The European Parliament will vote today on the latest draught of the Markets in Crypto Assets (MiCA) regulatory framework for digital assets. Heidi Chakos (@blockchainchick on Twitter) of the YouTube channel “Crypto Tips” discussed how this could affect investors in digital assets.
This is the aspect of the MiCA framework that has the crypto community concerned.
Before crypto assets can be sold, marketed, or exchanged in the Union, they must meet certain environmental norms. The consensus technique utilized to validate transactions will serve as the foundation for these standards.
In the past, they’ve attempted to pass a cryptocurrency-related statute or piece of legislation. They discussed banning proof of work, which is employed in many cryptocurrencies, a few weeks ago. Then they removed it, and now they’ve reintroduced it, but much more extensively.
So, I believe this is critical because they can no longer simply prohibit proof-of-work blockchains. These are the regulations that are being proposed in Europe if you use a cryptocurrency that does not survive long enough, is harmful to the environment, or is not as green as you believe it should be.
This means that Europeans who wish to launch a cryptocurrency in Europe will have to consider this. They warn that if a cryptocurrency does not fulfill its standards for sustainable practices, it will not be offered on EU-based exchanges.
“What does this imply for you as a user?”
If you have a Binance account, they will ensure that you go through KYC, and unless you have an ID proving that you are a European resident or citizen, you will be unable to purchase or sell Bitcoin or Ethereum.
That’s a lot of cash. It’s terrifying, and anyone who doesn’t know how to use a decentralized exchange will struggle. There are numerous ways to make money without using a bank. There is no longer a financial issue there.
“Also, returning to broad strokes, they aren’t saying specifically proof of work.” Some people may object to the fact that there are other sorts of cryptocurrencies that are not as environmentally friendly as they would want. Is this work evidence? Is this evidence of something else?
There’s a lot to say about Solana and how much computer power is required to perform all of those really rapid and low-cost transactions. It puts a lot of load on the computer’s power.
According to the Blockchain Association, if the EU bans crypto assets that utilize Proof-of-Work (PoW) consensus, they may also try to restrict crypto assets that employ Proof-of-Stake (PoS) consensus (PoS).