The issue of environmental sustainability is a major sticking point in the EU MiCA law.
The European Union’s MiCA bill has been amended to include a phrase on environmental sustainability, which might be troublesome for Bitcoin miners in the region.
The outcome of today’s vote in the European Parliamentary Committee on Markets in Crypto Assets will determine the legal status of Bitcoin mining in the European Union (MiCA).
A contentious language on the “minimum environmental sustainability” of cryptocurrency mining has been reinstated into the draught after earlier being removed. The new line would require blockchain operators to submit a rollout strategy outlining how they intend to meet environmental sustainability standards. Failure to submit a plan may result in coins being prohibited from being mined or sold in the EU.
Although not explicitly mentioned, the measure would have a direct impact on proof-of-work (PoW) chains. The Bitcoin network, Ethereum, and numerous other crypto assets employ the PoW consensus mechanism.
However, because Bitcoin (BTC) is decentralised, no rollout plan can be published on its behalf. The lack of such a strategy may jeopardise the survival of Bitcoin mining operations throughout the EU.
According to research from Cambridge University and Statista from last year, the EU accounts for roughly 12-14 percent of worldwide hashing power on the Bitcoin network, with Germany and Ireland accounting for the majority of it.
Concerns about Bitcoin mining’s energy usage and carbon emissions are now at the centre of the argument about how the EU should regulate it. However, when confronted with raw data, such concerns begin to appear out of place.
According to a November 2018 research from Frankfurt School, the Bitcoin network would consume 90.86 Terawatt hours (Tw/H) of energy annually as of August 2021. This equates to around 0.05 percent of total world consumption. Though these measures are difficult to assess correctly, the network is responsible for just around 0.08 percent of total world carbon emissions.
Pierre Person, a French member of parliament, warned that a ban on mining would drive intellect and creativity out of the region. In a Saturday tweet, he stated that by prohibiting Bitcoin and Ether (ETH) and complicating the usage of NFT and DeFi, the European Parliament is “mortgaging our monetary and financial sovereignty.”
