Brazil Proposes to Tax-Free Green Bitcoin Mining

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Key takeaways:

  • A new proposal in the Brazilian Congress calls for a tax exemption on both the importation of cryptocurrency mining equipment and mining done with renewable energy sources.
  • As per a report published on December 4 by Brazilian news source Seudinheiro, a series of recent recommendations from Brazilian politicians may reduce the amount of criticism crypto would face in South America’s largest country.
  • In Brazil, there are currently energy supply difficulties, and energy restriction is becoming a reality. Rationing refers to the practice of providing fewer amounts of electricity to tiny portions of a rural in order to protect the overall energy system.
Brazil Proposes To Tax-Free Green Bitcoin Mining
Brazil Proposes to Tax-Free Green Bitcoin Mining

A new proposal in the Brazilian Congress calls for a tax exemption on both the importation of cryptocurrency mining equipment and mining done with renewable energy sources.

According to a report published on Dec. 4 by Brazilian news site Seudinheiro, a series of fresh ideas from Brazilian lawmakers could help to minimize the criticism of cryptocurrency in South America’s largest country.

A proposal to classify cryptocurrencies as foreign currency rather than a commodity was also addressed in Congress. If this plan passes, cryptocurrency exchanges will be able to provide financial services and make loans to Brazilian citizens.

Senator Irajá Silvestre Filho presented the congress with three ideas. The legislature’s support for the plans is presently unknown, although the Brazilian crypto community enjoys widespread support.

Irajá Silvestre Filho, also known as Irajá, is a politician and businessman from Brazil. He has been serving as a state senator since 2019 and as state deputy from 2011 to 2019.

If the tax exemption for crypto miners is passed, Brazil may become a global “Mecca of mining.”

Ray Nasser, CEO of Arthur Mining

The Central Bank of Brazil would be able to issue authentic central bank digital currency if cryptocurrencies become legal tender (CBDC). Brazil would join nine other countries or jurisdictions that presently provide CBDCs to their citizens.

According to the International Trade Administration, Brazil now produces slightly less than half of its electrical energy from renewable sources. The cost per kilowatt-hour is approximately $0.12, putting it in the middle of the pack globally.

Taynaah Reis, CEO of Moeda, a Brazilian blockchain finance firm, said:

“CRYPTO IS GROWING RAPIDLY IN BRAZIL AND REGULATORS HAVE BEEN VERY PROACTIVE AND PROTECTIVE IN PUSHING FOR MINING AND THE WRITING OF BEST PRACTICE POLICIES AS LARGE COMPANIES HAVE ANNOUNCED THEIR INTENTION TO INCLUDE CRYPTO.

Miners must also register their equipment with the Brazilian government in order for the ecosystem to be monitored, according to Reis.

There are currently energy supply concerns in Brazil, where electricity rationing is becoming a reality. Rationing is a practice in which certain areas of a rural are supplied with fewer amounts of energy in order to protect the overall energy grid.

Although Brazil has electricity rationing, according to Rudá Pellini, Chairman of Arthur Mining, the addition of Bitcoin miners does not pose a threat to the power supply:

“ONE OF THE MAIN PROBLEMS IN THE ENERGY ISSUE IN BRAZIL IS TRANSMISSION. WE HAVE A LARGE SURPLUS OF ENERGY PRODUCTION IN THE COUNTRY, AND IT IS POSSIBLE TO PROMOTE GREATER INVESTMENT IN THE PRODUCTION OF CLEAN ENERGY.”

In Kazakhstan, which has grown to become the world’s second-largest Bitcoin mining nation, electricity supply has been a persistent issue.

Aadrika Sharma
Aadrika Sharma

I enjoy writing and try to learn new things every passing day!

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