EU parliament scraps plan to ban proof-of-work

Key Takeaways

• Bill not aimed at banning cryptocurrencies, says EU legislator.
• ECON committee still needs to vote on revised MiCA bill.

LAGOS (CoinChapter.com) — European Union legislators have scrapped a controversial aspect of its proposed bill to ban proof-of-work tokens.

The Markets in Crypto Assets (MiCA) Bill, which had a section that could have made it illegal for users based in the U.K. to deal in tokens that use proof-of-work, generated a major outcry from the crypto industry.

Stefan Berger, the EU legislator who spearheaded the proposed bill on Monday, confirmed that the controversial section had been removed.

The proposed bill is mainly focused on creating general rules for crypto-asset service providers and issuers at the EU level. MiCA was meant to serve as a regulatory framework for crypto across the EU.

However, an aspect specified that by 2025, cryptocurrencies that use proof-of-work mechanisms could no longer be created or traded within the EU didn’t sit well with the crypto community. The legislators perceived the move as a ban on Bitcoin and Ethereum mining in Europe.

The outcry led to the pause and eventual removal of the controversial provision. Berger, however, argued that the lawmakers’ intention was not to ban cryptocurrencies but ensure it was environmentally conscious.

ECON Committee Still Need To Vote On The Revised Bill

The EU lawmaker further noted that talks would resume following the removal of the controversial section. However, due to the backlash, the lawmakers had indefinitely postponed their earlier February 28 vote.

Berger noted that the European Parliament’s Committee on Economic and Monetary Affairs will still need to vote on the provision. According to reports, the voting will take place in two to four weeks (March 14 or early April).

If it passes those votes, the bill will face immense debates before it is eventually enacted. The EU has not set a new date to vote on the proposed MiCA bill at the time of publication.

Crypto Community Express Delight With Bill Revision

The crypto community has also expressed its delight in revising the proposed bill. Although the bill is focused on curbing crypto high energy usage, many users argue that Bitcoin and other cryptocurrencies are cutting down on their emissions.

Su Zhu, co-founder and CEO/CIO of Three Arrows Capital, applauded the revision of the bill via his Twitter handle. He praised the people who ensured that the bill’s section targetting proof-of-work was scrapped.

Another Twitter user Paker Lewis reiterated the importance of proof-of-work and how it would continue to be influential.

He said, “Proof-of-work forever displaces social credit scores and everyone can thank #bitcoin later.”