back to article Europe advances crypto-coin regulation – without potential ban on Bitcoin

Europe's lawmakers this week moved ahead with their proposed cryptocurrency regulations, having ditched a rule that might have banned financial services from dealing in Bitcoin and Ethereum. The European Union is considering ways to regulate digital coins, particularly to stamp out money laundering, and as such in 2020 drew up …

  1. Potemkine! Silver badge

    Bad move. Banning Crypto would have been a bold move, but I'm not surprised politicians didn't do it. Promising them a way to get money with minimum traces is too appealing to them.

    1. Anonymous Coward
      Anonymous Coward

      "Ban Cryptp"

      You'd have to ban trading cards, investing in wine, or any other area of business which takes fiat currency and turns it into something else.

      1. Ian Johnston Silver badge

        Re: "Ban Cryptp"

        Guidelines for Living #237b: Anyone who uses the term "fiat currency" can be safely ignored.

        1. Anonymous Coward
          Anonymous Coward

          Re: "Ban Crypto"

          Anyone who uses the term "fiat currency" can be safely ignored.

          Why ? Just because you don't understand it, doesn't mean it's not a valid term in discussions of economics and business.

          1. Seajay#

            Re: "Ban Crypto"

            It was a useful term in the 70s when there were a mix of fiat currencies and those backed by gold and a debate over which was a better approach.

            But it's not a useful term now when there are no major currencies backed by physical commodities. Now all currencies are fiat (crypto currency included). So using the phrase 'fiat currency' adds no extra value over saying 'currency'.

            Therefore, using it suggests you are trying to make yourself sound fancy, while simultaneously not really knowing what you are talking about.

            People sometimes imagine that crypto is in some way backed by computing power or electricity. But that's not the case. You can create crypto from electricity, but you can't convert it back the other way.

      2. werdsmith Silver badge

        Re: "Ban Cryptp"

        Bazooka Joe comics.

  2. Androgynous Cupboard Silver badge

    A missed opportunity

    It is like trying to ban the internet because it takes up 70 percent of phone line bandwidth.

    The latest in an infinitely long line of analogies crafted to deliberately miss the point. I've come to the conclusion that Cryptocurrency fans are not trying to fool us, they've fooled themselves. Better than acknowledging that a system designed to require ever increasing amounts of energy just to stay afloat is unsustainable and unethical.

    Proof Of Work systems do not expect to become more efficient over time. Any gain in efficiency must be countered with an increase in workload, or the whole thing collapses. It's a perversion of market economics.

    1. tony72

      Re: A missed opportunity

      You crypto haters will keep peddling this nonsense, won't you? The reality is that the energy used by bitcoin mining is insignificant in the big picture, compared in an apples-to-apples way, bitcoin is more energy-efficient than equivalents, the majority of bitcoin is already mined using renewable energy, and bitcoin is actually helping to drive renewable energy adoption by monetizing excess green energy in places where it wouldn't otherwise be economically viable.

      1. aidanstevens

        Re: A missed opportunity

        This is complete and utter nonsense, you've turned the truth on its head in your desperate attempt to justify this awful trend.

      2. Filippo Silver badge

        Re: A missed opportunity

        "compared in an apples-to-apples way, bitcoin is more energy-efficient than equivalents"

        If you mean compared to other PoW systems, that may well be true: they are all awful, some are more awful than others. Ban them all.

        If you mean compared to e.g. a credit card or cash, I cannot fathom what goes on in a mind that could claim something like that. Traditional financial transactions are not only more energetically efficient than PoW systems; they are more efficient by several orders of magnitude. You can literally run a typical shop's yearly transactions with the same energy it takes to make a single bitcoin transaction.

        1. tony72

          Re: A missed opportunity

          This argument is typically based directly or indirectly on numbers from a 2018 article published in Nature's Climate Change Journal. That article made several errors, including conflating the energy used to produce an entire bitcoin block with the energy used for a single transaction. Since a bitcoin block actually stores thousands of transaction, their numbers are several orders of magnitude too high. This is well-known, but of course that doesn't stop crypto haters from continuing to spew misinformation based on that article.

      3. Seajay#

        Re: A missed opportunity

        "bitcoin is actually helping to drive renewable energy adoption"

        This entirely misses the purpose of renewable energy. Renewable energy is not good for the environment, it's bad, it still requires resources to make.

        It's only good if it displaces fossil fuel energy, which is much worse.

        Using entirely renewable energy to make bitcoin is bad because it still has a negative environmental effect and more importantly because it uses energy which could otherwise have been used to displace fossil fuel usage elsewhere.

        The whole argument is a bit like you claiming that firing a pistol in to the air is good for safety because it monetises helmet production in areas where it wouldn't otherwise be economically viable.

      4. Anonymous Coward
        Anonymous Coward

        Re: A missed opportunity

        >The reality is that the energy used by bitcoin mining is insignificant in the big picture

        https://ccaf.io/cbeci/index

        Pretty similar to a space shuttle launch @ 12GW - or almost exactly 100 CERNs if you look at the annual figure. Not sure that the official unit of energy is on the Reg.

        >bitcoin is more energy-efficient than equivalents

        Like proof of space based cryptos for instance? No, it's just been a waste fueled by greed, even though it will eventually settle to much lower cost - all that abstract work was fruitless, could have been chasing primes, ET or any number of useful things.

    2. Filippo Silver badge

      Re: A missed opportunity

      My thoughts exactly. I dislike cryptocurrencies because they seem to be largely used for criminal activities, but I wouldn't ban them on that basis. For decades, we've allowed all kinds of technology that had been largely used for copyright infringement, and that was fine. I'd be okay with banning PoW cryptocurrencies specifically, while leaving other systems alone.

