BTC, ETH Swing as EU Vote Down Crypto Bill
Digital assets swing negative as the European Union parliament today voted down the crypto market bill. Most of the top 20 digital assets were trading lower as of Monday late afternoon.
Bitcoin (BTC-USD), the largest cryptocurrency by market value, was down 1% in the past 24 hours at $38,544, according to data from trading data. Trading volume was at $22.58 billion, up 54%, CoinMarketCap data show.
Ethereum (ETH-USD), the second-largest digital asset, fell 2.4% to $2,517, whereas XRP (XRP-USD), dropped 4.4% to $0.76, data from coinmarketcap shows.
Fourteen additional digital assets in the CoinDesk 20 list, which represents 99% of the market by volume at eight of the largest exchanges, posted losses.
Avalanche (AVAX-USD), the eighth-largest digital asset, saw the biggest move, falling more than 6%. Terra (LUNA-USD), the fifth-largest digital asset, was the only gainer, trading 0.4% higher at $90.21.
Tether (USDT-USD) and USD Coin (USDC-USD), two stablecoins pegged to the US dollar, were trading up 0.03% and 0.05% from their value 24 hours ago. BTC dominance also reduce as market capitalisation tumbled.
Today, the European Parliament voted down a set of bills targeted to launch regulations in the cryptocurrency market, in particular, the contentious clauses regarding proof-of-work (PoW) cryptocurrency mining restrictions.
The vote was close, with 32 against and 24 in favour.
Analysts said blockchains based on a PoW consensus algorithm such as Bitcoin will continue to be mined and traded in the Eurozone without any specific regulations in place.
However, it is not impossible for this to change over time given the current geopolitical crisis that the EU is embroiled in amid the Russia-Ukraine war.
The ECON (Economic and Monetary Affairs) committee of the European Parliament voted down amendments to the Markets in Digital Assets (MiCA) bill, which contained regulatory frameworks for targeting PoW networks due to environmental concerns.
“If the proposal pushed through, all crypto mining operations for blockchains that require proof-of-work consensus algorithms would effectively be banned”.
The MiCA vote has already been delayed beforehand because of similar provisions that detail how proof-of-work mining should be ceased because of their environmental impact and environmental sustainability standards which are aimed at reducing carbon footprint.
With 27 member states in the European Union, such a proposal will have a widespread impact not only on European crypto consumers but also on users worldwide who may be using crypto apps and platforms based in the region.
The proposal itself says that all cryptocurrencies used and mined in the EU’s member states would be required to adhere to “minimum environmental sustainability standards” as well as be urged to “set up and maintain a phased rollout plan to ensure compliance.”
Concerns over the energy-intensive requirements of proof-of-work based blockchains such as Bitcoin have led to the proposal’s drafting and filing.
As a result of the vote, Bitcoin and similar cryptocurrencies will likely be added to the EU taxonomy for sustainable activities effectively making mining operations and capital acquisition for crypto firms more viable in the long term. #BTC, ETH Swing as EU Vote Down Crypto Bill