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Environmentalists and authorities have recently criticized Bitcoin (BTC) for its excessive energy use.
As the price of bitcoin has gone up, so has the electricity needed to run the bitcoin network. The process of securing the network, confirming transactions, and minting new coins is thought to use as much electricity each year as some small countries.
Even though an energy-saving upgrade to ethereum, the second-largest cryptocurrency, was put off until the end of this year, internal EU documents show how much anti-bitcoin talk there was among EU officials and their desire to "protect" things like ethereum.
Swedish financial regulators and the European Union's European Commission talked about putting a stop to bitcoin's proof-of-work (PoW) mining mechanism because it was bad for the environment, according to documents published by Netzpolitik in Germany and obtained under EU freedom-of-information laws.
Officials said the EU should stop trading bitcoin to cut down on the amount of energy it uses. They also said that the bitcoin community and developers should follow ethereum and switch to the less energy-consuming proof-of-stake (PoS) mechanism.
"If ethereum is able to move, we could legally ask bitcoin to do the same," the minutes of the meeting show. "We need to "protect" other crypto coins that are long-term. I don't think there's a need to "protect" the bitcoin community.
If you look at the University of Cambridge Bitcoin Electricity Consumption Index, you can see that the country of Finland uses about 139 terawatt-hours of electricity every year. That's more electricity than the country uses all at once!
A response to a question about a complete ban on bitcoin trading has been redacted from the minutes. This is to protect the "ongoing decision-making process," according to the text.
One official asked, "How would the disappearance of bitcoin affect consumers?" The official's answer: "Participants in bitcoin are fully aware of the volatility of the currency and the risk of investing."
However, some people say that trying to stop bitcoin mining or trading isn't going to cut down on bitcoin's energy use. An economist told Netzpolitik that "targeting the bitcoin price is the only thing likely" to cut down on bitcoin's carbon footprint. A policymaker would have to tax transactions or limit the trading of certain cryptocurrencies, says De Vries, who says this is what would happen.
People start to use more computers to work on the bitcoin network, making it more secure but also increasing the amount of electricity that the network needs to power and cool the special graphics processing units that work on the bitcoin network (GPU).
Fears have also been raised that the "fast-moving" crypto market could soon pose a threat to global financial stability.
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