Europe rejects proposal limiting PoW cryptos


Europe rejects proposal limiting PoW cryptos 

Europe rejects proposal limiting PoW cryptos

The European Parliament has voted against a proposed regulation aimed at banning Proof-of-Work (PoW) cryptocurrencies in the EU over concerns about carbon dioxide emissions in the mining industry. Bitcoin and Ethereum  are the biggest cryptocurrencies using mining for network validations

Cryptographic proponents say the debate misses the point, especially as Bitcoin is increasingly using renewable energy sources. Even the carbon dioxide emissions of BTC mining across the EU are negligible compared to other sectors.

The European Parliament's Committee on Economic and Monetary Affairs (ECON) voted 32 to 24 on Monday afternoon in opposition to the proposal. Instead, the Commission has passed a proposed regulation that adds Bitcoin to the EU classification for sustainable finance.

What may be banned is part of a larger rules framework known as the Markets in Crypto-Assets (MiCA) framework. In reality, it just means more rules for the European Bitcoin market.

Market bailout

Voting against the ban is a great relief for the cryptocurrency industry. Representatives had previously warned of the threat of hard-line scenarios.

The MiCA is a regulatory framework that includes 126 articles and also includes a detailed plan for the implementation of these regulations for the EU and its member states.

Patrick Hansen, Head of Strategy and Business Development for the Defi Platform Unstoppable Finance, calls this "a great relief and political success for the EU's Bitcoin and crypto community."

“MiCA regulates financial products and financial service providers. It makes much more sense to address the sustainability concerns of mining technology individually,” Hansen said.

According to Hansen, MiCA's design will probably go through a two-month "trialogue" negotiation phase. As a result, the European Commission, Parliament, and the Council will all consider this regulation.

The bill then became a law, which companies would follow for up to six months, but strategists say this is unlikely to lead to a Bitcoin ban.

"The group that lost the vote has the last option. It can veto the MiCA acceleration process by the Estates-General and bring the discussion to the plenary session of Congress. To do so, 1 / of the EP. We needed 10 votes and they got it. " This move may still be the mood, but it doesn't mean that PoW will not be discussed outside of MiCA regulations.


This design was introduced by the European Commission in 2020. This is part of our digital finance strategy. MiCA covers a wide range of cryptocurrency topics, including the status of all major currencies and stablecoin. It also describes the activities of mining and exchange platforms.

There are also some notable exclusions. For example, in the case of digital currencies issued by central banks, he could be CBDC, security tokens, NFTs, Defi, etc.

Voting on design types

At this conference, there is an important agenda that voting may be held for two different versions of the design. One of them contains a wording that prohibits all cryptographic transactions on the PoW protocol. This rule is in line with the obligations to the provider.

You must also submit a detailed plan for compliance with environmental and sustainability standards. But in the case of Bitcoin, we cannot provide these details.

Detailed plan

Detailed plan submission also applies to some other decentralized systems. This is because there is no central operator or individual or collective decision-making.

For this reason, the version has already been upgraded. That is to help us break these regulatory impasses.

The final version of MiCa

Finally, the final version of MiCa is displayed. However, it is not supported by most MEPs.

Patrick Hansen reports that 32 members of the ECON committee have voted against the restricted version. Only 24 people vote in favor, said the chief strategy officer of Unstoppable Finance.

This minority is made up of leftist parties. They are mainly members of the Green Group.

No ban on mining by PoW

A more modest version of MiCa is currently being introduced by EU institutions. It does not contain any direct or implied prohibitions on mining using PoW.

All mining activities related to EU tax-based crypto assets for sustainable finance should be included.

Excluded from assistance

Cryptographic mining is still classified as an unsustainable activity until 2025. It remains possible to be excluded from investment by companies and governments.

However, this is still far from a total ban. Its issuance could significantly change the way cryptocurrencies are in Europe.

The next step for MiCa is triple processing by the European Parliament, the European Commission, and the Council of the European Union.

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