Chinese authorities’ ‘crackdown’ on bitcoin miners will not see them banned and will instead focus on removing their preferential treatment in local provinces.
Chinese publication Ciaxin is reporting that, contrary to rumors on Wednesday, Chinese authorities haven’t asked bitcoin miners to shut down their operations in the country.
China is home to nearly two-thirds of the bitcoin hashrate with mining operations rampant in the Sichuan province and the autonomous regions of Inner Mongolia and Tibet that provide cheap hydroelectricity and cooler temperatures for the energy-intensive process of cryptocurrency mining.
Citing a source with knowledge of regulators’ moves, the ‘crackdown’ will extend to removing friendly treatment for mining centers near cheap hydroelectric power. Preferential policies in electricity consumption, tax cuts and land use for bitcoin mining centers are all under the scanner. Taking advantage of local connections, some mining facilities may also be consuming power at a lower cost, the report added.
The supposed ‘closed-door’ meeting held on Wednesday between the People’s Bank of China (PBoC) and members of a major internet finance regulator, will see authorities move to “standardize” the electricity usage of ‘some’ bitcoin miners, according to QQ.com.
Local government officials have also been asked to investigate the “nonstandard uses of electricity” after concerns that high power consumption may have affected normal electricity usage in the region, in some cases. To oversee these curbs, the National Development and Reform Commission, will also participate as the nation’s power supply regulator.
As reported previously, the ‘crackdown’ on bitcoin mining in China could prove to be beneficial to the wider bitcoin ecosystem by decentralizing the majority mining hashrate located in the country.
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Last modified: July 16, 2020 11:27 AM UTC