China to slash Bitcoin mining capacity by 90% following local bans

China to slash Bitcoin mining capacity by 90% following local bans

After local authorities instructed a halt on Bitcoin mining amidst an intensified nationwide clampdown on the cryptocurrency, various Bitcoin mines in one of China's main cryptocurrency mining bases - Southwest China's Sichuan Province China, were closed recently.

Reports state that around 90% of China’s Bitcoin mining capacity can be shut down at least in the short term, as regulators are willing to take equally tough measures in important mining hubs like China's north and southwest regions.

On Friday, a joint notice by the Sichuan Provincial Development & Reform Commission and the Sichuan Energy Bureau, ordered local electricity companies to "screen, terminate, and clean up" mining operations.

26 companies, including Kangding Guorong Tech Co., and Heishui Kedi Big Data Tech Co., were notified of the issue which was possibly operating in Bitcoin mining.

Shentu Qingchun, CEO of Shenzhen-based blockchain company BankLedger, said "We had trusted that Sichuan would be a special case during the clampdown as there is a power excess in the rainy season. Chinese regulators are presently adopting  a uniform strategy, which would upgrade and get control over the booming Bitcoin mining industry in China".

As per media reports, in the last 24 hours, Bitcoin mining pools companies backed by China such as Binance, AntPool, and Huobi Pool have seen a drop of 20% to 40% in their real-time hash rates. 

The Xinjiang Uygur Autonomous Region in northwest China, the Inner Mongolia Autonomous Region in north China, and Yunnan Province in southwest China have all enacted regulations prohibiting Bitcoin mining.

The Chinese government’s actions are in a row with international financial regulator’s increased surveillance on digital currency transactions for preventing systemic financial risks and fraudulent activities like money laundering, said Wang Peng, Assistant Professor at the Gaoling School of Artificial Intelligence at the Renmin University of China.

Source Credit - https://www.globaltimes.cn/page/202106/1226598.shtml