Russia’s invasion of Ukraine worsened an existing energy crisis, pummeling the EU and U.S. economies and setting off a scramble for new sources of energy that put a spotlight on energy-intensive practices.
The huge energy demands of cryptocurrencies like Bitcoin — which have seen some “miners” fill warehouses with specialized computers to solve complex equations and complete transactions on the blockchain — are at odds with the prevailing mood, and are increasingly in the crosshairs of regulators on both sides of the Atlantic.
“As a regulator, we will take sustainability and ESG [environmental, social and governance] factors increasingly into account in all of our work that we do,” the chair of the European Securities and Markets Authority, Verena Ross, told POLITICO when asked how far the regulator will go to green the crypto industry.
To achieve this, ESMA will focus on promoting industry transparency, understanding the signs of greenwashing and identifying emerging trends and risks within the market. “All three focus points speak in a way on what might come specifically under the crypto space,” added Ross.
That said, not everyone is on board with the coercive approach.
Industry lobbyists aside, officials inside the Commission and even among the Greens in European Parliament are not convinced energy grades will bring about the sort of change officials hope it will. Only around 10 percent of the world’s crypto-mining activity is based in the EU, they point out.
