On Monday, a finalized version of a major EU bill that sparked controversy due to its targeting of the crypto industry’s proof-of-work (PoW) consensus method is set to be put to a vote.
EU will vote on a crypto bill without a proof-of-work ban
The draught legislation, Markets in Crypto Assets (MiCA), introduced in 2020, aims to tighten regulation around digital assets by establishing a licensing scheme across the continent and developing a consistent set of norms for member states.
Transparency and disclosure requirements for digital asset issuance, authorization, and supervision of crypto-asset service providers, consumer protection standards, and market abuse prevention measures are among the rules.
MEPs voted in favor of establishing a legal framework for crypto-assets across the European Union. This comprises anti-market manipulation and anti-financial-fraud measures, as well as consumer protection.
MEPs have requested the European Commission to include crypto-assets mining in the EU taxonomy (a classification system) for sustainable activities by 2025, in order to reduce the carbon footprint of the cryptos.
The law also intended to establish a framework forbidding crypto services from using PoW-based cryptocurrencies like bitcoin and ether under paragraph 61 (9c). That part of the law, which has subsequently been modified, was scheduled to go into force in 2025.
Since November of last year, lawmakers and environmental groups have been lobbying for crypto mining legislation, citing what they see as energy-intensive crypto activities deriving from PoW.
To approve legislation in the EU, the Parliament, which represents European citizens, and the Council, which represents the governments of the EU’s 27 member states, must agree on a single bill’s wording. Given that each member has an equal say on problems impacting the region as a whole, the process is often time-consuming and riddled with setbacks.
In a Tweet on Sunday, Patrick Hansen, Unstoppable Finance’s head of growth, pointed out that the document still stipulates that crypto assets “must be subject to minimal environmental sustainability requirements.”
they should do their utmost to incentivize miners to set up operations in western jurisdictions. Especially in Western Europe. (12/23)
— Jean-Marie Mognetti (J2M) (@jmmognetti) March 13, 2022
Berger added that MiCA must now pass a vote in the Committee on Economic and Monetary Affairs (ECON) before being examined in a trilogue meeting, which brings together representatives from the EU Parliament, Council, and the European Commission, the EU’s executive branch.
“The EU can set worldwide norms with MiCA,” Berger stated. “The EU Parliament’s robust support for MiCA is a significant signal for a technology-neutral and innovation-friendly banking sector.”
Also read: Michael Saylor: Banning Bitcoin will be a trillion-dollar mistake
