The most important part of Trump’s “big and beautiful” tax bill for the crypto industry

After a closely contested vote that called on Vice President J.D. Vance to cast a tiebreaker to make a decision, the US Senate approved President Donald Trump’s extensive tax and spending package known as “One Big Beautiful Bill.”

The bill, which passed 51-50, is now moving to the House, which has already sparked a famous feud between President Trump and tech billionaire Elon Musk, creating a mixed signal for the crypto market.

What does Trump’s megabil mean for cryptography?

The Senate version of the bill did not include major crypto-specific modifications, such as Senator Cynthia Ramis’ proposal to address staking and mining taxes, but the broader impact on the market appears to be positive.

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The bill features significant tax cuts, including elimination of taxes on tips and overtime pay, which will increase disposable income for millions of Americans. Historically, such increased consumer spending is often correlated with rising Bitcoin prices, as investors adopt a more “risk-on” stance.

Hidden incentives for Bitcoin Miners

A lesser but potentially important provision in the bill is the recovery of a 100% bonus depreciation for capital investments. The rules allow businesses purchasing new equipment, such as Bitcoin mining rigs, to immediately deduct all costs from their taxable income, rather than years or more.

This strong tax incentive is expected to encourage mining companies to expand their operations in the US, which will increase the overall hash rate of Bitcoin and enhance network security.

Why did the bill cause a feud with Elon Musk?

The bill introduces tax cuts, but also requires cuts in healthcare and green energy financing. This sparked public disagreements between President Trump and Elon Musk, criticising the bill’s meaning and suggesting distance from government partnerships. Following the Senate vote, Tesla stocks have declined with a slight decline in Bitcoin, reflecting a pattern in which both assets often move in parallel between major political events.

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Musk’s comments, including lightly mentioned references to the bill and potential impact on future core businesses, have attracted attention within the crypto community. Furthermore, Dogecoin was mentioned in the discourse, humorously linked to Mask’s previous “government efficiency.”