The vice chair of an influential markets watchdog in Europe has called for a ban on proof of work mining over concerns about how energy intensive it is.
Erik Thedéen, vice chair of the European Securities and Markets Authority (ESMA), said regulators in Europe should consider banning proof of work mining in favour of proof of stake, according to a report from the Financial Times.
Proof of work and proof of stake are the two methods by which crypto miners reach consensus — used to verify transactions and for creating new tokens. Proof of stake, the newer of the two models, relies on a smaller group of validators with skin in the game to process transactions.
Thedéen, who was appointed vice chair at ESMA in December, called bitcoin mining a “national issue” in his native country of Sweden.
“The solution is to ban proof of work,” he told the Financial Times. “Proof of stake has a significantly lower energy profile.”
Thedéen also serves as director general of Sweden’s Financial Services Authority and chair of sustainable finance at The International Organization of Securities Commissions, a global body of securities and futures regulators. His comments follow similar remarks made by the Swedish regulator in November of last year.
Crypto miners have come under mounting pressure over their energy consumption. Kosovo recently moved to outlaw crypto mining amid rolling blackouts enforced because of the country’s energy crisis. Tumult in Kazakhstan has also hindered bitcoin mining efforts.
The share price of some of the world’s biggest publicly traded crypto miners has halved since November.