China looks to ban Bitcoin mining

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Bitcoin mining requires a great deal of resources which is why China's state planner is considering a ban on the practice according to a recent draft list of industrial activities the agency is trying to eliminate.

The National Development and Reform Commission (NDRC) is currently seeking public opinions on a revised list of industries it wants to either encourage, restrict or eliminate.

In total, the NDRC's draft for a revised list contains more than 450 activities, including cryptocurrency mining, that the government agency believes should be phased out for being unsafe, wasting resources, polluting the environment or not adhering to local laws and regulations.

The commission has not proposed a target date or even put forward a plan for when it wants to eliminate Bitcoin mining which suggests that the practice should be phased out immediately. The Chinese public on the other hand has until May 7 to comment on the draft before it's finalized.

Chinese crackdown

Since 2017, the cryptocurrency sector has faced heavy scrutiny in China when regulators first began to ban initial coin offerings as well as shut down local cryptocurrency trading exchanges.

The country also began to limit cryptocurrency mining due to the high amounts of electricity it requires which forced many of the world's largest firms to set up shop elsewhere.

A ban on cryptocurrency mining in China would likely cut off a key supply of cheap electricity for the industry and raise the average cost required to mine Bitcoin.

In addition to mining Bitcoin, Chinese companies are also some of the world's biggest manufacturers of Bitcoin mining gear and systems. These firms would be hit hard by a potential ban though demand for their equipment has tapered off since the height of the 2017 bubble.

Via Reuters