Alex Coin 
Lawmakers in Europe rejected the controversial provision to ban proof-of-work poW is a type of consensus algorithm that rewards validators according to the amount of computational power they have expended. cryptocurrencies ( PoW ) such as Bitcoin.
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Europe will not ban Bitcoin the biggest and most popular cryptocurrency in the world. It is a decentralized digital currency that enables users to make trustless peer-to-peer transactions. nor other cryptocurrencies based on proof-of-work (PoW) mechanisms, for now.
The Parliament of the European Union rejected this Monday a controversial provision that would limit the use of digital currencies based on PoW due to its environmental impact.
The parliament’s economic and monetary affairs committee decided in a vote to annul the provision in question. As a result of the decision, the rule will be left out of the proposed draft framework. ‘ Markets in Crypto Assets ‘, better known by its acronym MiCA, the comprehensive legislative package to regulate cryptocurrencies of the block a file containing information on transactions completed during a given time period. Blocks are the constituent parts of a blockchain. europeo.
Patrick Hansen, strategy leader of the DeFi a movement encouraging alternatives to traditional, centralized forms of financial services. project, Unstoppable Finance The economic committee, he released the information through his Twitter account, citing sources in the economic committee. The provision was rejected after obtaining 34 votes against and 24 votes in favor, according to Hansen. The news media CoinDesk also reviewed the verdict, citing people familiar with the case.
BREAKING: The ECON committee of the EU Parliament just voted against the de-facto POW-ban: 32 against, 24 in favor.
Big relief & political success for the bitcoin & crypto community in the EU????????
Will share a breakdown of the vote and what’s next here in this thread. #Bitcoin
– Patrick Hansen (@paddi_hansen) March 14, 2022
What did the provision say?
As you picked up earlier in the day DiarioBitcoin the provision in question sought to limit the use of cryptocurrencies powered by an energy-intensive computing process known as PoW in the 37 EU member states.
The proposal, which was added to the MiCA draft last week, said expressly that all digital digital technologies are these electronic tools that have the ability to generate, store or even process data. currencies would be “ subject to minimum standards of environmental sustainability with respect to their consensus consensus is achieved when all participants of the network agree on the order and content of the blocks in the blockchain. mechanism used to validate transactions, before being issued, offered or admitted to trading in the Union”. .
It also proposed a phase-out plan to change change — a concept relevant to cryptocurrencies that use the UTXO model — is the number of coins sent back to a user after they use their unspent outputs to initiate a transaction. its proof-of-work consensus mechanism to other methods that use less energy, such as playtesting. This was indicated in a report by CoinDesk who reviewed the document.
As it stood, the regulation would have limited – and possibly prohibited – the use of Bitcoin y Ethereum a decentralized open-source blockchain with smart contracts functionality. ; although the impact on the latter would have been minor, as the second largest cryptocurrency cryptocurrencies are digital currencies that use cryptographic technologies to secure their operation. is upgrading to switch to a proof-of-work (PoS) mechanism.
A similar provision had already been added to the draft MiCA and then withdrawn at the beginning of March after widespread rejection from the cryptocurrency industry. The most recent proposal, although less stringent than the previous one, also received criticism from the cryptocurrency community due to its potentially devastating impact on the cryptocurrency ecosystem. Bitcoin .
Discussion about PoW is not over
According to CoinDesk A small majority of the economic committee voted in favour of a compromise that calls on the European Commission, the EU’s executive arm responsible for proposing new legislation, to offer alternative regulation:
5. By 1 January 2025, the Commission shall submit to the European Parliament and the Council, as appropriate, a legislative proposal to amend Regulation (EU) 2020/852, in accordance with Article 10 of that Regulation, with a view to including in the EU Sustainable Finance Taxonomy any crypto-asset mining activity that makes a substantial contribution to climate change mitigation and adaptation.
The draft MiCA, as it stands, will now go through a trialogue of negotiations between the European Commission, the Council and the Parliament. However, the discussion on PoW is far from over Hansen said.
The groups that lost the vote could still oppose an accelerated MiCA procedure through the dialogues and bring a debate to the full Parliament, the leader explained. “Eso llevaría la discusión en torno a la POW a la arena política de alto nivel. Como no podemos predecir cómo se desarrollaría, debería evitarse. Incluso si no cambia el voto sobre POW, retrasaría innecesariamente el reglamento durante al menos un par de meses“, aggregó Hansen.
Proof of work, and in particular cryptocurrency mining a process where blocks are added to a blockchain, verifying transactions. It is also the process through which new bitcoin or some altcoins are created. activity, has come under heavy criticism from some regulators around the world due to energy concerns; even if it is powered by renewable energy. In Europe, politicians and regulators in Sweden, Spain, Germany, and Norway have been demanding strict measures to stop the mining of Bitcoin since last year.
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Article by Hannah Estefania Perez / DiarioBitcoin
Imagen de Unsplash
