Paris Member of Parliament Pierre Person announced on March 11th, 2022 that the updated MiCa proposal prohibiting the exchange of crypto-assets that require Proof-of-Work to execute transactions would be signed. The proposal would include banning networks like Bitcoin, Ethereum, and any other crypto-asset the parliament deems too “energy intensive”.
The MiCa proposal was originally introduced by parliament in 2020 to provide clear regulatory guidance for how citizens and businesses should operate their daily spending with cryptocurrencies. The proposal is also intended to protect users and investors from privacy exploits and loss of funds.
Person states that the MiCa proposal is no longer conducive to the potential innovation and economic boom that Bitcoin and cryptocurrencies offer. Person goes on to say that the addition of banning Proof-of-Work based cryptocurrencies may lead to “deadly regulation” that will condemn the development of businesses and economies within the EU.
Bitcoin and cryptocurrency miners around the world seek the cheapest possible energy sources in order to increase revenues. Person recognizes that the EU would benefit from banning miners that use fossil fuels and instead encourage miners to rely on surplus energy sources. These surplus energy sources would include gas flaring, hydroelectric power, or “green” technologies that produce too much energy.
Person goes on to say that there is a disconnect between what the EU are insisting to be issues with Proof-of-Work mining and the possible benefits for all parties involved. Other assets that may require further clarification are NFTs and DeFi. Person claims that the EU is imposing “old world financial regulations” on assets that have yet to mature and are still developing.
In contrast, the U.S. has recently released a more favorable approach to Bitcoin and cryptocurrency regulations. Person points out the vastly different approaches from both nations and is calling upon the EU to reconsider the proposal. “We will pay the price in terms of our competitiveness and the interests of European citizens,” he states.