Why European MiCA Regulatory Legislation Shouldn't Ban PoW Cryptocurrencies?

Original author: Jean-Marie Mignetti

Original compilation: 0x9F, Rhythm BlockBeats

Jean-Marie Mignetti, CEO of CoinShares, a well-known European encrypted asset management company, published on his personal social media platform his opinion that the European Parliament will supervise its MiCA tonight Regarding the viewpoints of relevant legislation, Rhythm BlockBeats has compiled and translated the full text as follows:

The European Union's Encrypted Assets Market (MiCA) Act contains provisions restricting PoW. future. (Credit to the CoinShares research team for the following research findings.)

ESG (Environmental, Social and Governance) is the key word, where environment is paramount. Relevant documents are not only scarce, but also do not know the truth. Therefore, CoinShares developed a comprehensive model to estimate carbon emissions and created our own data collection framework. The results are published in one of our latest Bitcoin Mining Reportmiddle.

The annual energy consumption of Bitcoin mining is 89 TWh (estimated based on data in December 2021), accounting for about 0.05 of the total global energy consumption % (total global energy consumption in 2019 was approximately 162,194 TWh).

The annual carbon dioxide emissions of global bitcoin mining are 41 million tons, compared with the aviation industry, ocean transportation industry, air conditioners, electric fans, data centers and tumble dryers, the carbon dioxide The footprint is much smaller.

In the U.S. alone, miners have the potential to reduce their natural gas flaring and emissions carbon footprint by as much as 78 million tons of CO2e. This is enough to completely offset all emissions and even have a positive net emissions impact.

We expect this trend to continue as ASIC chip performance continues to increase significantly and hardware devices continue to be updated and iterated.

Furthermore, the vast majority of carbon emissions from mining may be generated in non-Western countries.

Currently the most carbon-intensive are Kazakhstan, Montana, Kentucky, and Alberta, where much of the electricity is produced using petroleum and carbon-intensive fossil fuels such as coal. These four regions generated 43% of the emissions but only 26% of the computing power.

Conversely, regions such as Norway, Iceland, Sweden, the Canadian provinces of Quebec and Canadian provinces of Manitoba currently produce hardly any emissions, but generate about 5.2% of computing power.

What these low-emission regions have in common is that they are rich in hydropower resources and relatively large distances between large power plants and major power consumption centers.

Since renewable energy tends to have a much higher penetration rate in their generation mix, if Western countries are genuinely interested in reducing the carbon impact of Bitcoin mining, They should do their best to incentivize miners to establish operations in their jurisdictions, especially in Western Europe.

The worst thing western countries can do to limit the carbon emissions of bitcoin mining is to force miners out of their jurisdictions. Such a move would have the exact opposite effect, driving miners further into regions where fossil fuels are heavily subsidized, thereby increasing carbon emissions.

Although the vast majority of energy is used to mint new coins, the minting is programmed to decay geometrically to zero in the next 100 years or so . By the 1940s, more than 99% of bitcoins would have been minted.

Once the minting activity is actually over, most of the energy demand will come directly from the market demand for bitcoin transaction settlement in the form of consumers paying miners transaction fees .

At 0.08% of global CO2 emissions, removing mining networks from global demand (thus depriving hundreds of millions of people of fair and accessible The only hope for currency) has an almost negligible impact on the environment.

Although Bitcoin mining currently produces some carbon emissions, these emissions are not only insignificant on a global scale, but can also be reduced by using renewable energy to zero.

Once our electricity is 100% clean energy, Bitcoin will also be 100% clean energy. Our focus should be on building renewable energy generation, not on stifling crypto development.

At the end, I would like to quote Satoshi Nakamoto: "The utility of Bitcoin transactions will far exceed the cost of electricity used. Therefore, no Bitcoin will be a A net waste."

Satoshi Nakamoto was right that the benefits of Bitcoin and other cryptocurrencies far outweigh the carbon emissions they generate.

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