try to hold onto the status quo. Cryptocurrency is a great equalizer. This applies to nations as well as individuals.
The thrust is going to come from those countries that are presently not enjoying the fruits of the global tree. We see this already with people striving to get involved, at least at the population level. People in regions such as Nigeria, Cuba, and Venezuela understand fully the implications of what is taking place here.
One country that changed its tune was Russia. A few years ago, the nation was anti-crypto. While the population of that country is not likely to freely enjoy the benefits of cryptocurrency, the government realizes that it can be an equalizer against the actions of the West.
This is a battle that is going to be waged over many years. The key is for the industry to keep developing. Having allies in the political battle is a help. Of course, at the end of the day, no matter how much governments go after it, things are beyond their reach.
That piece of Satoshi's vision is still in play. Just like the Eurodollar system, cryptocurrency is out of the reach of governments and central banks.
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