Xi Jinping Beats Crypto, Bitcoin Mine Closes

Jakarta, CNBC IndonesiaChina’s crackdown on trade cryptocurrency (crypto) is becoming more and more. This week, authorities in China’s northwestern Qinghai province and a district in Xinjiang ordered mining projects cryptocurrency to close.

Reported from Reuters, the Qinghai office of China’s Ministry of Industry and Information Technology ordered a ban on new cryptomining projects and ordered existing ones to be closed in the province by Wednesday (9/6/2021).

Cryptominers who set up projects claiming to run big data and supercomputing centers will be penalized, and companies barred from providing sites or power supplies for mining activities.

The Xinjiang Hui Changji Prefectural Development & Reform Commission also sent out a notice ordering the cleanup of the sector on Wednesday. The Cryptomining project in Xinjiang’s national Zhundong Economic-Technological Development Park was ordered to close.

According to University of Cambridge data, Xinjiang is the largest bitcoin mining center in China, accounting for about a third of the total computing power. Qinghai was in ninth place.

Other local governments have responded. Inner Mongolia, China’s third-largest mining hub, has published draft rules to stamp out businesses and authorities in Sichuan, in second, has announced an investigation into the sector.

China itself has stepped up its crackdown on cryptocurrencies after a global rise in bitcoin prices revived local speculation.

In addition to the State Council move, three industry bodies banned crypto-related financial services and payments, one of the factors behind the global sell-off that briefly wiped $1 trillion off the crypto market cap.

China already accounts for more than half of global bitcoin production, but some miners have considered moving elsewhere after the State Council, China’s cabinet, pledged to clamp down on bitcoin mining and trading last month.

“We stand at an inflection point for the mining industry in Asia,” said Lei Tong, Managing Director Financial Services at Babel Finance, a Hong Kong-based crypto lender and asset manager.

“Many miners are now seriously re-evaluating their future operational plans as the current regulatory environment is unfavorable for the growth and scale of their business.”

Tong said they would look for a new destination. On a global scale, Tong said, North America and Europe are the most sought after, followed by countries in Central Asia and the Middle East.

[Gambas:Video CNBC]

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