[skybrian]

Yes, I know. Something needs to be done about demand. A tax on holding bitcoin might convince honest individuals and businesses (who pay their taxes) to sell. It might not be enough but it would help.

Make the tax proportional to mining revenue, and maybe the "set in stone" rule would be reconsidered?

[incrudible]

A tax on CO2 emission would reduce the incentive to mine with expensive coal without affecting price at all. Moreover, it would reduce the incentive to do all sorts of inefficient things that aren't even on your radar, because it's not the moral panic of the day. It would also increase the incentive to develop carbon capture and CO2-neutral solutions.

[skybrian]

I agree. All the best economists recommend a carbon tax.

Such laws are difficult to pass, though. A tax on proof-of-work contests would politically be easier and encourage switching to better algorithms.

Best would be to do both. It's good to have incentives both to switch away from fossil fuels and to switch away from proof of work.