New Delhi: China is the world’s largest mining work for bitcoin still he intensified a crackdown on cryptocurrencies by banning institutions and companies from providing cryptocurrency services to customers.
Three financial self-regulatory bodies had issued a joint notice banning financial institutions and payment companies from directly or indirectly providing cryptocurrency services to customers, including accepting the currency as payment, Nikkei Asia reported citing local media.
In this situation BTC.TOP CEO Jiang Zhuoer explained how current situation of Bitcoin mining in China is not as serious as we think.
He wrote, According to the minutes of “China Financial Stability Board”: We resolutely prevent and control financial risk…. we shall crack down #Bitcoin mining and crypto trading activities in order to prevent individual risks from being spread to the social level.
From there, we can see that the main spirit of the meeting is to “prevent and control financial risks”, to restrain social capital from flowing into #crypto mining sector which might lead to risks tranferring from individuals to the whole society.
In other words, individual mining is and has always been allowed as long as you’re responsible for your own risks and profits, whilst the mining operated by financial capital might be forbiddend.
This minutes repeated the definition for #Bitcoin trading in 2013 “Notice on Preventing Bitcoin Risks Issued by the People’s Bank and Five Other Ministries”: Financial and payment institutions shall not participate in or provide service for #Bitcoin trading.
but that Notice also stated that “Bitcoin trade, as an online purchase and sale activity, the general public has the freedom to take part in at their own risk. ”
In September 2017, all China-based exchanges were required to be shut down, but users were given enough time to withdraw their tokens and none of their crypto assets were seized by the government.
— Jiang Zhuoer BTC.TOP (@JiangZhuoer) May 24, 2021
Small miners install several miners at home;
Medium miners set dozens of miners in a warehouse or a few hundred miners in a factory;
Veteran miners find a small remote hydroelectric power plant and locate there a couple thousand miners.— Jiang Zhuoer BTC.TOP (@JiangZhuoer) May 24, 2021
Given that home-based miners need new machines, and they are not the target of this crackdown, in addition, most of the cutting-edge machines will be shipped overseas, the machines' price will remain in a reasonable price range.
— Jiang Zhuoer BTC.TOP (@JiangZhuoer) May 24, 2021
In conclusion, #Bicoin mining will exist as normal, except the mining in China will be shifted from industrial-size datacenters to home miners, small or medium sized miners. The entire Bitcoin network will always be strong even its hashrate decline by 50%.
— Jiang Zhuoer BTC.TOP (@JiangZhuoer) May 24, 2021
In the end, Chinese hashpower will flow abroad just like the Exchanges did in 2017, China will play a less significant role in the global hashpower distribution.
— Jiang Zhuoer BTC.TOP (@JiangZhuoer) May 24, 2021
During the process, there will not be obvious changes in the entire Bitcoin network, except that European and North American mining pools will rank higher than the Chinese pools.
— Jiang Zhuoer BTC.TOP (@JiangZhuoer) May 24, 2021
