thecoinrise.com
The call by Swedish authorities to ban all forms of Proof-of-Work (PoW) mining activities has attracted a backlash from the investment manager, Melanion Capital. According to the Swedish Financial Supervisory Authority and Swedish Environmental Protection Agency, Bitcoin mining is damaging to the environment and places undue strain on electricity networks, thus necessitating their call to impose an EU-wide ban on Bitcoin.
Melanion Capital believes that “the claim that Bitcoin miners jeopardize the power grid is completely wrong,” and the France-based firm also posited that the business model of Bitcoin miners is likely to collapse when demand for electricity increases, as this would also increase energy prices.
Melanion Capital pointed to the government watchdogs that have embraced Bitcoin mining, particularly Texas, noting that rather than being tagged as energy drain, the mining activities can be complementary to renewable energy generation, “as they capture wasted energy and provide a baseload for a volatile resource like wind or hydropower.”
The Melanion Capital statement admonished watchdogs to embrace miners rather than enact policies that will strain them out. The firm said that the fact that the decentralized nature of the industry does not imply that regulators should put forth rules that can hamper the growth the industry has been building for more than a decade.
“The absence of such a political counterbalance [for Bitcoin miners] should not be taken as an opportunity to implement measures rendering illegal an industry for its lack of defensive powers.”
Advocating for Bitcoin Mining: Learning From El Salvador
There have been many approaches to Bitcoin mining regulations amongst authorities around the world, most of which have been unfavorable for miners and the industry as a whole. While Chinese authorities imposed a nationwide crackdown on the nascent asset class, the United States, Canada, Russia, and Kazakhstan have been quite welcoming.
While these nations’ examples are worth emulating, El Salvador is taking the Bitcoin mining narrative to a whole new level as the government is building mining farms billed to be powered by the nation’s volcanic geothermal energy. While other countries are not strict with miners, El Salvador is setting a unique example by going all out on digital currency, irrespective of the criticisms to its approach by Ethereum’s co-founder, Vitalik Buterin as reported by TheCoinRise.
Bitcoin mining can either be beneficial or harmful in relation to the source of energy, and the approach to sourcing the coin by El Salvador lends credence to the beneficial models of BTC mining as a whole.