ESMA Vice President urges EU to ban PoW mining model if “Bitcoin has become a national issue”
The Vice President of the European Securities and Markets Authority (ESMA) – Erik Thedéen – has called on EU financial regulators to ban the Proof-of-Work (PoW) crypto mining model. He also explained that Bitcoin has become a “national matter” for Sweden because renewable energy is dedicated to mining this asset.
Erik Thedéen – Vice-President of ESMA
“The solution is to ban PoW mining”
In a recent interview for the Financial Times, Erik Thedéen (also General Manager of FCA of Sweden) pointed out that cryptocurrencies using PoW mining pose a significant risk to the environment. Therefore, European regulators should encourage a Proof-of-Stake (PoS) model that is less energy intensive:
“We need to discuss switching the industry to more efficient technologies. The solution is to ban PoW. PoS has a significantly lower performance profile.”
It is worth noting that the two largest digital assets by market cap – Bitcoin and Ether – currently both rely on PoW mining technology. However, Ethereum is in the process of upgrading its network to Ethereum 2.0, which is expected this summer. Upon completion, the second major blockchain protocol will use the PoS approach and thus focus more on the green environment.
However, Bitcoin has no plans to change its mining model. Thedéen said the largest digital asset is now a “national matter” for Sweden, as a significant portion of renewable energy is being focused on mining. He suggested that Sweden’s electricity should be used to create traditional services, not BTC:
“It would be ironic if wind energy generated along Sweden’s long coastline was spent on bitcoin mining.”
The bright side of BTC mining
In October last year, the authorities of the Canadian city of North Vancouver decided to use the energy released during Bitcoin mining to heat residential and commercial buildings. The initiative will be implemented in the first half of 2022 with support from the joint efforts of Lonsdale Energy Corporation (LEC) and local digital asset miner MintGreen.
The company then claims that its “Digital Boiler” can prevent 20,000 tons of greenhouse gases per MW from being released into the atmosphere compared to natural gas.
Karsten Veng, CEO of Lonsdale Energy Group, in turn hopes that the Canadian city of almost 50,000 people and the environment will benefit from the partnership:
“LEC is on a journey to reduce greenhouse gas emissions and this project will be part of that.”
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