IMF economists propose imposing an electricity tax to reduce the environmental impact of cryptocurrency mining and the AI industry

ChainCatcher news, according to Bitcoin.com, the International Monetary Fund (IMF) published a blog post this week written by Shafik Hebous, Deputy Director of the IMF's Fiscal Affairs Department, and another economist, Nate Vernon-Lin.

The authors emphasized the environmental challenges posed by cryptocurrency mining and artificial intelligence data centers, noting that these sectors already account for 2% of global electricity consumption. They added, "According to our estimates based on projections from the International Energy Agency (IEA), this share could rise to 3.5% within three years."

The report warns that this increasing energy use could lead to cryptocurrency mining contributing 0.7% of global carbon emissions by 2027, and emphasizes, "Expanding the analysis to data centers (according to IEA estimates) means that by 2027, carbon emissions from these sectors could reach 450 million tons, accounting for 1.2% of the global total."

To address this issue, Hebous and Vernon-Lin proposed a targeted electricity tax, stating, "A tax system is a way to guide businesses to reduce emissions. According to IMF estimates, a direct tax of $0.047 per kilowatt-hour would encourage the cryptocurrency mining industry to curb its emissions in line with global targets."

However, critics argue that these taxes could severely hinder the development of the cryptocurrency industry. Additionally, some studies have shown that the environmental impact of cryptocurrency mining remains relatively small compared to other major industries such as e-commerce or traditional finance.