Proposed EU Regulation Could Limit BTC and Crypto Mining

The proposed EU regulation could limit Bitcoin and the proof-of-work crypto mining process because of the concerns over its energy consumption so let’s find out more in today’s latest Bitcoin news.

The European Union is drafting regulations that could result in a ban on proof of work crypto mining acorss the 27 members states in the region. The Proposed EU Regulation is a part of the upcoming Markets in Crypto Assets legislation that will govern the regulation of crypto in the EU. The draft bill package includes a provision that can ban the proof of work mining in the union. The news came after the growing concerns across the EU over the environmental impact caused by the PoW mining and the energy-intensive mechanism used by crypto assets like BTC or Ethereum.

Last year we saw Sweden’s financial supervisory authority calling for a ban on crypto mining. The regulator said at the time:

“Sweden needs the renewable energy target by crypto-asset producers for the climate transition of our essential services, and increased use by miners threatens our ability to meet the Paris Agreement. Energy-intensive mining of crypto assets should therefore be prohibited.
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The same concerns were voiced by the vice-chair of the European Securities and Markets Authority who now serves as director-general of the Swedish regulator, Erik Thedeen. He told the Financial times that BTC mining become a national issue for Sweden:

“We need to have a discussion about shifting the industry to more efficient technology. The financial industry and a lot of large institutions are now active in cryptocurrency markets, and they have [environmental, social and governance] responsibilities.”

According to Cambridge University, the BTC network consumes up to 120 terawatt-hours of electricity and this is more electricity consumption per year than most of the world’s countries. The Cambridge University found that only 39% of the BTC network was powered by renewable energy and using these numbers, the researchers found that the BTC network annual greenhouse gas emissions were equivalent to 60 billion pounds of burned coal however the concern is now extending beyond the network’s lack of renewable energy sources.

Some BTC critics say that the use of renewable energy to mine crypto is actually a misallocation of valuable resources, as the founder of Digiconomist Alex de Vries once said:

“I’ve been saying for a long time you cannot sustainably waste resources—using renewables for crypto mining is no solution.”