According to a leaked notice issued by China’s EIC, Xinjiang, a territory in northwest China has a month to shut down all of the illegal BTC mining.
Illegal BTC mining has to end in China
Illegal Bitcoin mining was recently ordered to be shut down in the autonomous region of Xinjiang. According to reports, the region has by the end of August to comply with the order issued by the EIC (Economic and Information Commission). In fact, one of EIC’s senior officials has even confirmed that the agency has issued this order, stating that Xinjiang Uyghur companies to report and end all illegal BTC mining operations by August 30.
China illegal BTC mining has become a big issue in this country recently, and it includes unauthorized mining operations done by companies that choose not to go through the industry’s formalities. Such companies avoid registration of their actions, taxes, and even social security. This is, of course, unacceptable, since the country’s regulations and laws abide them to do these things in order for their actions to be legal.
Additionally, all mining farms that fail to sign a contract with companies in charge of the power supply, and therefore register their electricity use, will be blacklisted. Reports on the progress regarding the shutdown of these mining operations are to be submitted by various utility agencies.
Finally, the EIC has threatened that all agencies and companies that fail to comply with the order will be held accountable for these illegal actions.
BTC mining companies in trouble
The CTO of a Canadian blockchain startup, Scott Meng, who has several BTC mining farms in this region will also be among those who this crackdown will hit hard. He stated that he has two partners in the Xinjiang region, as well as around 68,000 cryptocurrency miners. His partners have not received the news well, and have already urged him to find another place where their mining operations could be moved to.
The biggest problem that Meng is facing right now is the issue of getting the necessary electricity for cheap in the new location. Not only that, but the new farms would have to be rebuilt in their entirety.
The EIC’s move is only the latest one in the entire string of various methods for recouping the electricity rates for illegal Bitcoin mining operations. Additionally, the agency wishes to ensure that the region does not fall even deeper in the illegal mining.
The previous attempt by the agency to do something about this has involved a warning issued last month. The warning was aimed at municipal governments of Xinjiang regarding the support for companies that are entering BTC mining. According to the agency, such companies, and their actions are not contributing to the region’s economy. The only thing that they are doing is consuming large volumes of electrical energy.
The region’s cheap power is mostly the reason why so many Bitcoin mining companies have decided to call it home. Interestingly enough, China is responsible for over two-thirds of the global computing power dedicated to mining cryptocurrencies. Not only that but is also where the major mining hardware producers are located. This means that China is also where the greatest mining pools in the world are operating from.