What was previously known from washing machines, televisions or refrigerators should soon also be introduced for cryptocurrencies, at least if the EU Commission has its way. BTC-ECHO has a verified internal draft in which the executive body wants to introduce an efficiency class system for Bitcoin and Co. by 2025. The classification is intended to check the underlying blockchain for its sustainability. The Commission still wants to define corresponding minimum standards for energy consumption.
An additional report will also assess the “climate impact of new technologies” in the crypto market. It would also discuss “political options” to weaken environmentally harmful crypto-technologies, especially in relation to the consensus mechanism.
It is currently not known which options this could be. However, a look at the USA provides information about possible steps. The White House in September called on the domestic crypto industry to cut its greenhouse gas emissions by 50 to 52 percent by 2030. Failure to comply was openly threatened with a Proof-of-Work (PoW) ban. A similar step is at least not completely ruled out in the EU.
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However, it is more likely that green funds and other sustainable financial products will not be able to include PoW cryptocurrencies like Bitcoin in their portfolio, an insider tells BTC-ECHO.
The basis for the project is the recently finalized EU Crypto Regulation (MiCA). This obliges providers to disclose the energy consumption and the impact of assets on the environment. With the efficiency class system, however, the Commission is going one step further.
EU member states to reduce energy consumption of crypto miners
Aside from the blockchain label, due to the energy crisis, the EU Commission is calling on the member states to take measures to reduce the electricity consumption of crypto miners. According to the EU, 10 percent of digital mining activities currently originate in Europe. However, there is no source reference.
“Promote Green Consensus Mechanisms”
At the same time, the EU Commission praises the recent merger of the second largest cryptocurrency, Ethereum. Since switching to Proof of Stake, energy consumption has been reduced by 99 percent. The process has shown that “the crypto world can become more energy efficient,” say Brussels. In the future they want to promote “environmentally friendly consensus mechanisms”. They should prevail as the new “gold standard”, it is said. Specifically, this should be done via the company’s own blockchain infrastructure.
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