Why is the European Union trying to ban Bitcoin and Ethereum?

Welcome to the cryptohunt jam where we spend one minute a day to explain crypto. In plain english.

Today, let’s talk about a recently proposed law that would have made it illegal to use blockchains like Bitcoin and Ethereum in the European Union.

So! Why would anyone want to do that?

Because of big concerns about the environment. The EU has ambitious climate goals, and some blockchains consume excessive amounts of energy.

At the heart of the proposal was banning those chains that use “proof of work”, which is how some blockchains verify transactions.

This process is, in fact, MEANT to WASTE energy BY DESIGN. This is to deter bad actors from trying to overtake the network with fake requests, as every one of those would cost them restrictively high energy bills.

Of course, although cleverly conceived with good intentions by the inventor of Bitcoin, this turned out to be a catastrophic idea for the planet: Bitcoin alone consumes more energy than Norway.

And nowadays, there are alternatives that use massively better methods, all the way to carbon NEGATIVE blockchains.

But making Bitcoin, Ethereum, and others that use “proof of work” illegal would have cut millions of crypto investors in the EU out of their investments. And so the law was changed to not include this provision - at least for now.

What do you think? Should we have laws that force blockchains to become planet friendly?

Disclaimer: This podcast references our opinion and is for information purposes only. It is not intended to be investment advice. Do your own research and seek a duly licensed professional for investment advice.