Chinese authorities reveal plans for outright cryptocurrency mining ban, despite China being one of leading crypto mining nations.

The cryptocurrency mining ecosphere could be about to undergo a seismic shock, as reports suggest Chinese authorities are considering banning crypto mining.

According to a Reuters report on 9^th April, China’s state macroeconomic planning agency the National Development and Reform Commission (NDRC), is mulling whether or not to ban crypto mining.

Apparently, as part of its long-term Catalogue for Guiding Industry Restructuring, the agency has drafted a list of more than 450 industrial activities that it deems to be either in violation of existing laws and regulations, unsafe or damaging to the environment.

Alarmingly, for crypto miners in China, it seems the plans, which are now open to public feedback until 7^th May, don’t call for a gradual phaseout, but rather an immediate ban – something which could devastate business plans and investment in the sector.

Though the Chinese authorities have long displayed hostility towards anything that smells of decentralisation, illustrated by the imposition of a ban on initial coin offerings (ICOs) by the People’s Bank of China back in 2017, so far the state’s moves to discourage crypto mining have been half-hearted and singularly unsuccessful.

Despite some Chinese miners already curtailing operations due to rising electricity costs in some regions, as recently as March, attracted by the still relatively cheap electricity and hardware, mining giant Bitmain revealed plans to bring 200,000 new mining units online in the country – something which must now be in doubt. Indeed, despite the simmering hostility, some estimates suggested two-thirds of global crypto mining pools were China-based until recently.

AYO.NEWS says:

Taking a step back and looking at the big picture, the Chinese authorities were always going to turn against crypto mining at some point, given that the fundamental nature of cryptocurrencies (i.e. their decentralisation), is at odds with the core principles of the highly controlling and still very centralised Chinese government. Of course, it is unlikely they will cite this as a reason for banning mining – instead they will no doubt highlight the ‘environmental damage’ caused by crypto mining, in terms of power consumption.

It will be interesting to see if other nations in the region benefit from the approaching exodus of crypto miners from China, or if companies will go further afield.