- There are no specific words aimed at banning Proof of Work coins across the continent.
- The bill still states that crypto assets are “subject to minimum environmental sustainability standards,” the growth director of Unstoppable Finance tweeted.
The final version of the EU’s major legislation, which has sparked controversy over the target of the crypto industry’s Proof of Work (PoW) consensus mechanism, is expected to vote on Monday.
The Markets in Crypto Assets (MiCA) bill, introduced in 2020, seeks to tighten regulations on digital assets by establishing licensing schemes on the continent and streamlining a set of unified rules for member countries.
These rules include transparency and disclosure requirements for the issuance of digital assets, approval and supervision of crypto asset service providers, consumer protection rules, and measures to prevent market abuse.
The bill under paragraph 61 (9c) previously sought to establish a framework that would ban cryptocurrencies from using PoW-based cryptocurrencies such as Bitcoin and Ether. 2025.
Parliamentarians and environmental activists have been pushing for regulation of cryptocurrency mining, citing what they consider to be energy-intensive cryptocurrency activity due to PoW, at least since November last year.
The rule was postponed indefinitely on February 28, following considerable public protest and criticism of the bill, which could slow financial innovation across the region.
“Given the important discussion about sustainability, my suggestion is to include crypto assets in the taxonomy area, like all other financial products,” tweeted. Stephen BergerMember of the European Parliament from Germany on Tuesday.
“The independent discussion of Proof of Work is no longer planned at MiCA.”
Berger is tasked with overseeing the bill and submitted the final bill last week.
To pass a bill within the EU, a parliament representing European citizens and a council representing governments of 27 EU member states must reach an agreement on the same text of a particular bill. This process is often time consuming and tedious. Given the setbacks, each member has about the same voice on issues that affect the region as a whole.
Patrick Hansen, Head of Growth for Unstoppable Finance, said in a tweet on Sunday that crypto assets “must comply with minimum environmental sustainability standards,” so some observers remain vigilant. ing.
Hansen argues that the wording associated with prisoners of war has changed, but that “the effects are essentially the same.”
Existing cryptocurrencies “need to set up and maintain a phased deployment plan to ensure compliance with such requirements,” Hansen tweeted, citing part of the draft document. ..
“There is no way for Bitcoin to implement a deployment plan from PoW, and there is no way to implement it, so it will affect Bitcoin as well.”
The Bitcoin network is highly decentralized and is managed by a social consensus formed by approximately 15,000 full node operators and miners. Changing the proof-of-work consensus mechanism is theoretically possible, but very rare. The Bitcoin White Paper is considered by the Bitcoin community to be a typical feature responsible for the security of transactions on the network. Alternatives without this are not simply considered “bitcoin”, like some controversial hard forks in the past.
The current version of MiCA’s reasonably crypto-friendly language, which is likely to pass the Commission’s vote, is Hansen’s significant improvement over the original text. As mentioned above As a “suicide proposition”.
“It will be in perfect agreement with European values and will kill the entire European crypto industry, one sector in which the EU may actually be competitive.”
Jean-Marie Mognetti, CEO of CoinShares, to protect PoW mining in terms of environmental sustainability Refers to an internal investigation It says, “The potential for miners to reduce flared and vented natural gas carbon dioxide emissions completely offsets all emissions or has a positive impact on net emissions. That’s enough. “
Mognetti said the implementation of a mining ban in Europe would have a negative impact on the block’s environmental goals.
Mika is now heading for a vote within the Economic and Monetary Union (ECON) before being considered at the Trilogue Meeting, Berger said. Representatives of the EU Parliament, the Council, and the European Commission, EU executive branches.
“With MiCA, the EU can set global standards. Strong support for MiCA is a strong signal from the EU Parliament to the technology-neutral and innovation-friendly financial sector.”
Updated, March 14, 2022, 11:14 am ET:
The ECON Committee resolved to move MiCA forward without explicit wording on crypto asset proof of work mining, and clarified how to negotiate a draft at a tripartite dialogue meeting. Patrick Hansen When Blockchain for EuropeBrussels-based industry interest group.
Macauley Peterson contributed to the report of this story.
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