Bitcoin falls as China takes aim once again at ‘extremely harmful’ crypto mining
The National Development and Reform Commission spokesperson Meng Wei blasted bitcoin mining during a press conference Tuesday in Beijing. She said that activity “consumes lots of energy” and “produces lots of carbon emissions.”
Meng said that the NDRC — the country’s top economic planner — will launch a “full-scale” clampdown on cryptocurrency mining by focusing on commercial mining and the role of state-owned businesses in the industry. She also said that crypto production and trade produces “prominent risks,” and blasted the industry as “blind and disorderly.”
As part of its new push, the NDRC said it would raise electricity prices for any institution found to be abusing its access to subsidized power to participate in crypto mining. Authorities have traditionally offered schools, community centers, or other public welfare institutions lower prices for electricity.
This is not the first time this year that Beijing has pledged to crack down on crypto mining.
China accounts for more than 75% of bitcoin mining around the world, according to research published by the peer-reviewed journal Nature Communications in April.
Despite its fall this week, bitcoin is still having a banner year. The cryptocurrency has surged about 110% in 2021. Last week, it hit a record high of $69,000.
China is taking aim at crypto for a few reasons. Authorities see the currencies as a big financial risk, and as a way that people can evade strict national controls on capital, and want to reign in such practices. The restrictions on decentralized currencies like bitcoin also comes as the government rolls out a digital version of the yuan, which would allow China’s central bank exercise more control over the flow and exchange of money.
The new latest effort to target mining will be “of great significance” to China’s goals to reduce carbon emissions and achieve carbon neutrality, Meng said at Tuesday’s press conference
China must “strictly prevent [cryptocurrency mining from] rising from the dead ashes,” Meng said.
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