Europe's MiCA almost banned the holding of Bitcoin and Ethereum, because they consume electricity!
The Markets in Crypto-Assets Regulation (MICA) was presented on Monday March 14 at the European Parliament’s Committee. MiCA's supposed intent is to be brought in to complement anti-money laundering (AML) rules and enhance financial stability and investor protection in Europe, however in its current form MiCa prohibits the issuance or offering for exchange of crypto-assets that rely on Proof-of-Work protocols. This could lead to a deadly regulation that excludes Bitcoin and other crypto assets functioning under a PoW protocol from Europe.
Sesterce through the support of ADAN (Association of EU companies in Digital Assets) showed strong opposition to any ban on #PoW activities in the EU, and warned multiple shortfalls and adverse effects of the proposal.
Fortunately, the European Parliament’s Committee on Economic and Monetary Affairs has voted against a bill that would outright ban proof-of-work (PoW) cryptocurrencies such as Bitcoin (BTC) and Ethereum (ETH).
30 members of parliament voted against a Markets in Crypto Assets (MiCA) bill amendment seeking to ban PoW cryptocurrencies within the European Union.
A total of 23 members of parliament voted in favor of the ban, while 6 abstained from voting.
The majority of those who voted for the ban were from the Green faction and the Progressive Alliance of Socialists and Democrats (S&D).
The way forward
What happens to MiCA?:
Although the MiCA didn't go through in the parliament, alternative amendments were proposed by MEP and supported by parliament with the likes of Stefan Berger propositions. MiCA will regulate financial instruments and financial service providers.
Below are few highlights.
- Mining & any concerns around the sustainability of mining technology will no longer be addressed within this MICA regulation, but added to the EU sustainable finance taxonomy. A compromise draft from Dr Stefan Berger
- Mining will in all likelihood no longer be addressed within this MICA regulation, but added to the EU sustainable finance taxonomy. The EU taxonomy is a classification system, establishing a list of environmentally (un)sustainable economic activities. It provides companies, investors & policymakers with definitions for which economic activities can be considered sustainable.
The taxonomy has a huge influence over where companies, investors & states (can) invest their money and subsidies. And the more environmental laws pass, the more that influence will grow.
- Also The ECON committee of the EP voted in favor of entering the "trilogue" negotiations between the EU Commission, parliament & Council based on the final regulation draft. This mandate to enter the next steps will be announced in a plenary session of the EP on 23/24 March.
PoW falling under sustainable finance taxonomy: What does this mean for POW & BTC?
In near future, if POW gets deemed as unsustainable under the taxonomy, mining companies would have a much harder time getting money from European investors, companies, and governments that have to allocate more and more of their capital towards green objectives. Although it might seem like a bleak, but it is a great improvement from the outright ban which was being proposed.
Here is official press release from EU parliament: 🔗Official PR
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