In June of 2021, China made waves when it halted all domestic cryptocurrency mining and subsequently outlawed cryptocurrencies entirely in September. Following Beijing's decision, there were worries about where large-scale mining companies might relocate their operations next, with China accounting for majority of the world's mining activity prior to the crackdown.
GEM Mining CEO John Warren feels that the United States has been able to fill the void left by China's withdrawal from the cryptocurrency market.
“What you've seen over the past years with China shutting down, Kazakhstan shutting down, [is that] North America — and specifically the United States — has really become the Bitcoin (BTC-USD) mining capital of the world,” Warren told Yahoo Finance Live. “And I think that's a positive thing for the United States.”
The American South is gradually becoming as one of the most popular locations for bitcoin mining and other crypto-related businesses. Tax incentives and affordable renewable energy are attracting miners to places like Texas and Georgia.
"What you've seen over the last few years with China and Kazakhstan shutting down, [is that] North America — and primarily the United States — has turned into the world's Bitcoin (BTC-USD) mining capital," Warren told Yahoo Finance Dwell. "I feel that is a positive aspect for the United States."
Warren was on Yahoo Finance Dwell to discuss the migration of bitcoin mining to the United States, the utility of crypto mining, and sales tax exemptions. GEM Mining, situated in Greenville, South Carolina, is a privately held, institutional-grade bitcoin mining company that mined over 600 Bitcoin in 2021 (worth more than $25 million).
South America is crypto-friendly.
The American South is quickly becoming one of the hottest spots for bitcoin mining and other crypto-related businesses. States like Texas and Georgia are becoming hotspots for miners who have been banished from other countries as a result of government crackdowns due to tax incentives and cheap renewable energy. Politicians in those states are also thrilled about the increased employment and tax revenue.
Although cryptocurrency mining consumes a lot of energy, Warren claims that GEM Mining plans to be carbon neutral by 2026. Currently, the corporation is active in six states. And, according to Warren, energy accessibility is a key factor in determining which parts of the United States to expand in.
"My company, GEM Mining, is 97 percent carbon neutral." Only a few companies in the United States can make that claim. However, as you are aware, vitality is a critical component. And certain states are particularly friendly to miners."
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Warren hailed Kentucky as a trailblazer for putting crypto tax incentives into law, citing sales tax exemptions as a way to make states more appealing to mining companies. With overwhelming support, Kentucky passed HB230 in March 2021, which "grants gross sales and use tax exemptions on tangible private property directly used and electrical energy used in company mining of cryptocurrencies."
"Getting a sales tax exemption for all of the miners is one of the most important problems," he remarked. "I mean, we've spent almost $300 million on miners lately." If you don't have to pay the gross sales tax, that's a huge profit. Finally, the miners are located in states where they are exempt from paying sales taxes."
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