Due to the energy crisis, cryptocurrency mining may be banned in Europa

The European Union wants to reduce the burden on the energy sector and has already prepared an action plan for this purpose. According to the document, «if there is a need to reduce the load in the electricity systems,» EU member states should prepare to suspend cryptocurrency mining for an indefinite period of time.

Given «the current energy crisis and the increased risks predicted for the coming winter,» the European Commission called on EU members to crack down on cryptocurrency miners and reduce the electricity consumption for cryptocurrency minting. The document informs that 0.4% of the world’s total electricity consumption is consumed by miners: «Most of the consumption is associated with the relatively outdated Proof-of-Work consensus mechanism, which is nevertheless used in the operation of the most popular cryptocurrency (bitcoin).» In addition, the European Commission insists on the abolition of tax exemptions and other bonuses for companies specializing in Proof-of-Work.

By 2025, the EU has pledged to prepare a report describing the impact of cryptocurrencies on the environment and the possibilities of mitigating the effects of climate-damaging technologies, such as the transition of Ethereum to Proof-of-Stake.

Earlier, the EU reached a joint decision on the wording of the MiCA law, which will pave the way for a pan-European regulatory policy on digital assets. The EU Committee on Economic and Monetary Affairs voted in favor of the new package of laws. The vote itself, however, took place without further discussion of the document’s provisions. Experts emphasized that this indicates that the European Parliament will approve the law by the end of this year.

Last week, the European Commission announced a tender for regulators of Eurozone member states to study ways to automate the collection of data on DeFi activity on the Ethereum network. The document states that the open source code of the second largest cryptocurrency’s decentralized finance (DeFi) projects and blockchain «will facilitate the identification of DeFi levers by supervisory authorities.» The pilot project is designed for at least six months and is estimated at 250,000 euros (approximately $ 242,500).