Hydro-Rich Chinese City Said to Clamp Down on Crypto Mining
(Bloomberg) -- A Chinese city with abundant hydropower is said to have begun a sweeping clampdown on crypto mining firms this week, following an earlier ban from the central government on such activities.
A Ya’an government official has told at least one Bitcoin miner that the city has promised to root out all Bitcoin and Ether mining operations with a year, said a person with knowledge of the situation.
Authorities of Ya’an, located in the southwestern province of Sichuan, pledged at a Thursday meeting to screen and “rectify” all Bitcoin mining firms within its jurisdiction, blockchain news platform PANews reported. Some miners were notified by their power suppliers that all plants in their area will be closed until further notice for “self-inspections,” according to the report.
Many mines in Sichuan were closed as of Sunday, the Communist Party-backed Global Times newspaper reported, without saying where it got the information. The clampdown means that 90% of the country’s Bitcoin mining capacity will be shut down, at least for the short term, the paper said
A person who answered a Ya’an government media-inquiry line said he is not aware of the matter.
The curb appears to be widening across the province. Power companies owned by the central and provincial governments in Sichuan must immediately stop supplying electricity to crypto mining projects, China Business News reported Friday, citing a notice issued by the province’s economic planning agency and energy administration.
State Grid Sichuan Electric Power Company has reported 26 suspected crypto mining projects to the government, according to the report. It added that city-level governments have been asked to start checks in their areas and shut down all such projects that are found.
The development added to a long list of actions taken in China recently to rein in the cryptocurrency industry. Inner Mongolia vowed earlier this year to shut all crypto mining projects by April, and the State Council called for a crackdown on Bitcoin mining and trading last month. Yunnan province started a probe last week into illegal electricity use by Bitcoin mining companies, Cailian reported.
About 65% of the world’s Bitcoin mining took place in China as of April 2020, according to an estimate by the University of Cambridge. Sichuan province, with its rich hydro resources, has always been one of the prime destinations for domestic Bitcoin miners who consider power supply and cost key. Ya’an accounted for about 10% of all computing power deployed in Sichuan for Bitcoin mining, according to the PANews report.
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