Bitcoin miners have dodged a new tax. Next time they might not be so lucky.

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Bitcoin miners appear to have dodged a bullet, as Congress’ debt cap bill does not include a hefty crypto tax that the White House had proposed. But investors should be wary of future budget battles. Such proposals tend to rise from the ashes.

Over the weekend, lawmakers released the text of a bill that would raise the debt ceiling for two years while adding federal spending limits. The draft did not include a provision, previously proposed by the White House, that would have imposed an excise tax on crypto miners equal to 30% of the cost of the electricity they use.

The White House had argued that the so-called DAME (Digital Asset Mining Energy) tax would offset the economic and environmental costs of crypto mining. Bitcoin miners were fiercely against it.

Such a tax would have significantly reduced the profits of miners such as Marathon Digital Holdings (ticker: MARA) and Riot Platforms (RIOT), whose shares have risen 181% and 267% this year. respectively, on the back of Bitcoin’s rebound.

But declaring an outright victory is premature, some political analysts say, because such proposals tend to come up every time Congress seeks funds to pay new bills.

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Any suggestion that the industry is immune to future tax efforts simply because the DAME tax was left out of the debt ceiling deal is detached from reality, says Isaac Boltansky, director of policy research of the BTIG. He noted that the tax would have raised about $3.5 billion over 10 years.

Support for Bitcoin and the crypto industry has not traditionally fallen cleanly along partisan lines. In the past, Republicans and Democrats have expressed support for promoting an industry they see as having the potential to be a major job creator. However, since last year’s crypto crash, more Democrats have attacked the digital asset industry, with President Joe Biden this month even hammering Republicans for taking a stance on the cryptocurrency cap. debt that he says protects wealthy tax evaders and crypto traders.

Crypto miners, who operate huge server farms that consume a lot of power, have been one of the most frequent targets of Democrats, who cite environmental concerns. In New York, lawmakers passed a partial ban on crypto mining. Even in Republican-controlled Texas, bitcoin miners recently battled a bill that would limit their participation in programs that pay them to shut down during times of high electricity demand.

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Targeting a specific type of energy use in an effort to save energy is an invasion of people’s right to choose how they use the energy they pay for, Marathon CEO Fred Thiel said. in a statement to Barrons. He argued that the proposed tax would not have benefited the environment or the energy grid.

This time, miners have benefited from Republicans’ insistence that a debt cap bill not include new taxes, Boltansky says, but that won’t necessarily be the case in future battles. .

Once an item is on the legislative menu, it tends to stay in the political conversation, Boltansky says.

Email Joe Light at [email protected]

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