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Thursday, June 1, 2023

EU Parliament Committee Votes Against Proof-of-Work Ban – Supports Alternative Amendment on Crypto Assets

EU Parliament Committee Votes Against Proof-of-Work Ban – The proposed Markets in Crypto Assets (MiCA) framework was voted on Monday by the Committee on Economic and Monetary Affairs (ECON). The bill includes a de facto ban on proof-of-work, which was added at the last minute.

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The committee voted against the proposed proof-of-work (POW) prohibition, according to Patrick Hansen, head of strategy at Unstoppable Finance. In a tweetstorm on Monday, he explained:

“The EU Parliament’s ECON committee recently voted against the de facto POW ban. The bitcoin and crypto communities in the EU may breathe a sigh of relief and celebrate a political victory.”

Also Read: FinCEN Issues ‘Red Flags’ on Potential Sanctions Evasion Using Cryptocurrency

According to him, 23 people voted in support of the POW prohibition amendment, 30 people voted against it, and 6 people abstained. Hansen confirmed that the final votes on the complete MiCA draft were 31 in favor, 4 against, and 23 abstentions.

“We are relieved that the Parliament voted against the ban of proof-of-work-based assets for EU enterprises,” Unstoppable Finance tweeted.

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Lawyer Jake Chervinsky said before the vote that MiCA’s POW prohibition seemed to be “a pretext for a bitcoin ban.” “Make no mistake: if they succeed in banning POW, they’ll move on to POS (proof-of-stake) and every other Sybil resistant mechanism after that,” he said.

Hansen went on to say that an alternate amendment proposed by Stefan Berger, a member of the European Parliament, gained support instead.

“By 1 January 2025, the Commission shall present 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 any crypto asset mining activities that contribute substantially to climate change mitigation and adaptation in the EU sustainable finance taxonomy,” according to the amendment.

Also Read: Europe’s MiCA Crypto Rules Submitted, ECON Committee to Vote in Mid-March

After the POW-ban votes, Berger tweeted that MiCA had won the first stage. He went on to say that by voting in favor of his plan, EU lawmakers had cleared the path for future crypto legislation.

In response to a question about whether the proof-of-work ban still had a chance, Hansen explained:

The groups that did not win the election have one final option. They might veto MiCA’s fast-track procedure through the trilogues and bring the debate to the Parliament’s plenary. They only need a 1/10th of the EP’s votes to accomplish so, which they already have.

“Even outside of this MiCA legislation, the debate over POW regulation is very far from over,” he said.

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