Sweden’s financial and environmental regulators have called on the European Union to pull the plug on proof-of-work bitcoin mining due to the negative impact on the environment, according to multiple reports.
Erik Thedéen, director general of the Financial Services Authority of Sweden, and Bjorn Risinger, director general of the Swedish Environmental Protection Agency, are both worried that crypto mining will cause the country to be unable to meet climate obligations.
Crypto mining in Sweden escalated between April and August, and the electricity used could run 200,000 regular households. Following the crackdown on crypto mining in China, miners migrated to other regions.
The Swedish regulatory heads have asked the EU to consider a blanket ban on proof-of-work mining since other methods are said to reduce energy consumption by over 99%. The directors also want Sweden to stop allowing new locations that use energy-intensive coin minting methods.
Thedéen and Risinger have said there are ways to discourage mining, such as taxes and education.
“For instance, Sweden and other countries could introduce a tax on the energy-intensive production of bitcoin. Another option is to communicate more widely around the climate problems related to crypto-assets, in the hope that this will lead to both producers and investors demanding a shift to mining methods that require less energy,” they said.
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The directors want Sweden to end new crypto mining operations and to stop any companies involved in the trading or investing of crypto assets from claiming environmental sustainability.
“The emissions need to stop here and now, and renewable energy needs to be used for the climate transition of essential services,” they said.
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While Sweden is calling for an end to mining, some areas, like the state of Texas, are welcoming them. Melanion Capital, known for its Bitcoin ETF, said the Swedish agencies’ call to ban proof-of-work mining across Europe is “completely misinformed.”