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Behind the US Tax Adjustment: Hidden Incentives for Crypto Mining

On February 24th, Beau Turner, CEO of Bitcoin mining company Abundant Mines, disclosed that with the US tax law resuming full "bonus depreciation" by mid-2025, eligible Bitcoin mining equipment can now be 100% deducted from pre-tax income in the first year of purchase.🔈🔈🔈
From a tax perspective, this measure will significantly reduce the taxable income of mining companies and investors, improve cash flow and equipment investment efficiency, and is regarded by the industry as a "historic tax optimization tool." The industry has reacted positively to this policy, with many mining equipment manufacturers anticipating increased demand in the US market, which will help alleviate the pressure of rising procurement costs previously caused by tariffs and supply chain restrictions.⏸⏸⏸
However, mining equipment is a high-depreciation asset, and whether its actual lifespan matches its depreciation cycle is crucial. If the mining equipment is technologically obsolete or insufficiently profitable within the tax depreciation period, this aggressive depreciation strategy may actually lead to higher tax costs later. Furthermore, tax incentives may be adjusted with changes in government. Miners who rely too heavily on tax incentives in a single country may neglect the need for diversification to mitigate geopolitical risks.💡💡💡
Overall, the US reinstatement of accelerated depreciation is a substantial institutional boon for the Bitcoin mining industry, potentially triggering a new round of mining equipment purchases and asset allocation, and accelerating overall capital investment and technological upgrades within the industry.
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