replace the chairman of the European Securities and Markets Management (ESMA), Eric Teden demanded to ban on the EU mining based on the PROOF-OF-STAKE method, writes Financial Times. The regulator is concerned about the growing share of renewable energy in the energy consumption of mining.
PROF-OF-Work is a consensus algorithm that involves performing complex mathematical calculations to maintain the operation of the blockchain and performing transactions. It is these calculations that are engaged in powerful computers cryptocurrency. In Crypto Industry, it is this method of mining and called mining, for the rest of the mechanisms this term is not used.
Due to the harmony of the damage to the ecology, miners began to move to countries where cryptocurrency can be produced using renewable energy for the planet. Large volumes of such energy are manufactured in the Scandinavian countries, and they became the center of attraction for digital currency miners. Teden stated that Mining became a “national problem” for his homeland, Sweden, and called on immediate actions, since this type of activity would threaten the achievement by the European Union of the goals of the Paris Climate Agreement.
However, the deputy head of the regulator said that ESMA does not protrude for a complete ban cryptocurrency. According to Teden, the regulator considers reasonable to push the industry to a less energy-intensive method of mining cryptocurrency – proof-of-stake (or glass). This algorithm is distinguished by the fact that it does not require large computing capacity and energy volumes. In such networks, the operability of the blockchaws provide digital coins and receive remuneration for their storage. “The solution is to prohibit the proof-of-work. Proof-of-stake has a significantly lower energy profile,” summed up Teden.
The second largest cryptocurrency of Ethereum in 2021 declared plans to completely abandon the proof-of-work algorithm and go to Proof-of-Stake. According to developers’ plans, the network transformation will be completed in the third quarter of 2022. The founder of cryptocurrencies, Canadian of Russian origin Vitalik Biderin stated that changes in the network will produce to reduce the carbon trace Ethereum.