Cryptos Significant Impact on Environment | European Union

European Union Seeks More Data on Crypto’s ‘Significant’ Environmental Harm
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The bloc’s executive arm is spending $842K on a study as it mulls what to do about energy-hungry proof-of-work technology.
The European Commission issued an 800,000 euro ($842,000) contract on Tuesday as it seeks to mitigate what it calls “significant harm” of crypto on the environment.
The study, for which bids close on Nov. 10, will develop standards that feed into potential future European Union policies to curb the impact of crypto on climate change and to new energy efficiency labels for blockchains.
“There is evidence that crypto-assets can cause significant harm on the climate and environment,” potentially undermining the bloc’s goal to cut greenhouse gas emissions, the European Commission said in tender documents, which suggest that new sustainability standards may be taken up in future laws.
European Union lawmakers worry about the energy-intensive proof of work consensus mechanism that underpins blockchains such as Bitcoin.
During negotiations last year on the bloc’s Markets in Crypto Assets regulation, they came close to approving green controls that some characterized as a bitcoin ban. Though the final text doesn’t go that far, MiCA does require issuers to declare environmental impacts using a method that still has to be nailed down.
The European Union study, to be produced over the course of a year, will look at green issues like crypto’s use of water, waste products, and natural resources as well as energy, the commission said.
Crypto's energy use has also come in the crosshairs of the U.S. government. A 2022 report from the White House found that significant crypto assets are responsible for 0.3% of global greenhouse gas emissions, though crypto proponents have also argued mining could help decarbonize energy grids.

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