Chinese authorities are taking disciplinary actions to obstruct cryptocurrency mining, describing it as an “extremely harmful” system that endangers the country’s attempts to decrease carbon emissions. This development arrives as China’s central bank performed all cryptocurrency-related activities unlawful, including crypto trading and mining.
According to a paper by Bloomberg, China reported its government firms to stop cryptocurrency mining and stated it would increase electricity charges for any organisation found to be violating its access to subsidised power to engage in crypto mining.
“The National Development and Reform Commission (NDRC) plans to crack down on industrial-scale Bitcoin mining as well as any involvement by state companies,” Meng Wei, a spokeswoman, said at a press gathering. She maintained that crypto mining and trade arrived with “prominent risks” and reviled the crypto industry, terming it “blind and disorderly.”
It should be noted that Bitcoin or any cryptocurrency mining demands high-powered computers that are fighting to unravel complex mathematical puzzles in a manner that makes exhaustive use of electricity. Interestingly, prices of mining rigs also dropped after China inflicted a ban—one crypto mining machine, which traded about 4,000 yuan ($620) in April and May, could now be purchased for as cheap as 700-800 yuan, according to a Reuter’s report.
Interestingly, China estimates above 75 per cent of Bitcoin mining, according to research issued by the peer-reviewed journal Nature Communications in April. The country went from managing up to 75 per cent of all Bitcoin mining in the world in April to not committing to the industry at all as of July 2021, according to data gathered by the University of Cambridge’s Centre for Alternative Finance.
Meanwhile, the prices of Bitcoin dropped today, sliding almost 5 per cent to $60,971.56, and Ether fell as much as 6 per cent, according to coin gecko.