Crypto Mining News & Updates

The New Ban in China. Mining Under Attack

A #Chinese #government report has outlined a plan to kill #bitcoin #mining within its borders. The report, issued by the National Development and Reform Commission (#NDRC), lists #cryptocurrency mining as an industry that should be eliminated with immediate #effect.

While the #report is currently in a development stage, if enacted it could stop the recent bitcoin rally in its tracks. #Bitcoin surged 27% in the last week to hit a 2019 high, holding above the $5,000 #barrier. The proposed #crypto mining ban in China, however, could have a negative effect on bitcoin’s #value and market #capitalization. 

Bitcoin price chart

Bitcoin’s recent price surge could be crushed after news that #China plans to ba crypto mining. Source: #CoinMarketCap

CHINA’S PROPOSED BITCOIN MINING BAN, EXPLAINED

The #NDRC report outlines 450 #activities it believes #China should encourage, limit, or #ban completely. Specifically, it highlights industrial activities that infringe upon laws and regulations or have a negative impact on the #environment.

The report will be open to public #comments until the May 7th. At which time, the report will be finalized and put into #practice.

The #NDRC is a branch of the State #Council, a cabinet level authority and part of the #Central People’s #government.

BITCOIN #MINING BAN: EFFECT ON CRYPTO PRICES?

Needless to say, the proposed #mining ban would almost certainly have a negative short-term effect on the bitcoin #price.

China plays host to four of the five largest #bitcoin mining pools on the planet, including #BTC.com, #Antpool, #F2Pool, and #Poolin. In the last seven days, these four Chinese-based pools commanded more than 50 percent of the total #bitcoin mining hash rate.

Bitcoin mining pools china

China dominates bitcoin mining with four of the five largest BTC mining pools. Source: Coin Dance

At its peak, #Chinese mining firms may command up to 70 percent of bitcoin’s #hash #rate. If these pools were suddenly halted, the bitcoin #network would lose significant hash power, causing #transactions to slow down.

CRYPTO PRICES WOULD RECOVER

After a short-term price shock, it’s likely that #prices would stabilize and recover. #Bitcoin mining activity would inevitably shift out of China to other #locations. Other pools, such as Slush #Pool in  the #Czech Republic and Bitfury in Georgia would pick up the #slack.

Even major #Chinese crypto #miners appear to have seen this coming, moving some of their operations out of China. #Bitmain, for example, now has operations in the #US.

CHINA’S CRUSADE AGAINST #CRYPTO

This is by no means the first time #China has clamped down on #bitcoin activity. In 2017, it outlawed all initial coin offerings (ICOs). It also closed down crypto #exchanges, forcing #companies like #Binance to shift operations to #Malta.

#China continues to deliver blows to the #cryptocurrency industry, but it is unlikely to kill it for good. As we have seen, the bitcoin #ecosystem will simply flock to other #regions. This #time will be no different.

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