In a proactive move, the Cardano Foundation, in collaboration with the Crypto Carbon Rating Institute (CCRI), has published sustainability metrics for the Cardano network. This ensures compliance with the upcoming MiCA regulations in the EU. This initiative highlights Cardano’s energy-efficient consensus protocol and underlines its commitment to a sustainable and transparent approach to cryptocurrency.
Indicators ahead of MiCA regulations
The report published by the Cardano Foundation and CCRI reveals that the crypto network runs on a consensus protocol. The latter consumes significantly less electricity than Proof of Work (PoW) protocols. As of May 2024, the total annual electricity consumption of the network was 704.91 MWh. A figure much lower than that of PoW-based networks like Bitcoin.
Cardano’s sustainability indicators are compliant with the Regulatory Technical Standards (RTS) proposed by ESMA under the MiCA framework. These indicators cover energy use and greenhouse gas emissions. But also waste production and the use of natural resources.
Implications for the crypto industry
The Cardano Foundation has taken the lead in complying with the MiCA sustainability indicators six months ahead of the regulatory deadline. It thus establishes a new standard for the industry of crypto in the European Union. Frederik Gregaard, CEO of the Cardano Foundation, expressed that this initiative aims to ensure adherence to upcoming EU regulations and set a benchmark for the crypto industry.
Cardano’s initiative is a demonstration of how blockchain networks can address ESG concerns! Particularly environmental impact, while maintaining transparency and efficiency. With the MiCA regulations coming into effect in December, affecting crypto asset service providers, ecosystems such as Cardano will be impacted.
The Cardano Foundation and CCRI have taken a significant step towards sustainability and regulatory compliance. This positions Cardano as a leader in adopting responsible and transparent practices. This could well encourage wider adoption of blockchain technology in a sustainable manner! Thus strengthening the trust of regulators, investors and users in the crypto industry.
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