European regulator calls for ban on power hungry cryptocurrency mining modes
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European regulator calls for ban on power-hungry cryptocurrency mining modes

Erik Thedéen, vice-chair of the European Securities and Markets Authority (ESMA), called for a ban on energy-intensive cryptocurrency mining practices in the region and also drew attention to the growing amounts of renewable energy being spent for these purposes.

Image source: Gerd Altmann / pixabay.com

Image source: Gerd Altmann / pixabay.com

Mr. Tedeen said that bitcoin mining in his native Sweden was already reaching the proportions of a “national problem” and that cryptocurrencies in general were a risk factor in reaching the goals set out in the Paris Climate Agreement. In his opinion, the European authorities should consider banning cryptocurrency mining using the proof-of-work method, leaving only the less energy-intensive proof-of-stake model in the legal arena.

The Bitcoin and Ethereum cryptocurrencies are based on the proof-of-work model, which involves a large number of network participants to confirm each transaction, compared to the proof-of-stake model, which involves the number of participants involved in each transaction Transaction parties involved is much smaller. According to Blockchain.com, mining is a very profitable and competitive business, and the total capacity of the devices used for it is constantly growing.

As early as November last year, the Swedish authorities proposed a ban on energy-intensive mining of cryptocurrencies, as more and more renewable energy is used for this “The societal benefit of crypto assets is dubious”. Mining is increasingly criticized for its environmental impact – according to the Cambridge Bitcoin Electricity Consumption Index, the largest cryptocurrency accounts for 0.6% of the world’s electricity consumption, and that’s more than all of Norway consumes.

Faced with criticism and drastic measures from China, miners began to switch to renewable energy, but the public does not like it either: clean energy is spent on cryptocurrencies and does not contribute to the general rejection of fossil sources. Although the world’s second-largest cryptocurrency, Ethereum, will switch to a cheaper proof-of-stake model in June.

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Robbie Elmers

Robbie Elmers is a staff writer for Tech News Space, covering software, applications and services.

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