The European Commission, the bloc's executive arm in charge of adopting new legislation, warned Tuesday that members of the European Union must be prepared to stop crypto mining. The EU is also working on an energy-efficiency badge for blockchains, as the disruption of Russian gas supplies has some worried about rising energy prices, blackouts, and shortages.
“In case, there is a need for load shedding in the electricity systems, the [EU] member states must also be ready to stop crypto-assets mining,” the commission said in a paper published Tuesday. Load shedding occurs when energy firms intentionally cut off supply to a certain group of users in order to prevent the entire system from collapsing.
“In the coming months and years, the Commission intends to take various steps to boost digital energy services while ensuring an energy-efficient ICT (information and communication technologies) sector, including … an energy-efficiency label for blockchains,” the commission noted.
In the long run, “it is also crucial to put an end to tax breaks and other fiscal measures benefitting crypto miners currently in force in certain member states,” according to the commission. Crypto's energy use has surged 900% in five years, reaching roughly 0.4% of global electricity consumption, according to the commission, who promises another research on the matter by 2025, which could recommend additional measures to reduce crypto's energy consumption. According to the report, Europe accounts for 10% of worldwide proof-of-work mining.
The energy use of proof-of-work technology, which channels computational power to mine new bitcoin, has piqued the interest of officials. EU politicians were on the verge of altering crypto legislation to enforce what some described as a bitcoin ban, while the White House in the United States has asked for new industry regulations.