In a first draft, the MiCA law aimed to ban cryptocurrencies with PoW.
According to an economist, stablecoins threaten the monetary sovereignty of states; Bitcoin No.
The Crypto Asset Markets Act, known as MiCA, aims to regulate the Bitcoin (BTC) and cryptocurrency markets in Europe. It will come into force at the end of 2024.
This law has been the subject of various debates as it requires transaction tracking by governments and regulators for all users using exchanges or buying and selling platforms. This was discussed on the first day of the “Watch Out, Bitcoin!” conferences. “23,” held in Madrid, Spain.
The lawyers Alfredo Muñoz, Cristina Carrascosa, Juan Ignacio Ibañez, Javier Maestre and the economist José Antonio Bravo, led by Alberto Mera, They debated how necessary the MiCA law is and what government control it would entail..
For Muñoz, the state must always act as a legislator where necessary; He even mentioned that the goal of MiCA is to “protect asset holders,” citing as an example that “If Binance goes bankrupt, account holders could claim their cryptocurrencies«. Muñoz also mentioned that MiCA is not strictly a control legislation, but the law itself does not regulate the ownership of self-custody wallets.
On these opinions Cristina Carrascosa He expressed that he does not understand why the state requires certain personal information from citizens. He explained that through the MiCA law, governments will track and identify which cryptocurrency address belongs to each citizen when using exchanges. According to Carrascosa, the state should only establish a tax policy together with a legal framework, seek compliance with it and impose the necessary sanctions, but not establish constant tracking and monitoring for compliance. According to Carrascosa Accepting that Bitcoin transactions are monitored “means accepting complete surveillance by the state”.
The MiCA law and monetary sovereignty
Although Muñoz explained that the aim of the MiCA law is consumer protection, several speakers agreed that it is also about protecting monetary sovereignty within the Eurozone and the “danger” that Bitcoin could pose to regulators.
Muñoz noted that the regulation does not force people to stop using Bitcoin; Even using Bitcoin “can drive lawmakers into a corner,” since then People can live in circular economies and not use government-issued currencies.
Regarding the latter, Javier Maestre Rodríguez said that in his opinion MiCA regulation and protection of monetary sovereignty was created against Bitcoin because “Bitcoin is the only one that can threaten monetary sovereignty.” However, economist José Antonio Bravo disagreed, commenting: “Stablecoins are the ones that threaten monetary sovereignty; Not Bitcoin«.
Juan Ignacio Ibañez assured that Tether (USDT) has great freedom of action in some countries, which has become a problem for states since, in his opinion, this type of large stablecoin requires much more constant monitoring than any other type of cryptocurrency.
Carrascosa also commented on this issue. According to them, if Bitcoin poses a threat to monetary sovereignty, regulators would act immediately to prevent it. Because, according to the lawyer: “Tax money is the most powerful control instrument that governments have over their citizens.”
PoW almost led to a Bitcoin ban in Europe
Proof of work or Proof of work (PoW) is the consensus algorithm that enables the confirmation of transactions within a cryptocurrency network such as Bitcoin, as defined in the CriptoNoticias Cryptopedia. Its benefit requires a large use of computing power by miners, who have high energy consumption.
Lawyer Carrascosa, who took part in the official debates on the MiCA law, explains that an initial draft of the law stipulated that, in the pursuit of environmental sustainability, no cryptocurrency operating under PoW could be used within the Eurozone. This draft was corrected in later versions and eventually removed.
Muñoz explained that in this context, this first draft prohibits not only Bitcoin mining, which ultimately causes high energy consumption, but also the general use of Bitcoin. The economist Jose Antonio Bravo He said that the study that led to this conclusion was completely wrong and based on many lies.
It is worth noting that we at CriptoNoticias have reported how Bitcoin mining has become increasingly green and sustainable while maintaining profitability. A study published by the University of Cambridge showed that Bitcoin mining is now eight times more ecological than it was eight years ago.
Therefore, it is important to highlight that, as Muñoz even commented, many of the claims used to create the MiCA law were used They were carried out out of ignorance about Bitcoin or even personal interestswhich did not serve the benefit of the common citizen.