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China’s Bitcoin mining crackdown reaches Yunnan

CryptocurrencyJun 14, 2021 03:30PM ET
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© Reuters. China’s Bitcoin mining crackdown reaches Yunnan

China’s move to clamp down on Bitcoin mining activities has continued to spread across the country with no signs of slowing down. Over the weekend, the anti-mining stance extended to Yunnan, the fourth-largest Bitcoin-producing province.

According to a report from the China Securities Journal, authorities of the province issued a notice ordering an investigation into illegal Bitcoin mining operations over the weekend. They’ve also threatened to cut power to individuals and companies that may “pose a safety risk related to their electricity usage” by the end of June, the SCMP reported.

Yunnan miners are next in lineA few Chinese provinces such as Inner Mongolia, Xinjiang, and Qinghai have already issued notices ordering Bitcoin miners to shut down part or all of their mining facilities. Yunnan appears to be the next in line, and judging by the precedents, it may not be the last.

After Sichuan, Yunnan is the second-largest hydro-power-producing province in China. Although there are reports that a significant percentage of mining operations in the region utilize renewable energy, this has not made any difference to the ongoing crackdown on Bitcoin mining. This arguably reinforces the narrative that the Chinese government is out to put an end to crypto mining operations in order to retain its control over money, as opposed to concerns on energy consumption and environmental impact.

According to the SCMP, Yunnan accounts for 5.4% of the global hash rate, making it the fourth-largest Bitcoin producer. Data on the Cambridge Bitcoin Electricity Consumption Index (CBECI) shows that China still controls about 65% of the global hash rates. Out of this figure, Xinjiang accounts for nearly 36%. Meanwhile, Sichuan and Inner Mongolia rank second and third, respectively. However, estimates from Miner Daily pegs China’s hash rate dominance at around 55%, suggesting a decline in the country’s overall control.

China’s Bitcoin hash rate dominance is slowly diminishing following its latest anti-crypto stance. Back in February, Inner Mongolia began evicting miners. By the end of April, the province had succeeded in shutting down 35 Bitcoin mining facilities.

Last week Wednesday, the Reform and Development Commission in the Changji Hui Autonomous Prefecture ordered Bitcoin facilities in the Zhundong Economic-Technological Development Park to shut down immediately. Similarly, authorities in Qinghai province ordered Bitcoin miners to shut down operations last week.

A mass exodus of crypto mining farms out of China will undoubtedly erode more of the country’s dominance.

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China’s Bitcoin mining crackdown reaches Yunnan
 

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