A proposed 5% wealth tax targeting billionaires in California has incited criticism from leading figures in the cryptocurrency sector. This initiative, known as the 2026 Billionaire Tax Act, aims to impose a tax on net wealth exceeding $1 billion to finance healthcare and state assistance programs. The SEIU United Healthcare Workers West union has filed the necessary documentation to include this measure in the November 2026 general election ballot.
Crypto executives, including Bitwise CEO Hunter Horsley and Kraken co-founder Jesse Powell, argue that the tax could result in a significant exit of wealth and talent from the state. They maintain that it may force billionaires to liquidate assets to cover the tax, which can be paid in a single installment or spread over five years with interest. “I promise you this will be the final straw,” Powell stated, emphasizing the potential loss of jobs, philanthropy, and spending.
In contrast, U.S. Representative Ro Khanna, a proponent of the tax, argues that the revenue generated will enhance social services like childcare and education, ultimately benefiting American innovation. Other industry leaders, including Nic Carter and Jeff Park, have expressed concerns over the implications of such a tax on capital mobility, questioning whether a thorough analysis has been conducted on the issue.