- EU lawmakers’ mandate for the proposed landmark legislation for digital assets.
- European Parliament calls for restricting the use of PoW.
- EU lawmakers are also split on which agency should implement MiCA.
The next 24 hours may be crucial for crypto enthusiasts in the European Union (EU). The lawmakers negotiated a mandate for the proposed landmark legislation for digital assets before it proceeds with the next stage of conferences.
This gets us a step closer to much-needed EU rules, which will guarantee the #crypto assets-industry legal certainty across Europe.
— Blockchain for Europe (@BlockchainforEU) March 24, 2022
The European Parliament’s call for actions aimed at restricting the use of an energy-intensive computing process called proof-of-work (PoW) in the EU could still stall the proposed Markets in Crypto Assets (MiCA) framework. MiCA is the EU’s sweeping regulatory package for cryptos. Meanwhile, EU lawmakers are also split on which agency should implement MiCA.
Last week, relief swept through the EU crypto community after a MiCA draft shed a divisive provision that could have effectively banned bitcoin (BTC) over energy concerns as it passed via a parliamentary committee vote last week.
Head of Strategy at Unstoppable Finance, Patrick Hansen said:
“I am more than relieved that the [committee] voted against the ban of proof-of-work-based assets for EU companies in the end.”
Crypto advocates, including Hansen, told that although there are methods to move Ethereum to proof-of-stake, a consensus mechanism that is less energy-intensive, Bitcoin may not have the same option. Critics of the presented provision also said that proposing Bitcoin could be transitioned out of PoW may have revealed how little lawmakers understand blockchain.
Meanwhile, although the contentious provision was nearly scrapped after last Monday’s vote, it was dumped in favor of an alternative measure that would require the EU Commission, the country arm in order of presenting new legislation in the EU, to come up with a proposal to be included in the EU taxonomy on “any crypto-asset mining activities that contribute substantially to climate change” by 2025.