Cryptocurrency miners in China may move their operations overseas as Beijing intensifies its crackdown
- The Chinese government intensified its plans to crackdown on
cryptofarms last week.
- Crypto miners are worried about regulatory pushback in China, and are looking to move their mining farms to other countries
- Two of the top crypto miners in the world said they are shutting operations in China.
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Two of the top crypto miners in the world — Huobi Mall and BTC.TOP — announced that they are suspending their operations in China, over the weekend. “Meanwhile, we’re contacting overseas service providers, to pave the way for exports of mining rigs in the future,” Huobi Mall said via its official Telegram community.
“In the long term, nearly all of Chinese crypto mining rigs will be sold overseas, as Chinese regulators crack down on mining at home,” wrote Jiang Zhuoer, the founder of BTC.TOP, on Chinese social media Weibo. BTC.TOP is a crypto mining pool, a common occurrence in the industry where multiple miners combine their resources to make one big mining operation.
HashCow, another miner that runs 10 mining farms in the Xinjiang and Sichuan provinces of China, also said it will be stopping its operations in order to comply with regulations.
The moves all came after the country’s State Council committee, which is led by Vice Premier Liu He, announced that it will be cracking down on crypto mining operations in the country. And China’s reasons for the crackdown are quite similar to what most regulators have said so far. The country doesn’t want to promote speculative trading that happens in the crypto industry, but more importantly, crypto mining takes tons of energy that are produced by non-renewable resources and is against the country’s environmental goals.
The government in China’s Inner Mongolia region, another big area for mining farms, had also started crackdowns over the past few months. In fact, the government in that region had recently started a hotline that would allow citizens to report any mining operations in the area.
How did this affect the price of cryptocurrencies?
The moves by various miners and exchanges have also led the trading world to speculate, driving prices of cryptos down worldwide. At the time of writing (3.54 pm IST, May 24), the price of Bitcoin was down by almost 50% of its peak value a few weeks ago. The top cryptocurrency was trading at around $36,504, according to Coinmarketcap.
On the other hand, Ethereum, which showed a seven-day drop of over 34%, was trading at $2,269. Popular currencies like Dogecoin, Litecoin, and more were also down. Doge was trading at $0.32 while Litecoin traded at around $158.
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