chinese crypto mining closed

Chinese crypto mining sites close due to environmental laws

Inner Mongolia issued a Development and Reform Commission ban to prohibit crypto mining industries in the region starting in May. This is in support of the regulations implemented by the government of China in its efforts to become carbon neutral by 2060.

Only two out of the four major crypto mining provinces, Yunnan and Sichuan remain in operation after the Development and Reform Commission ban.

According to an article by cryptocurrency blog channel Wu Blockchain, some mines in Inner Mongolia have been shut down while the rest moved their machines to other mines in Sichuan and Yunnan where hydropower parks operate.

According to Wayi co-founder Peicai Li, miners are turning to hydro-powered mining hotspots as the government cracks down on fire powered plants that support crypto mining.

‘Hydropower is the most compliant way for miners and it has the cheapest electricity in the rainy season,’ Peicai said in the Chengdu Mining conference. He also concluded that in any event, the miners will still face power setbacks when the dry season comes.

However, financial and economic newspaper National Business Daily reported on March 3, 2021 that Chinese crypto miners are pursuing a work-around to the ban that involves moving the mining operation out of the country.

Forkast news, a digital media platform for business, economy and politics accounted for several Chinese mining businesses that have moved their operations in countries such as Russia, Belarus, Kazakhstan, Iran, Malaysia, Myanmar and Iceland.

Meanwhile, Yin Gao, director of Fidelity Investment, a major brokerage service provider online, mentioned in a crypto mining conference held in Sichuan province that Chinese crypto mining companies should learn how to innovate and develop new energy sources to generate hash rate as a long term plan for their companies as well as for the sake of compliance.

The crypto ban in Inner Mongolia is not the first regulatory effort in the region. In September 2019, the local government launched an inspection to stop illegal Bitcoin operations.

Once a crypto mining hotspot in China, Inner Mongolia accounted for 8% of the computing power to run the global blockchain. However, crypto mining in the region is considered a low return and high polluting industry since it is powered by coal-powered electricity.

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