A recent discussion issue in China’s bitcoin mining industry, the recent government directive asks local governments to continue supporting bitcoin mining and related activities.
The city of Jincheng, Sichuan, has just enacted a new law that requires hydropower companies to buy electricity from the local power grid instead of building their own generation resources. Restrictions on these companies are a response to the rapid increase of Bitcoin mining that has taken place in the area, which has been blamed for causing vast electric shortages in recent years (and also for adding to China’s growing air pollution problem). The new rules are very strict, and are designed to ensure that the hydropower companies are not using their resources to unfairly benefit themselves.
In June, the Chinese government issued two directives to the industry. First, they required mining companies to double the amount of electricity they consume. Second, they ordered that companies be fined if they fail to double their usage. In response, mining companies in Sichuan declared they would continue operating in the region. Despite the government’s double-edged threats, the industry has remained in the region.. Read more about why bitcoin will fail 2020 and let us know what you think.Bitcoin miners in China’s Sichuan province may continue to work until September this year, according to local tech publication TechNode. This decision was taken in response to recent legislation restricting these activities. Citing sources who attended a regulatory meeting on cryptocurrency miners in the region, the report says mine operators have been asked to stay in Sichuan until after the rainy season. Sources also said the decision was taken to avoid a sudden loss of economic activity (and jobs) in the region. There was no official statement at the time of publication, but the report reaffirms one of the largest retaliatory attacks in recent times. In May, Vice Premier Liu He and the State Council said restrictions on crypto currency trading and mining would soon be introduced in the country. We will crack down on bitcoin mining and the behavior of traders and vigorously prevent individual risk from being transferred to the social sphere, officials said, after which the market traded off sharply hours later.
According to industry observers, the comments follow new concerns about the energy consumption of cryptocurrencies that have proven their worth, such as bitcoin and ethereum. Mining cryptocurrencies consumes a lot of energy, which runs counter to China’s carbon neutrality goals, Chen Jiahe, head of investments at Beijing-based family office Novem Arcae Technologies, said at the time. For the uninitiated, mining uses a huge computer system that performs millions of complex calculations per second to validate transactions on the Bitcoin network (a process known as proof of work). This requires an enormous amount of energy for maintenance, cooling and operation of the machines. But some argue that coal as an energy source and fossil fuel producers leave a large carbon footprint and seem to do little good for the world. However, this contradicts China’s grandiose plan to go green and achieve carbon neutrality. Separate reports also claim that illegal coal mining, the energy source for most mining companies, has led to an increase in electricity consumption by bitcoin mining companies, increasing demand for coal in some parts of China. This has forced coal producers to restart their power plants without regulatory approval to meet demand, leading to greater safety risks and an increase in fatalities by 2021. But while all this is going on. It seems the rainy season could not have come at a better time for the country’s illustrious miners.
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This year, the city of Xinjiang in northwest China has become the latest battleground in a long-running dispute over whether to limit or allow the development of hydropower projects that provide energy to Bitcoin and other cryptocurrency mining operations.. Read more about hold on to bitcoin and let us know what you think.
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