China orders crypto mining shut downs in more regions

[Jet_ski]

Summary

China's crackdown on cryptocurrency "mining" has extended to the southwest province of Sichuan, where authorities ordered 26 suspected cryptocurrency mining projects closed by Sunday.

 

Miners in Sichuan mostly use hydropower to run their equipment which suggests the crackdown is more broadly based. Some miners move their activities there in the rainy summer to take advantage of its hydropower resources.

 

Sichuan is China's second-biggest bitcoin mining province, according to data compiled by the University of Cambridge. The authorities urged local governments in Sichuan to start combing for cryptomining projects and shut them down. Needless to say new projects are banned.

 

Quotes

Quote

The notice orders state electricity companies in Sichuan to conduct inspections and make corrections, reporting their results by Friday. They are to immediately stop supplying electricity to cryptomining projects they have detected.

 

This video is from a TikTok user claiming to show miners in Sichuan packing up.

 

 

My thoughts

Let us all shed a tear, won’t you?! Jokes aside this isn’t surprising given that electricity shortages have forced factory shut downs in that region. This also explains why the crypto prices have been crashing this week again.

 

Sources

https://www.reuters.com/technology/chinas-cryptocurrency-mining-crackdown-spreads-sichuan-2021-06-19/

[da na]

I wonder what other countries will do this...

[Kisai]

24 minutes ago, Jet_ski said:

 

My thoughts

Let us all shed a tear, won’t you?! Jokes aside this isn’t surprising given that electricity shortages have forced factory shut downs in that region. This also explains why the crypto prices have been crashing this week again.

 

Sources

https://www.reuters.com/technology/chinas-cryptocurrency-mining-crackdown-spreads-sichuan-2021-06-19/

GPU Prices apparently dropping quickly in Europe.

 

 

[SupaKomputa]

If the miners are gone, who would store the blockchain of the current circulations?

[BuckGup]

It's funny the only reason they are doing this is they want to have total control and knowledge of their money so that's a win for Bitcoin. If anything this will move mining into the US, the difficulty will drop, and ASICs will flood the market. So basically it's a win win for everyone except the Chinese. Of course uneducated investors will think the world is ending and sell everything they own so it's a great time to buy

[BuckGup]

1 minute ago, SupaKomputa said:

If the miners are gone, who would store the blockchain of the current circulations?

There are miners everywhere across the world. Chinese just had cheeeeeap access to make ASICs by the metric butt load 

[Arika]

Honestly surprised this hasn't happened well before now.

 

Given the social credit system over there and the weird little intricacies that can drop your score this really shouldn't surprise anyone. Especially if the Chinese government can't really track the funds that these miners are earning.

[SupaKomputa]

3 minutes ago, BuckGup said:

There are miners everywhere across the world. Chinese just had cheeeeeap access to make ASICs by the metric butt load 

Yeah but i heard they make up like 60% of the total miners in the world.

In conventional banking system that would be catastrophic.

I understand this is a good news for miners elsewhere since the difficulty will drop massively.

 

[BuckGup]

14 minutes ago, SupaKomputa said:

In conventional banking system

This is why we need not worry for Bitcoin. It will most likely cause hella expensive transaction fees but China is also massive so they aren't going to shut down every mining op

[Jet_ski]

24 minutes ago, SupaKomputa said:

If the miners are gone, who would store the blockchain of the current circulations?

 

14 minutes ago, SupaKomputa said:

I understand this is a good news for miners elsewhere since the difficulty will drop massively.

I don’t know about this being good for miners elsewhere. Because China had the cheapest electricity available, that’s why most of the hash capacity was located there. It definitely won’t be as profitable elsewhere.

 

3 minutes ago, BuckGup said:

This is why we need not worry for Bitcoin. It will most likely cause hella expensive transaction fees but China is also massive so they aren't going to shut down every mining op

How can you not worry about expensive transaction fees?! It certainly looks like China is trying to shut it all down gradually. I doubt cryptos would be down this much if people didn’t think so.

