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Many bitcoin mines in Sichuan were shuttered Sunday after authorities in the southwestern Chinese province ordered a halt to crypto mining, according to a report from the Communist Party-backed newspaper Global Times. More than 90% of China’s bitcoin mining capacity is estimated to be shut down, the paper said.
Bloomberg and Reuters also reported on the move from Sichuan authorities. It follows similar developments in China’s Inner Mongolia and Yunnan regions, as well as calls from Beijing to stamp out crypto mining amid worries over its massive energy consumption.
China’s crackdown appears to have led to a significant decline in bitcoin’s hash rate — or processing power — which has fallen sharply in the last month, according to data from Blockchain.com. An estimated 65% of global bitcoin mining is done in China.
Not that I have an interest in bitcoin as an investment or speculation, but it is happening. Were environmental concerns taken into account at its inception? I doubt it.Bitcoin’s network is decentralized, meaning it doesn’t have any central party or middleman to approve transactions or generate new coins. Instead, the blockchain is maintained by so-called miners who race to solve complex math puzzles using purpose-built computers to validate transactions. Whoever wins that race is rewarded with bitcoin.
This power-intensive process has led to growing concerns over the potential environmental harm of bitcoin, with everyone from Tesla CEO Elon Musk to U.S. Treasury Secretary Janet Yellen raising the alarm. China, where most bitcoin mining is concentrated, relies heavily on coal power. Last month, a coal mine in the Xinjiang region flooded and shut down, taking nearly a quarter of bitcoin’s hash rate offline.