      However, PoW systems are just fundamentally flawed. Ian Taylor's analogy doesn't make sense, exactly for the reason you describe: PoW systems are specifically designed to consume resources. If the Internet was explicitly designed to consume excessive bandwidth as its primary goal (rather than as a side effect of inefficient encodings and too many cat videos), damn straight we'd ban it.

      1. Androgynous Cupboard Silver badge

        Re: A missed opportunity

        > PoW systems are specifically designed to consume resources.

        A much more succinct summation, thanks. I'll be using that the next time I'm asked to explain this as "I have something to do with computers".

  3. Anonymous Coward
    Anonymous Coward

    Ethereum moving away from PoW looking like a good idea.

    I am crypto fan and holder but PoW is impossible to defend from an environmental point of view. Once Ethereum moves to PoS this year this will hopefully be a big step forward.

  4. Anonymous Coward
    Anonymous Coward

    just ban this conmans dream shit

    it only enables criminal activity, ban the fucking lot, it's just wasting power and storage

    1. Nafesy
      Holmes

      Re: just ban this conmans dream shit

      I think you'll find that the majority of crime involves traditional currencies. Should we ban those? No.

      I get the energy wastage argument against PoW blockchains, but your stated view here is very outdated. (In fact, blockchain generally improves transparency)

      For example, the Swiss government has developed an app ( https://profila.com ) to allow users to maintain ownership of their personal data on the Cardano blockchain (not a proof of work network - https://cardano.org/).

    2. Macs1000

      Re: just ban this conmans dream shit

      Having just read the article on LokiLocker ransomware I wonder just how many ransomeware gangs demand payment in hard cash?

  5. Pascal Monett Silver badge
    FAIL

    It is absolutely not

    "It is like trying to ban the internet because it takes up 70 percent of phone line bandwidth."

    The phone line takes a ridiculously small amount of energy compared to the amount of data being transferred. This is a strawman argument without any basis in reality, but I expect no less from someone purporting to defend the best method criminals have to whitewash their ill-gotten gains.

    Banning crypto would put paid to many, many pyramid schemes and other scammer attemps to make an easy buck. I'm not saying crypto is only used by criminals, but when criminals have massively adopted something and use it so successfully, there might be a good reason to put a serious crimp on it.

    1. tony72

      Re: It is absolutely not

      Banning crypto would put paid to many, many pyramid schemes and other scammer attemps to make an easy buck. I'm not saying crypto is only used by criminals, but when criminals have massively adopted something and use it so successfully, there might be a good reason to put a serious crimp on it.

      Scams and crime are everywhere, but the there is no evidence that the proportion of crypto activity involving crime is higher than in non-crypto; in fact, it's probably lower.

      1. Potemkine! Silver badge

        Re: It is absolutely not

        in fact, it's probably lower.

        First, it's an estimation and next, remove all transactions who are purely speculative and the percentage will go much higher.

        Cryptocurrencies are made to speculate, for criminal activities, are a waste of energy and participate to the threat against the whole humanity. The sooner they will be ban the better.

      2. Androgynous Cupboard Silver badge

        Re: It is absolutely not

        That's a piss poor article in Forbes.

        The conclusion "probably lower" is based on a comparison of wallets known to be associated with illegal activity (which Chainanalysis put at 0.34% of transaction volume in 2020) vs. an estimate of the total proportion of global GDP "associated with money laundering and illicit activity" (which the UN put at 2-5%)

        First, the bar for "known illegal" is much higher than an estimate. The comparison is what proportion of the non-crypto financial market is to "known illegal" recipients. Given that participants in those transactions (ie. the bank) can be prosecuted, I would expect it to be orders of magnitude lower. Know Your Customer regulations are poorly enforced, but they do exist.

        Second, they're comparing "illegal activity" with "illegal activity and money laundering": money laundering surely makes the bulk of that category. I have paid a builder in cash; I have not extorted money with ransomware. I look forward to the discussion on the volume of Cryptocurrency transactions "estimated to be associated" with money laundering - I'll wager some of my post-tax earnings it's higher than 2%.

        It's statistical illiteracy dressed up as research, so it should come as no surprise the author is someone in the Cryptocurrency industry.

        Edit: note the original paper says the 0.34% estimate is expected to rise over time. Their estimate from 2019 doubled as more "known illegals" were identified.

      3. Anonymous Coward
        FAIL

        Re: It is absolutely not

        @ tony72

        The key word you used on your link is “probably”. It is usually a shorter way of spelling “I/We don”t know”.

  6. HildyJ Silver badge
    Facepalm

    Ban arguments about crypto

    They just waste the time and increase the stress of ElReg commenters and I cannot recall anyone on either side ever being convinced to change their mind.

    1. Anonymous Coward
      Anonymous Coward

      Re: Ban arguments about crypto

      There was an ongoing argument on the W3C advisory committee mailing list on this very topic that lasted about 2 months. It may still be ongoing in fact, and everyone is just pausing to regroup.

      Some extremely seasoned and highly respected engineers on both sides, but ultimately the same arguments: "crypto is exciting and destabilising, it lets us build a world without trust or regulation, and do things we can't do any other way, and if you look at it from exactly this angle, it's got no faults" vs "it's 10% new, we can already do all that ot promises, we need regulation and trust and you are refusing to acknowledge the environmental cost"

      I'm not sure it convinced me to change my mind, but it did swing me from "mildly negative" to "immensely negative".

  7. cornetman Silver badge

    Not entirely sure how you would "ban" cryptocurrencies. It's just networks + computation. They could certainly do something about exchange mind.

  8. MrGreen

    DYOR

    If energy usage is so important why aren’t there calls to ban tumble dryers and Christmas lights?

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