The European Commission has allocated a budget of 800,000 euros for a comprehensive study aimed at understanding and reducing the environmental impacts of cryptocurrencies.
EU Launches Study to Assess Environmental Impacts of Cryptocurrencies
This initiative reflects the EU's determination to address what it perceives as the significant environmental damage caused by the cryptocurrency industry.
The study, which is open for proposals until November 10, aims to establish benchmarks that could potentially inform future EU policies designed to tackle the environmental footprint of cryptocurrencies.
The work will also contribute to the development of new energy efficiency labels specific to blockchain technology.
According to tender documents published by the European Commission, there is compelling evidence to show that crypto assets have the potential to put significant pressure on the climate and the environment.
This concern stems from the fear that this environmental impact could hinder the EU's ambitious targets to reduce greenhouse gas emissions.
As a result, the EU is considering the adoption of sustainability standards in future legislation.
One focus of EU lawmakers' concerns is the energy-intensive proof-of-work consensus mechanism underlying blockchains such as Bitcoin.
During discussions on CryptoAsset Markets (MiCA) regulation last year, proposals were made that some saw as tantamount to banning Bitcoin due to its environmental impacts.
Although the final text did not go this far, MiCA requires issuers to disclose their environmental footprint.
*This is not investment advice.