Texas legislators in the state Senate have voted in favor of a bill designed to largely eliminate incentives for crypto miners taking advantage of the permissive regulatory environment.
On April 12, the 88th legislative session of the Texas Senate passed Senate Bill 1751 in a 30-1 vote, amending parts of the utilities and tax codes to include restrictions for crypto mining firms. This marked the first time the bill had moved forward in the state government after being approved by the Texas Senate Committee on Business and Commerce on April 4.
The measure will now go to the Texas House of Representatives for consideration, with a session scheduled for April 13 — though it remains to be seen if the House will 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.
SB 1751 has drawn attention from crypto advocacy organizations such as the Chamber of Digital Commerce and the Satoshi Action Fund, both of whom have urged Texas residents to voice their disapproval of the bill through their local representatives. Additionally, a rally is scheduled to be held at the Texas State Capitol on April 25 to support crypto miners.
Under the proposed legislation, crypto mining firms participating in a program meant to compensate them for load reductions on Texas’ power grid would have their incentives capped at 10%. Data centers run by certain companies would also no longer be able to receive an abatement on state taxes starting in September of 2023.
“Elected officials only know how to use hammers — they don’t know how to be surgeons,” stated Fred Thiel, CEO of mining firm Marathon Digital Holdings, prior to the Senate vote. “They started whacking at crypto, and Bitcoin mining has gotten caught up in the whacking.”
Thiel went on to explain that if the bill is passed in Texas, some mining firms, such as Riot Platforms, may experience a drop in revenue due to the incentives program. Furthermore, all miners in the state could be impacted by the tax abatement policy, which could prompt companies to relocate to other locales in a manner that could be construed as a manifestation of the federal government’s stance against crypto.
“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 uses a wind farm to power its Bitcoin (BTC) mining operations in Texas, with other firms in the state including 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 around the same time that it would be selling its Texas facility to Galaxy Digital.
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