The MiCA proposal has been drafted for regulating crypto markets throughout the European Union. Changes had been suggested to the proposal shortly before it was scheduled for voting because otherwise it would have resulted in a ban on Bitcoin and some other cryptocurrencies. However, a report has disclosed that the ban might still be a possibility, even after the changes. Even though the amendments to the proposal had removed the wording that would have resulted in a ban on coins mined through the proof-of-work (PoW) mining method, it appears that a few members of the European Parliament have now shifted their aim towards ‘unsustainable’ cryptocurrencies.
The draft legislation for the Markets in Crypto Assets (MiCA) in Europe had initially comprised of text that banned crypto services related to those that used the energy-intensive mining method. However, after this provision had resulted in backlash from the crypto community and industry, the text had been deleted. Nonetheless, this has not slowed down efforts in the European Union to impose a ban on digital currencies like bitcoin. On Friday, some amendments were proposed to the legislation, which is aimed at putting a ban on cryptocurrencies that are deemed ‘unsustainable’.
This comes just days before the legislation is scheduled for a vote by the Committee on Economic and Monetary Affairs (ECON). The difference is that the amendments have not mentioned the Proof-of-work (PoW) mining method in this round, but the final result is expected to be the same. According to reports, the amendments dictate that crypto assets would be required to comply with the minimum standards of environmental sustainability where their consensus mechanism is concerned. This mechanism is used for validating transactions involving the crypto and it would not be issued, admitted or offered in the EU.
The authors behind the amendment said that these crypto would have to adhere to the sustainability requirements. ECON is scheduled to vote on the proposal on Monday and if gives its support to it, then it would mean that all services related to bitcoin would not come under the umbrella of regulated activities. Unstoppable Finance’s head of growth and strategy, Patrick Hansen tweeted about the changes in the amendments. He said that the PoW amendment had basically been incorporated in the draft once more that will be voted on in the European Parliament on Monday. The report also noted that if the vote is positive, it would have devastating consequences for the crypto community.
The digital assets market in the European Union would become paralyzed because of a ban on all cryptocurrencies that use the proof-of-work (PoW) mining method. In addition, it would weaken the consumer protections available, encourage law breaking and eventually drive many businesses out of the EU. Regulators and officials from a number of member states, including Germany, have been calling for a ban on the energy-intensive mining method for the past few weeks due to its environmental impact. In fact, non-EU countries, such as Norway, have also considered supporting the same stance.