Cryptocurrency Mining in China Won’t Be Outlawed
Reports from earlier in 2019 suggested that cryptocurrency mining in China would be banned. However, a recent update confirmed that this won’t be the case after all. Miners there are free to carry on as before.
The Full Story
In April of this year, the National Development and Reform Commission (NDRC) of China published a draft document. This showed a proposed list of industries to be restricted or banned. Crypto mining was included on the list.
Over 450 industries were included on this document from the NDRC. They were businesses that were seen as being difficult to regulate, unsafe or wasteful in terms of resources. Mining was in the section of industries to be completely eliminated.
Now, the final document has been published. It is called Industrial Structure Adjustment Guidance Catalog. Mining is no longer listed as an industry to be phased out in the country. This legislation comes into effect at the start of 2020, and it appears to be the definitive guidelines.
It isn’t clear whether public opinion forced this change. Or whether it came about due to shifting views on the blockchain from within the government.
How Big is Cryptocurrency Mining in China?
China is currently the biggest player in the crypto mining world. Some of the main names in it are Bitmain, Canaan Creative and Ebang. In fact, around 70% of the Bitcoin (BTC) hashtag rate is dominated by Chinese mining pools.
The scale of these operations can be seen in the recent reports of a mining farm burning down in the country. The damage to their equipment was said to be to the value of $10 million (£8.1 million).
Of course, cryptocurrency exchanges and coin offerings have been banned here. However, the authorities have typically turned a blind eye to cryptocurrency mining in China. Local reports even suggest that mining companies have come to agreements with local power stations to meet their energy needs.
This latest update is good news for Chinese miners. It now seems clear that they are free to carry on working as before. Of course, the mining of Bitcoin recently become profitable again thanks to the increase in the coin’s price.
It could also be a sign of the changing opinions here on cryptocurrencies and the blockchain. Recent comments by the President Xi Jinping have raised hopes that China will be more open to digital currencies in the future.
For the moment, cryptocurrency mining in China will carry on as before.