Crypto Market Enters Correction As EU Mulls Banning Bitcoin and PoW Crypto

The crypto market has come under pressure once again ahead of the European Union reportedly working to pass a bill banning all Proof-of-Work (PoW) cryptocurrencies citing environmental concerns. This means that the EU could potentially ban Bitcoin as well!

Bitcoin (BTC) is down 1.5% and is currently trading at $38,577 with a market cap of $730 billion. Other PoW cryptos like Ethereum (ETH) are also trading in the negative zone. Similarly, the correction seems deeper in the altcoin space.

Later today, the European Parliament shall be voting for the controversial Markets in Crypto Assets (MiCA) framework. The MiCA draft legislation includes a clause to ban all energy-intensive digital assets. The latest development comes just as the U.K. proposes a complete ban on all Bitcoin ATMs in the country.

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”. Last week, Circle CEO Jeremy Allaire said:

“Extremely high stakes vote in the EU. That such a proposal made it this far is extraordinarily concerning and unlikely to stand up to practical reality”.

Will the EU Reach A Compromise on the Bitcoin Ban?

Well, it’s difficult today what the lawmakers have been working upon. However, Stefan Berger, the EU parliamentarian who looks after the MiCA framework told CoinDesk:

“The Greens and Socialists, as you can imagine, are criticizing the proof-of-work concept and criticizing the energy use, saying that bitcoin needs more energy than the Netherlands”.

The use of energy for Bitcoin mining purposes has always been a matter of debate. China banned crypto mining last year for this purpose. Even Elon Musk has raised serious questions over Bitcoin’s energy usage.

However, the industry has moved a lot towards the use of renewable power for Bitcoin mining since mid-2021. Lashing out at the EU, VanEck Director Gabor Gurbacs said that they have a lot many other things to ban before Bitcoin if the EU is seriously concerned about carbon emissions.

The EU should consider banning lots of other industries before Bitcoin and PoW if it is concerned about carbon emissions. pic.twitter.com/T4L3dm8iQ1

— Gabor Gurbacs (@gaborgurbacs) March 13, 2022