China’s series of crackdowns on Bitcoin mining keeps making headlines within the crypto community. Parts of the country like Anhui and the Yunan Province announced their intention to crackdown on Bitcoin mining earlier this year. Earlier, Sichuan province also announced crackdowns in the city of Ya’an. The area is known for its hydropower abundance, and the cheap energy made it a hub for miners.
Following the pattern
According to reports, the region of Inner Mongolia is the latest region to suffer a similar fate. Government authorities confiscated over 10,000 crypto mining machines from a retail park. The bust was carried out by China’s National Development and Reform Commission. The official press release stated,
“The Development and Reform Commission of Bayannur City, Inner Mongolia Autonomous Region and other relevant departments received reports from the masses that a warehouse piled up in virtual currency ‘mining’ equipment was found in the Small and Medium-sized Enterprise Entrepreneurship Park of Bayannur Economic Development Zone.”
After investigating the site, authorities found 10,100 crypto mining machines, which the Commission confiscated. “The power consumption for on-site inspection is 1104 kilowatt-hours,” it added.
Just recently, Chinese authorities reiterated restrictions on crypto-related activities while outlining enhanced surveillance for catching crypto mining operations. Ergo, the aforementioned development marks its first bust after the latest announcement.
That said, this wasn’t the first time such a crack down happened. As covered before, the said region became one of the first provinces in China to face crack down on crypto mining as part of the Chinese government’s energy-saving plan.
Zooming out a bit, Inner Mongolia has cleaned up and closed 45 virtual currency “mining” projects. Putting it into further context- theoretically, it could save 6.58 billion kilowatt-hours of electricity a year and convert 2 million tons of standard coal.
Since then, crypto mining has faced bans across much of the country including regions where renewables were the primary energy source, such as Sichuan.
Bitcoin’s mining difficulty is adjusted automatically after 2,016 blocks have been mined. An adjustment of difficulty upwards or downwards depends on the number of participants in the mining network and their combined hashpower. Now with this crackdown, different miners relocated themselves to “friendlier” regions such as North America, Canada and Kazakhstan. Ergo, resulting in a huge exodus. Moreso, as Chinese miners re-located and resumed operations, hashpower was expected to pick up. It surely did.
Consider the plot below, this perfectly showcases the (Hash rate) recovery from July till now. Network difficulty too portrayed a positive picture.