Inner Mongolia Crackdown on Cryptos Tied to Energy Consumption

Asia Blockchain Review
September 24, 2019

A move by the Inner Mongolia Autonomous Region in northern China to do away with unregulated crypto mining has been tied to its heavy use of non-renewable energy.

In an article by Bitcoin Magazine, it was reported that Inner Mongolia’s recently declared stance deeming crypto-mining unbeneficial to China’s economy was linked to earlier decisions in the autonomous region.

Officials to No Longer Allow Unregulated Crypto Mining

Earlier this week, the five bodies of the Inner Mongolia Autonomous Region comprising the Development and Reform Commission, the Public Security Department, the Department of Industry and Information Technology, the Financial Office and the Big Data Bureau resolved to do away with cryptocurrency mining, collectively stating that “the ‘mining’ industry of virtual currency belongs to the pseudo-financial innovation unrelated to the real economy, and should not be supported”. 

Their decision parallels a similar stance taken in Xinjiang province earlier this year. Once the leading area for cryptocurrency mining in China, Xinjiang saw authorities begin cracking down on illegal mining operations in July.

A Burden on China’s Energy Supplies and Environment

Bitcoin Magazine further tied these moves to the cryptocurrency mining industry’s massive use of power, especially non-renewable energy.  It noted that China’s state planner in April this year stated that crypto mining had become a burden on both the country’s energy supplies and the environment, and should therefore be eliminated.

The power grids of Inner Mongolia and Xinjiang feature a small proportion of renewable energy, with much of their power still based in coal.  While no clear data was presented as to how much electricity was being used by Chinese crypto miners, the practice of mining is highly power-dependent.

Source: bitcoinmagazine.com


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