China is stepping up its fight against mining cryptocurrencies such as bitcoins. In the southwestern province of Sichuan, a ban has been imposed on the so-called ‘mining’ of digital coins.
Many crypto coin producers can be found in that province because an ample supply of cheap electricity from hydroelectric plants and mining consumes a lot of energy.
Local authorities in Sichuan have ordered energy companies to stop supplying power to miners of digital coins. China accounts for around three-quarters of the world’s mining of all cryptocurrencies. Sichuan is a significant area for this, as is the Inner Mongolia region. The mining of cryptos is also strongly restricted, and citizens are encouraged to report illegal miners to the authorities.
Beijing has recently been tougher on digital currencies in several areas, partly because of the financial risks involved in trading cryptos. The high energy consumption in mining is also at odds with China’s sustainable ambitions. According to China, cryptocurrencies are often used for black trade, money laundering, arms smuggling, gambling and drug trafficking.
The price of bitcoin fell almost 8 percent on Monday to below $ 33,000. The prices of other digital currencies, such as the ether, were also under considerable pressure.