Bitcoin saved from being deemed illegal in EUwritten by Bella Palmer
Monday's close call in the EU saw members of the EU parliament vote to reject a clause that would have crippled bitcoin mining within the bloc
Bitcoin has been saved from being deemed illegal in the European Union by 2025 by a close call vote.
Monday's close call in the EU saw members of the EU parliament vote to reject a clause that would have crippled bitcoin mining within the bloc.
The move has been seen as a clear signal that the EU wishes to support the development of the industry.
The decision by the EU to adopt an ‘innovation-friendly crypto-regulation’ will have far-reaching consequences for the sector and for Europe's place within it.
Patrick Hansen head of strategy at Unstoppable Defi tweeted: This is a big relief and political success for the bitcoin and crypto community in the EU.
Hansen added that if the bill had have gone through with the anti-proof of work amendment it would have killed the competitiveness of EU crypto businesses and would have driven capital and talent along with these companies out of the EU.
Renewable energy specialist Lorenzo Vallecchi said that the most relevant part of the proposal for investors is the possible inclusion of proof-of-work into the EU sustainable finance taxonomy at a future date.
He said that if this did happen then bitcoin mining would be among the officially classified green activities and would drive public EU money and guide large institutional investors towards it.
Immediately after the vote result was announced bitcoin bull and CEO of MicroStrategy tweeted that it reinforced support for bitcoin that is growing around the world.
But, it was a close shave as the anti-proof-of-work amendment to the Markets in Crypto Assets (MiCA) bill had a paragraph that insisted on the phasing out of the energy-intensive proof-of-work consensus mechanism.
Miners of bitcoin and ethereum use proof-of-work to validate transactions on the blockchain.
This clause took aim at the proof-of-work method due to environmental concerns because of the large amount of electrical power needed to run the required computer processors.
However, members of the European Parliament voted against this version of MiCA that would have effectively banned bitcoin mining within the bloc.
The EU Committee on Economic and Monetary Affairs (ECON) leader Stefan Berger said: By adopting the MiCA report, the European Parliament has paved the way for an innovation-friendly crypto-regulation that can set standards worldwide.
Berger said: The regulation being created is pioneering in terms of innovation, consumer protection, legal certainty and the establishment of reliable supervisory structures in the field of crypto-assets. Many countries around the world will now take a close look at MiCA.
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