China is losing its grip on bitcoin mining, while Canada, home of vast energy resources, is lifting its cryptocurrency profile. While China has evolved into a leading domicile for bitcoin mining, the country's central bankers have been pushing back, triggering a wave of defections among mining…
China is losing its grip on bitcoin mining, while Canada, home of vast energy resources, is lifting its cryptocurrency profile. While China has evolved into a leading domicile for bitcoin mining, the country’s central bankers have been pushing back, triggering a wave of defections among mining operations to head for more cryptocurrency-friendly waters in the Western world, more specifically, Canada. Bitcoin miners are being drawn in from lobbying efforts by energy industry participants looking to proliferate the oil recovery that is unfolding in the region.
If it weren’t for bitcoin miners, investors, traders and consumers would have none of the leading digital coin with which to transact. And China is responsible for about 75% of that supply. The process places a huge demand on energy consumption, something that both Chinese regions such as Xinjiang and Canadian provinces such as Quebec boast plenty of. And with the regulatory hoops that cryptocurrency miners must jump through in China, Canada is looking better each day.
China has already been targeting smaller bitcoin mining operations. Now with murmurings of more severe pushback from Chinese regulators on bitcoin mining amid the power drain, including another blanket ban amid “concerns of excessive electricity consumption and financial risk,” Canada has become the next most attractive option amid plentiful and cheap resources and frigid winters as well as a more supportive government on cryptocurrencies. Canada’s extremely cold temperatures aid in the mining process by helping to keep the equipment cool, saving on the electricity bill in the process.
China’s leading bitcoin miner Bitmain has been diversifying from its home base and is reportedly considering moving to Canada. Meanwhile, as part of the courting process, Hydro Quebecis reportedly in engaged with dozens of cryptocurrency miners about coming to Canada, including top industry players. Meanwhile, cryptocurrency miner BTC.Top is already on its way to the Great White North.
ZQMiner, based in China’s Hubei province, is deeply engaged in the bitcoin mining process, developing and operating bitcoin mining assets across a trio of China’s provinces. The company’s CEO Li Wei told Reuters: “We, and from what I understand many of our peers, are already making plans to go overseas.”
While the Canadian government may have a friendlier stance on bitcoin mining versus China, the latter of which has banned upcoming ICOs and cryptocurrency exchanges altogether, Canada is no slam dunk. Local ICOs such as popular messaging app Kin opted to block Canadian residents from its 2017 token generating event amid “weak guidance” from Ontario regulators. Meanwhile, while the power supply is there, the bitcoin-mining infrastructure is not as pervasive, and it could take up to a year for mining operations to set up facilities in Canada’s budding crypto-mining industry.
Featured image from Shutterstock.
Last modified: May 20, 2020 9:10 PM UTC