There have been several provisions taken by the European Union (EU) in order to ensure that Bitcoin mining doesn’t have an impact on the environment. This is definitely is one of the major flaws of cryptocurrency mining activities for sure.
According to the best news site for cryptocurrency, the new MiCA bill that has been introduced by the European Union actually has a proper line that is in relation to the sustainability of the environment. Hence, this could create a major problem for the miners of the Bitcoin cryptocurrency in that particular region.
The legal situation related to the mining of Bitcoin in the European Union is dependent on the results of the vote that took place on the 14th of March. The vote was taken in the European Parliamentary Committee and it was related to the different Markets in Crypto Assets or MiCA.
According to the controversial line that was included in the bill, the major concern for bitcoin mining was the minimization of environmental sustainability. This major point was actually taken out of the bill but has been introduced back again by the authorities. This new line will actually require the different operators of blockchain to properly submit an effective rollout plan.
This plan would include all the important details on how the mining activities would have an impact on the sustainability of the environment. In case an operator fails to actually make a submission of the report, they will not be allowed to trade or mine the crypto coins in the European Union.
MiCA Bill Talks About Environmental Effects of Bitcoin Mining
Although it is not specifically stated, the bill would directly affect proof-of-work (PoW) chains. PoW is the consensus algorithm used by the Bitcoin network, Ethereum, and several other crypto assets. However, since Bitcoin (BTC) is decentralized, there can be no rollout plan issued on its behalf. The absence of such a plan may threaten the existence of Bitcoin mining operations across the EU.
The EU accounts for about 12-14% of the global hash power on the Bitcoin network, with Germany and Ireland contributing the majority of that according to last year’s data from Cambridge University and Statista.
Concerns over energy consumption and carbon emissions of Bitcoin mining are now at the forefront of the debate over how the EU should regulate it. However, those concerns start to look out of place when faced with the raw data.
According to a report by Frankfurt School last November, as of August 2021, the Bitcoin network annually required 90.86 Terrawatt hours (Tw/H) of energy. That is about 0.05% of total global consumption. The network is responsible for only around 0.08% of the total global carbon emissions, though these metrics are very difficult to calculate accurately.
French MP Pierre Person warned that a prohibition on mining would drive talent and innovation out of the region. He said in a March 12 tweet that by banning Bitcoin and Ethereum (ETH), and “complicating the use of NFT and DeFi, the European Parliament is mortgaging our monetary and financial sovereignty.”
According to the best news site for cryptocurrency, if the bill is passed as it has been made, there will be no involvement of Ethereum in the process for a very long time for sure. The entire network is supposedly going to complete the process of merging at a certain point in the year 2022, which is the present year.
This will make it a proof-of-stake (PoS) network. Being a PoS network would mean that it will not really need to have any physical mining rigs in order to reach the consensus of the network effectively. However, there might be certain sessions and serious consequences for the miners of Bitcoin for sure.
Also Read: The European Parliament will vote on a crypto bill that does not include a PoW provision.
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