Texas Senate approves measure restricting incentives for cryptocurrency miners, advancing to House.

Lawmakers in the Texas Senate have endorsed a bill that seeks to significantly diminish incentives for cryptocurrency miners functioning within the seemingly accommodating regulatory framework.

In a 30-1 vote during the Texas State Senate session on April 12, legislators in the 88th legislative session approved Senate Bill 1751, which proposes amendments to parts of the state’s utilities and tax code to impose new restrictions on crypto mining companies. This Senate session represented the first advancement of the bill within the state government after more than a week, following its passage by the Texas Senate Committee on Business and Commerce on April 4.

The bill is set to proceed to the Texas House of Representatives, which is slated to convene and deliberate on legislation on April 13 — although it remains uncertain if lawmakers will consider SB 1751 at that time. If it is approved by the House, Texas Governor Greg Abbott — who identifies as a supporter of “crypto law proposals” — will have the opportunity to enact the bill into law.

Senate Bill 1751 passing the Texas State Senate on April 12.

SB 1751 has attracted national interest from cryptocurrency advocacy organizations, such as the Chamber of Digital Commerce and the Satoshi Action Fund. These groups have urged Texas residents to express their disapproval of the bill through their local representatives and are also organizing a rally at the Texas State Capitol on April 25 to gather support from crypto mining advocates.

The proposed legislation stipulates that crypto mining companies engaged in a program designed to compensate them for reducing load on Texas’ power grid would have their incentives limited to 10%. Additionally, certain companies operating data centers would no longer receive a state tax abatement 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 company Marathon Digital Holdings, remarked to Cointelegraph prior to the Senate vote. “They started whacking at crypto, and Bitcoin mining has gotten caught up in the whacking.”

There is an anti-bitcoin mining bill up for vote by the Texas Senate tomorrow (4/12/2023)@BitcoinPierre @lee_bratcher @KristineCranley @Dennis_Porter_ have been on the frontlines lobbying against this bill.
In this , let's dive into what this bill is and how YOU can help. pic.twitter.com/vlcosKWyMu

— Martin K. (@builtbymartink) April 11, 2023

Thiel further stated that if the bill is enacted in Texas, some mining companies, including Riot Platforms, that are part of the energy grid load reduction program would likely experience diminished revenue. According to the CEO of Marathon Digital, all miners operating within the state would be impacted by the tax abatement policy, which could lead firms to reconsider Texas as their operational base — a shift that might be seen as part of a broader 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.”

Related: Texas lawmaker introduces resolution to protect Bitcoin miners and HODLers

Marathon Digital primarily sources power for its Bitcoin (BTC) mining activities in Texas from a wind farm, while other companies 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 its mining operations in Texas, whereas Argo announced around the same time its intention to sell its Texas facility to Galaxy Digital.

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