[BuckGup]

1 minute ago, Jet_ski said:

How can you not worry about expensive transaction fees?! It certainly looks like China is trying to shut it all down gradually. I doubt cryptos would be down this much if people didn’t think so.

You must be new to crypto. The fees will most likely return back to normal in less than a month. 

[AldiPrayogi]

Hallelujah!

[TetraSky]

Jesus... That's a whole lot of power.

 

[Icarus_Radio]

Well, this reminds me of LTT's Tech Quickie on mining. Large mining farms in Sichuan do actually use hydroelectricity, and most of the time, they are buying the reserved power since it is costly to transfer it. And that's the reason why the electricity bill there is so cheap. Early in June, the Sichuan government holds a meeting with representatives from different fields discussing whether to shutdown the mining farms. They think the miners would consume the reserved power which would otherwise go to waste, and they can pay the bill, why not keep it? However, things changed quickly over the following days.

 

Two things lead to the shutdown of mining farms. One is many of the farms claim they are large datacenters and request funds from the government. The latter then finds out that they are lying and shut them down. (this applies to other provinces as well)

 

Another one is that recently Guangzhou find some COVID-19 cases and some areas are in lockdown. However, these areas cannot get enough power since the reserved power have already been bought by the miners. This just puts the nail in the coffin.

[Fnige]

44 minutes ago, TetraSky said:

Jesus... That's a whole lot of power.

 

how many were there to take that much power?

[StDragon]

Time for that piñata to pop!!! Raining cheap GPUs like candy. 

[Moonzy]

2 hours ago, SupaKomputa said:

If the miners are gone, who would store the blockchain of the current circulations?

If ALL are gone then no one would keep track of it

 

The probability of such an event happening is near nil

As long as a party controlling >50% of the hash doesn't appear, it'll be fine

China had more than 50% (different pools combined) at some point so I was kinda worried, so this is decent news, because at least the government didn't try to control it forcefully

 

1 hour ago, Jet_ski said:

How can you not worry about expensive transaction fees?!

Don't think transaction fees have anything to do with hash power, more to do with the transaction limit, though I may be wrong

The difficulty of the network will just adjust itself so the same amount of transaction per period of Blockchain is still the same

 

Mining profits might jump a little bit since that's less miners to split the profits, but that's about it

[Ravendarat]

Is it not reasonable to assume these people with the giant mines will just move them to another country and set up shop? I mean these guys have tremendous amounts of money, I cant see them just saying "oh well funs over". Sure there might be a brief drop off but I think this is gonna all pick up again in short order

[WolframaticAlpha]

Nvidia Said We Couldn't Game On This Crypto Mining Card... - YouTube

 

 

Views gonna skyrocket

[Kisai]

1 hour ago, Ravendarat said:

Is it not reasonable to assume these people with the giant mines will just move them to another country and set up shop? I mean these guys have tremendous amounts of money, I cant see them just saying "oh well funs over". Sure there might be a brief drop off but I think this is gonna all pick up again in short order

You can't just setup shop overnight. There's likely building leases to unwind.

[Jet_ski]

Just now, Kisai said:

You can't just setup shop overnight. There's likely building leases to unwind.

Besides the leases, they need places with cheap supply of electricity. I'm not sure where they are going to find that much excess capacity.

[Drama Lama]

4 hours ago, SupaKomputa said:

I understand this is a good news for miners elsewhere since the difficulty will drop massively.

 

Yes, but trust in bitcoin has taken a bit of damage and prices dropped

[Ashleyyyy]

7 hours ago, Mel0nMan said:

I wonder what other countries will do this...

the dutch government has wanted to ban crypto altogether in the country for a while now, but the minister of finances keeps striking the proposal down. 

[RollinLower]

2 minutes ago, Ashley MLP Fangirl said:

the dutch government has wanted to ban crypto altogether in the country for a while now, but the minister of finances keeps striking the proposal down. 

and rightfully so. all their reasons for banning crypto are pretty stupid.

[jagdtigger]

Good, lets hope other countries will follow suit.