China Declares War on Crypto Mining; Bitcoin Rises

China declares war on crypto mining and eradicates all the projects by April. Inner Mongolians of China will take further steps to cancel this power-hungry practice.

According to Inner Mongolia Development and Reform Commission’s website, banned new digital coin projects. This draft came into the public eye on February 25.

The region now aims to cut emissions per unit of gross domestic product by 3% this year and control incremental growth of energy consumption at about 5 million tons of standard coal, according to the draft plan.

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Chinese officials first outlined proposals in 2018 to discourage crypto-mining — the computing process that makes transactions with virtual currencies possible but consumes vast amounts of power.

Inner Mongolia, which is clustered with large coal mines, is famous for inexpensive energy and has attracted investment from a plethora of power-intensive sectors such as aluminum and ferro-alloy smelting over past decades. The region accounted for 8% of global Bitcoin mining computing power, according to the Bitcoin Electricity Consumption Index compiled by Cambridge University. China overall had over 65% of the network’s total, with its appealing combination of inexpensive electricity, local chipmaking factories, and cheap labor.

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Therefore, the local crackdown is reviving old fears of crypto mining. Beijing since 2017 has abolished initial coin offerings and clamped down on virtual currency trading within its borders, forcing many exchanges overseas. The country was once home to about 90% of trades but the lion’s share of mining, but major players like Bitmain Technologies Ltd. have since fled abroad.

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