The Chinese government is on the move again, this time zeroing in on the practice of Bitcoin mining in its Inner Mongolia region.
Greg Thomson at Cointelegraph reports that the government is considering draconian punishments for anyone found to be mining Bitcoin in the jurisdiction.
For example, Chinese officials are talking about revoking business licenses for any entrepreneurs or business leaders who may be using resident energy to mine the cryptocurrency.
Another possible consequence is China’s use of a “social credit blacklist” to destroy the credit standing of users who are found to be mining Bitcoin. This type of crackdown is reminiscent of the fictional narrative in Gary Shteyngart’s “Super Sad True Love Story” novel where transparent and manipulated credit scores subject the citizenry to ever-growing scrutiny and control. There’s also reportedly a hotline in place for snitching, showing how serious central Chinese planners are about lowering the number of Bitcoin miners in-country. The government insists this is part of China’s goal to become carbon neutral by 2060.
“China’s determination to rid itself of Bitcoin miners has already had a knock-on effect,” Thomson writes. “Three mining companies — BTC.TOP, Huobi and HashCow — announced they were closing down their operations in the Chinese mainland earlier this week.”
How ubiquitous is BTC mining in China? A May 2 piece in Fortune Magazine by Eamon Barrett reveals that 70% of Bitcoin’s hash rate comes from areas in the middle kingdom and 8% of all mining for Bitcoin is done in the Inner Mongolia region.
“Blockchain enthusiasts tout Bitcoin and its cryptocurrency kin as decentralized digital assets, but the massive computing power required to maintain the digital ledger is heavily concentrated in a single country: China,” Barrett writes.
With Chinese officials cracking down, what will happen to the practice of BTC mining? Look for the results in markets.
