ECB official proposes ban on tokens with an 'excessive ecological footprint'
Fabio Panetta, an executive board member of the European Central Bank (ECB), proposed banning crypto assets with a significant environmental impact as part of efforts to address risks.
In written remarks for the Insight Summit at the London Business School on Dec. 7, Panetta said harmonizing taxation around crypto between global jurisdictions could address some of the energy and environment costs around mining and validation. He added that tokens “deemed to have an excessive ecological footprint should also be banned,” referring to proof-of-work assets in a citation.
Panetta added crypto markets were often at risk due to their “incredibly high leverage and interconnections,” citing the collapse of the FTX exchange:
Crypto-assets have become the bubble of a generation, says Executive Board member Fabio Panetta at the @LBS's Insight Summit 2022. Crypto-assets are not money. Many are just a new way of gambling https://t.co/S3YOJcq9QM1/4 pic.twitter.com/2VmYAtWGja
The ECB official’s calls for additional regulatory oversight in a ‘Wild West’ crypto market followed the European Parliament Committee on Economic and Monetary Affairs approving the Markets in Crypto Assets bill, or MiCA, in October after extensive discussions. The crypto framework awaits final approval following legal and linguistic checks by EU lawmakers, with many expecting the policy to go into effect starting in 2024.
Related: How blockchain technology is used to save the environment
Associating cryptocurrency transactions and mining operations with environmental concerns has often been a rallying point for global policymakers. In the United States, the New York state legislature voted in favor of a two-year moratorium on crypto miners that use energy generated by
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