Media: Yunnan Energy Bureau to Unplug Bitcoin Farms
Yunnan province is reportedly joining the crackdown on cryptocurrency mining that is already underway in other parts of China. According to the South China Morning Post (SCMP), local authorities have ordered an investigation into the alleged illegal use of electric power in bitcoin mining. On Sunday, the publication cited a June 12 report from the China Securities Journal published by the Xinhua News Agency.
The newspaper revealed that the Yunnan Energy Bureau is planning to cut the power supply to individuals and businesses illegally using electricity in crypto-mining facilities or avoiding electricity bills. The security risks discovered during the checks will also be sufficient to stop mining operations, indicates a notice published by the energy administration.
The cleanup of the mining sector is expected to be completed by the end of June, Sina reported on Saturday. An energy regulator official said the inspections will be carried out jointly by various departments. Mining companies that depend on unauthorized access to electricity or avoid transmission and distribution costs will be subject to penalties, the outlet added. Sanctions also await power generation companies supporting their activities.
Yunnan’s plans to shut down bitcoin farms were covered in a Coindesk report on Friday, citing Forkast News which referred to a screenshot of a document appearing to be from the Yunnan Energy Bureau. The copy had circulated on Chinese social networks. Coindesk subsequently corrected information indicating that “The source of this claim appears to have been a forgery” and citing “several sources” which questioned the authenticity of the document.
Forkast News was also reportedly informed by an employee of the BTC.top mining pool that the company was preparing to shut down operations in Yunnan in light of impending government restrictions. However, CEO Zhuoer Jiang later denied that BTC.top had any clear idea of the province’s regulatory policy towards the industry. The executive could not verify the authenticity of the document in the screenshot while others like Chinese crypto blogger Wu Blockchain have mentionned it’s wrong.
Chinese crackdown on crypto mining continues
Media have indicated that Yunnan may be the latest Chinese region to join the country’s current crackdown on cryptocurrency mining. Similar steps have already been taken in Inner Mongolia, Xinjiang and Qinghai. Sichuan energy officials held a meeting to discuss the implications of bitcoin mining earlier this month, but according to the SCMP, they haven’t adopted any policy changes at this point.
While environmental concerns have clearly played a role in the case of Qinghai and fossil-fuel-rich Inner Mongolia, Sichuan relies heavily on cleaner hydropower. The same goes for Yunnan, which is China’s second largest hydropower producing province. Wu Blockchain commented in another tweet on Friday:
Compared to thermal energy regions such as Xinjiang and Inner Mongolia, hydroelectric regions such as Sichuan and Yunnan will be relatively tolerant of Bitcoin mining. But miners face problems after the summer, and the power supply outside China could be more stable.
– Wu Blockchain (@WuBlockchain) June 12, 2021
China aims to reduce its carbon emissions to 65% of 2005 levels by 2030. The People’s Republic accounts for about 65% of the global bitcoin hash rate (BTC), according to the Cambridge Bitcoin Electricity Consumption Index (CBECI), with Xinjiang alone responsible for nearly 36% of that. Sichuan and Yunnan rank second and fourth, respectively, while Inner Mongolia is third. It has been estimated that bitcoin mining consumes around 110 terawatt hours of electricity per year.
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