Time to Ban Proof-of-Work Mining in EU, Move to Proof-of-Stake, Says Securities Regulator
A leading EU financial regulator wants the union to “ban” proof-of-work (PoW) crypto mining and force tokens into proof-of-stake (PoS) paradigms, while the EU itself and the traditional finance sector are reportedly less environment-friendly than Bitcoin (BTC) when it comes to electricity consumption.
The comments came from Erik Thedéen, the Vice-Chair of the European Securities and Markets Authority, the chair of sustainable finance for the International Organization of Securities Commissions, and the Director-General of Sweden’s Financial Services Authority (FSA), who was speaking to the Financial Times. Thedéen redoubled previous claims that Bitcoin mining has now become a “national issue” in Sweden.
Thedéen’s remarks echoed those made in a joint statement from the FSA and thenation’s Environmental Protection Agency last year, when the bodies claimed that only a total ban on PoW mining could help the country meet its Paris Agreement goals – despite a rebuttal of this claim from the nation’s state-owned power provider.
Thedéen was quoted as stating:
“The solution is to ban proof-of-work. Proof-of-stake has a significantly lower energy profile. We need to have a discussion about shifting the industry to a more efficient technology.”
(Learn more: ‘Fiat-Like’ Proof-of-Stake Chains Favor Centralization & Rich Players)
He also stated that BTC mining should not be allowed to eat up large portions of the nation’s renewable power supply.
Last year, Eric Wall, Chief Investment Officer at crypto hedge fund Arcane Assets, took aim at the “armchair googling” activities of Thedéen’s “poorly researched” claims.
Thedéen claimed that he was not in favor of a “wholesale ban” on crypto, however, as “the financial industry and a lot of large institutions are now active in cryptocurrency markets.”
Last year, however, the Swedish regulators claimed that “the social benefit of cryptoassets” was “questionable.”
Earlier today, Cryptonews.com reported that the MicroStrategy CEO Michael Saylor, speaking ahead of the mining industry’s hearing in Congress this week, claimed that the total use of energy in the BTC mining sector is “inconsequential,” and that the industry is “rapidly becoming more efficient.”
And per data compiled by the Bitcoin Mining Council last month, global BTC mining consumes 3.2% of the electrical system energy wasted or lost in the USA in the space of a year. They also claim that Bitcoin mining energy use is 0.142% when compared to the world’s total energy.
Furthermore, per this data, almost 59% of global BTC miners now use sustainable power – compared to nations like Brazil, which uses just over 2% renewable electricity. The USA uses less than 32%, while the EU figure is almost 44%.
Additionally, the council added, BTC mining technology has come on in leaps and bounds, meaning that miners working today are now 5,814% more efficient than those working just eight years ago.
Data compiled by Galaxy Digital last year, also indicated that the banking sector and gold production’s own energy use dwarfs that of Bitcoin – with the lion’s share of power being used to keep the world’s biggest banks’ data centers running.
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