UK is considering banning all Bitcoin ATMs, this new move is particularly ironic.
China already imposed a ban on crypto mining last year.
The mining process, which is how new digital currency is produced, is crypto’s most evident environmental consequence. Many cryptocurrencies depend on mining, but Bitcoin is the most well-known. Unfortunately, it has gotten more difficult to create new Bitcoins via mining since the currency’s launch. Furthermore, there are only 21 million Bitcoins accessible for mining, and minting new ones requires greater processing power as the number of units minted climbs.
There has been renewed worry over the European Union’s plans to prohibit all cryptocurrencies that use Proof-of-Work (PoW) technology because of environmental concerns. This indicates that the European Union might also outlaw Bitcoin.
Regulations Apply to All Digital Assets
Today, the European Parliament will vote on the MiCA framework, which is widely criticized. MiCA’s proposed law contains a provision prohibiting the usage of any digital assets that use a lot of energy. At a time when the UK is considering banning all Bitcoin ATMs, this new move is particularly ironic. European Union regulations apply to all digital assets, according to MiCA.
The provision in MiCA requires all digital assets to be subject to EU’s:
“minimum environmental sustainability standards with respect to their consensus mechanism used for validating transactions, before being issued, offered or admitted to trading in the Union.”
A late amendment to the document aims to restrict the usage of cryptocurrencies powered by proof-of-work, a computational process that consumes a lot of energy.
What the politicians have been working on is tough to understand right now. There has never been a consensus on how much energy should be used for Bitcoin mining. Moreover, China already imposed a ban on crypto mining last year. So despite Elon Musk’s scepticism, Bitcoin’s energy use has been questioned.
However, since mid-2021, the Bitcoin mining business has shifted a lot toward utilizing renewable energy. VanEck Director Gabor Gurbacs lashed out at the EU, saying that if the EU is worried about carbon emissions, it should outlaw plenty of other stuff before Bitcoin.