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EU To Vote On MiCA, Proof-Of-Work Ban Amid Online Backlash

coingape.com 14 March 2022 10:48, UTC
Reading time: ~2 m

The European Union will vote on adopting its Markets in Crypto Assets (MiCA) regulation later on Monday. Reports show that a controversial ban on proof-of-work (POW) tokens including Bitcoin and Ethereum is still being considered, drawing widespread criticism from the crypto community.

The vote is set to take place during a session starting at 8:45 AM ET (1:45 PM CET) today. The POW ban was reintroduced into the MiCA proposal over the weekend, despite initial assurances from the bill’s rapporteur, Member of Parliament Stefan Berger, that the ban will be dropped.

Specifically, EU ministers are expected to vote on approving two versions of the bill, one with the POW ban and one without it. The high energy cost and carbon footprint of mining POW tokens is a sticking point for the EU parliament.

Voting on the MiCA bill had been postponed last month following initial criticism of the POW ban. But EU lawmakers have stressed on the urgency of crypto regulation, citing concerns over use by blacklisted entities to bypass economic sanctions.

POW ban condemned by crypto community.

Members of the crypto community balked at the possibility of a POW ban. Several members of the European Parliament also expressed their opposition to the ban.

French politician Pierre Person said the move would condemn the future of crypto in the EU, and said it would complicate regulation over growing spaces such as DeFi and NFTs.

(7/9) Whether it is DeFi or NFT, these technologies are still in the early stage of development. It is the future use cases that we will have to regulate, not the technology. Parliament is transposing old world financial regulation to a structurally different new technology.

— Pierre PERSON (@Pierr_Person) March 11, 2022

Dutch member of parliament Dorien Rookmaker said a POW ban would encourage legal circumvention and push the crypto industry away from Europe.

Jean-Marie Mognetti, co-founder and CEO at digital wealth manager CoinShares said the move was shortsighted, and ignored the fact that much of PoW mining was now shifting towards carbon-friendly sources of electricity, such as natural gas and renewable energy. Mognetti also pointed out that advances in mining technology were reducing its energy requirements.

At an annualized emissions rate of 41 Million tonnes CO2, the global Bitcoin mining industry has a small environmental footprint relative to the Aviation Industry, Marine Transport Sector, Air Conditioners, Electric Fans, Data Centers, and Tumble Dryers. (4/23) pic.twitter.com/hfXyNMa2Jg

— Jean-Marie Mognetti (J2M) (@jmmognetti) March 13, 2022

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