China's cryptocurrency mining crackdown intensifies
Keeping a tough stance on cryptocurrencies, China has issued an order to crack down on crypto mining operations in Sichuan's southwest province, Reuters reported.
On Friday, the Sichuan branch of the National Development and Reform Commission (NDRC) and the Sichuan Energy Bureau ordered cryptocurrency mining projects closed in the major mining center. The Commission demanded the closure of 26 suspected cryptocurrency mining projects by Sunday in the province.
The authorities have ordered state electricity companies in Sichuan to conduct inspections and make corrections. In addition, they have been asked to immediately stop supplying electricity to crypto-mining projects, which they have detected.
They urged the local governments in Sichuan to start combing for cryptomining projects and shut them down. In Sichuan, miners use hydropower to run computer equipment to verify Bitcoin transactions.
According to the data carried by the University of Cambridge, Sichuan is China's second-biggest bitcoin mining province. At this place, miners move their activities in the rainy summer to take advantage of its rich hydropower resources.
Mitchell Cuevas, Head of Growth at the Stacks Foundation, says that 'Proof of Work' is the mining mechanism used by Bitcoin that requires solving complex mathematical puzzles, requiring power-hungry computing resources. Why It Matters: Sichuan's crackdown indicates that China's displeasure with cryptocurrency mining extends beyond cases. Other mining centers, including Xinjiang, Inner Mongolia, and Yunnan, have ordered crackdowns on bitcoin mining.
In May, Chinese Vice Premier Liu He called for a "severe" crackdown, reiterating the government's position on cryptocurrencies. China's Inner Mongolia region has proposed punishments for companies and individuals involved in crypto mining.
According to Reuters, Chinese energy regulators are meeting local power companies to collect information on mining farms. China is the world's most prominent cryptocurrency mining location, accounting for 75% of the Bitcoin hash rate.
In 2017, It shut down all local crypto exchanges and initial coin offerings (ICOs). Price Action: At press time, BTC traded 0.22% higher at $35,900 on Saturday.