Bitcoin, Crypto currency, Blockchain

Bitcoin Mining ban in China: How is the current situation?

88739f4dc4e755e8598538e130907e4b - Bitcoin Mining ban in China: How is the current situation?

As reported by local media from China first met the Central Bank of China, the People’s Bank of China, already at the 03.01.2018 and held a closed session, in the abolition of the Bitcoin mining within a yet unknown period of time. A means to an end should be greater regulation of the energy consumption of the Mining companies.

Thus, the Chinese government has found a “simple” solution to the Mining industry in China. Although the Chinese can not control the Central Bank directly the energy supply of Chinese households and businesses. Instead, it has found a convenient detour. The Chinese Central Bank has instructed the national Supervisory authority for digital Finance that this is to instruct the local authorities of the provinces, to control the energy consumption of Mining companies and, if necessary, also restrict.

The justification for this action, inter alia, the safeguarding of the stability of the value of the Chinese currency, the Central Bank may determine. Due to the possible limitation of the energy consumption of the Chinese people’s party is hoping for is very likely to be a reduction of the Mining yield, and thus a Collapse of the Chinese Mining market.

China is at the moment a majority of the Mining Power, in particular for Bitcoin, but other alternative crypto-currencies responsible. The main reason for this is the extremely reasonable prices of electricity in each of the provinces of China, including Sichuan and Yunnan. For this reason, many Mining have set up data centers in these cheap provinces of China.

As the Chinese newspaper China Daily reported, should be some of the Mining companies of local governments are notified that they must limit their power consumption. Similarly, some of them are supposed to have then already, the relocation of Mining data centers in other countries such as Mongolia are planned.

The Online Portal qz reported that the Chinese Mining should be obliged companies on a monthly basis, to the 5. of each month, a report on the power consumption of the local media. The power consumption from the point of view of the Supervisory authority should be too high, this can make a limitation for the company.

The final goal of the action seems to be to move the Mining company in China, in the long term, a regulated exit from the Mining. In the last year, Chinese authorities had pronounced a Initial Coin Offering (ICO) – spell and a crypto-currency-exchanges-spell, the enthusiasm of the Chinese population for crypto curb currencies.

The decentralization of Bitcoin Mining follows?

On various Online platforms and forums to read that the Mining ban could bring something Good: Namely, the decentralization of Bitcoin Mining to be repealed by a few large Chinese Mining Pools. Alone, the five largest Bitcoin Mining Pools BTC.TOP, AntPool, SlushPool and ViaBTC all come from China and currently make up about 75 percent of the total Mining Power of the Bitcoin network.

As reported by Bloomberg, would like to Bitmain Dodge to Singapore, the USA and Canada. BTC.TOP draws, according to the report of Bloomberg to Canada, because it is more cost there is relatively low energy and a high level of political and economic stability. ViaBTC would like to open new business locations in Iceland and the USA.

Consequently, all of the major Mining seem to react to company very promptly on the measures and their operation in alternative countries. The extent to which the revised cost structures (electricity, taxes, rent, etc.) leads to the “new” countries, a shift of the Mining Power, they can not be evaluated and will show up in the near future.

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