Regulatory crackdown sets off tide of consolidation in mining circles: Xinjiang, Sichuan suspend power supply to mining farms in some areas Many mining pool-related companies divest domestic-related businesses in a hurry

While large mining farms have set off a wave of overseas mining, many small and medium-sized mining farms have not seen any action

Regulatory crackdown sets off tide of consolidation in mining circles: Xinjiang, Sichuan suspend power supply to mining farms in some areas Many mining pool-related companies divest domestic-related businesses in a hurry

Last Friday, the State Council’s Financial Committee proposed “cracking down on bitcoin mining and trading” in a meeting. As a result of this, a consolidation of the mining community is underway: several well-known mining pools and related companies are divesting their domestic businesses. The famous mining pools such as Firecoin Mining Pool and Lepit Mining Pool have suspended the provision of mining machine hosting and other related services to mainland China, while mining pool service providers such as Bitcoin Fawn and Mars Cloud Mining have blocked IP access in mainland China.

The reporter found that in the large mining farms have set off overseas mining wave, many small and medium-sized mining farms have not seen any action. As a large number of mining machines are difficult to sell in a short period of time at an ideal price, and the high cost of overseas mining is more difficult to bear, “difficult to move” they are more hopeful that the local regulation can be “high and light”, leaving some leeway.

Parts of Xinjiang and Sichuan
“Suspension of power supply to mines”
“At the moment, the whole mining circle is in a state of panic.” A senior mining media practitioner told the Securities Daily, “In the past, it was generally believed that bitcoin was defined as a virtual commodity, and there were no relevant legal provisions regarding bitcoin mining behavior, and the mining activity itself may not be illegal, but this time the Financial Commission clearly proposed to crack down on bitcoin mining behavior, which made the whole industry more panic. “

The reporter learned that the mining circle is now waiting to see how the regulatory measures in Xinjiang and Sichuan fall into place. From the domestic situation, bitcoin and other virtual coin mining sites show obvious seasonal distribution characteristics, when the abundant water period (summer and autumn) mining sites to Sichuan, Yunnan and other hydropower areas, dry water period (winter and spring) to thermal power resources rich in Xinjiang, Inner Mongolia and other places to migrate.

“In the past two days, there has been a suspension of power supply in individual mines in Sichuan.” A senior practitioner in the mining circle revealed to the “Securities Daily” reporter, this round of regulatory measures came “fierce”, in recent days, Xinjiang, Sichuan, some areas have suspended power supply to certain mines, these mines have begun to self-examination and rectification.

In the opinion of the mining veteran, the industry is generally worried that Xinjiang and Sichuan may also continue the strict regulatory measures in Inner Mongolia, for mining activities to crack down.

The company’s first major project is the development of a new product, a new product that will be released on May 25. In which, not only mentioned industrial parks, data centers, self-provided power plants, Internet enterprises, Internet cafes and many other subjects involved in mining will be seriously pursued in accordance with relevant laws and regulations, but also the existence of virtual coin mining behavior of the relevant enterprises and related personnel, in accordance with the relevant provisions of the blacklist of untrustworthy.

“This will bring a greater impact on the mining enterprises, in a period of policy uncertainty engaged in mining will have a greater policy risk. Specific policies are believed to be introduced around the world one after another according to the actual situation, such as hydropower mining in Sichuan, whether it will form a special local policy, further observation is needed.” Long Dian, founder of FireNews Finance, told “Securities Daily”.

At the same time, according to Sina Finance, the National Energy Administration Sichuan Regulatory Office issued a notice on the convening of a research forum on virtual coin “mining”. The notice said that according to the relevant requirements of the National Energy Administration, in order to fully understand the situation related to virtual currency “mining” in Sichuan, decided to organize a research symposium, which will be held on June 2, 2021.

“During the water harvest, Sichuan’s hydropower is cheaper, and because it is difficult to store or transport electricity, much of the redundant power is used for bitcoin mining.” Wu Hongliang, the former head of public affairs for Bitmainland, analyzed to the Securities Daily reporter that using resources such as “wastewater” for bitcoin mining during the water harvesting period can promote surplus hydropower consumption, which can also bring considerable financial revenue to the local area while boosting employment.

“Stop Service” and “Ban IP”
Many mining pools are on fire to divest their business
In recent days, a number of well-known companies in the cryptocurrency and mining circles have taken a stand to stop providing related mining services to users in mainland China in order to cope with the risks brought about by the policy.

