Removing Proof-of-Work Prohibition in Proposed EU Regulations
A sentence that threatened to ban crypto companies from relying on power-intensive proof-of-work (PoW) mining has been removed from the proposed Crypto Asset Markets (MiCA), legislation designed to regulate the European cryptocurrency sector, Bitcoin.com reported Thursday. (3rd of March).
The European Parliament was expected to approve the proposal in February, but the vote was postponed after cryptocurrency industry advocates raised objections.
The text, put forward by members of the Left, Green and Social Democrat parties, would have prohibited companies from offering PoW-based crypto asset buying, custody and trading services. PoW refers to a system that requires efforts to deter frivolous or malicious uses of computing power, such as spam.
The vote was canceled at the request of Stefan Berger, member of the European People’s Party.
“We now want to get the MiCA through Parliament as quickly as possible,” Berger said. “The talks are in full swing.
Regulators and government officials across Europe have called for a ban on PoW mining, noting that it is necessary to use considerable electrical power in such operations. In January, the vice president of a European Union regulator called on all 27 member states to ban energy-intensive cryptocurrency mining.
Read more: Regulator: EU Should Ban Crypto Mining Method That Uses Large Amount of Energy
Erik Thedéen, vice president of the European Securities and Markets Authority (ESMA), said bitcoin mining has become a national problem for his native Sweden and warned that cryptocurrencies are exacerbating climate change. Instead, he argued that the industry should adopt a proof-of-stake model that uses less energy.