It is understood that if a mining farm is a collection of bitcoin mining hardware equipment, then a mining pool is a collection of miners’ computing power. Specifically, a mining pool is an open, fully automated mining platform where miners connect their own mining machines to the pool, contribute their arithmetic power to jointly mine and then gain revenue.

“Firecoin suspended the provision of mining pool hosting services to domestic users.” A source close to Firecoin told the Securities Daily reporter that since this year, the pace of globalization of the mining mall business has been increasing, and in order to focus on expanding overseas business, the mining mall has decided to suspend the provision of related services for users within mainland China. The solution for mining machines held by old users will be subsequently notified to customers.

Jiang Zhuoer, CEO of Lepit Mining Pool, said in a Weibo post that “the joint mining business will not be open to mainland China anymore, and the mine will be deployed mainly in North America to mine behind”. Previously, some media reported that Jiang Zhuoer had announced on Weibo that the Lepitcoin mining pool had stopped the mining machine proxy service for customers in mainland China. However, the reporter found that the relevant microblog did not exist. The reporter asked Jiang Zhuoer to confirm this, but did not receive a reply as of press time.

The mining pool service providers BitLite and Mars Cloud Mining have also announced one after another that in order to actively cooperate with the regulatory spirit of the relevant countries and regions and support the compliant development of the mining industry, they will block all IPs in mainland China to further ensure that the platform does not provide services to residents in mainland China. The reporter further found that the official website of Bitty Deer is currently unavailable, showing “We are unable to provide services to users in this region”. The website of Mars Cloud Mining is also unavailable and has a similar statement.

U.S. listed Bit Mining has announced that it is building mines in the U.S. and Kazakhstan. Bit Mining said it intends to invest more than $25 million to build a virtual coin mine in the United States with a wholly owned subsidiary of Bit Fawn; it intends to invest more than $9 million to build a mine with a Kazakhstan company in the region.

Wu Hongliang told the Securities Daily reporter that the FSC’s heavyweight voice has a big impact on the mining industry. Due to this incident, a large number of domestic miners are now ‘going abroad’ to find suitable sites to build new mines, mainly in the United States, Kazakhstan, Russia, Canada and other places, which has led to local sites have become in short supply,” he said. Also, a number of miners are selling off bitcoin miners in the country.”

“The withdrawal tide has already started, with a number of large mining sites already looking for opportunities to go offshore, and in the medium to long term, the domestic mining industry will enter a contraction phase and ‘going offshore’ will become the norm.” Long Dian said.

The reporter observed that, compared to large mining farms that choose to go overseas to mine, small and medium-sized mining farms are not following up on the move. “At present, some large mining farms have begun to layout overseas. For small and medium-sized mining farms, the cost of ‘going overseas’ is afraid to be unaffordable, and small and medium-sized mining farms are afraid of a wave of bankruptcy or a transitional model of family, decentralized or small workshop mining, but the cost will be very high.” Ding Feipeng, director of the criminal department of Beijing Shanghuang Law Firm, explained to the Securities Daily.

“It has been a general trend for mining pools or mining farms to withdraw from key regulatory areas, or even ‘go abroad’.” Ding Feipeng analyzed to the reporter, the withdrawal of mining farms or mining pools, on the one hand, is conducive to the energy saving and environmental protection of the place of relocation, conducive to reducing carbon emissions, but also conducive to the return of the price of domestic graphics cards, hard drives and other accessories; on the other hand, mining-related upstream and downstream enterprises or face operating pressures, related practitioners will also face the problem of re-selection of employment, while a specific period of time there is a surplus of power plants may also face energy depletion and revenue The problem of reduced revenue.

Finally, Ding Feipeng reminded, “In the latest regulatory situation, if you continue to engage in mining business, you may face the pressure of electricity prices, land, taxation and environmental protection, etc., and will subsequently face joint enforcement, suspension or blacklisting and other penalties.

Posted by:CoinYuppie,Reprinted with attribution to:https://coinyuppie.com/regulatory-crackdown-sets-off-tide-of-consolidation-in-mining-circles-xinjiang-sichuan-suspend-power-supply-to-mining-farms-in-some-areas-many-mining-pool-related-companies-divest-domestic-related-b/
Coinyuppie is an open information publishing platform, all information provided is not related to the views and positions of coinyuppie, and does not constitute any investment and financial advice. Users are expected to carefully screen and prevent risks.

Like (0)
Donate Buy me a coffee Buy me a coffee
Previous 2021-05-28 00:16
Next 2021-05-28 00:28

Related articles