Authorities in China contend cryptocurrencies disrupt economic order, facilitate asset transfers that are illegal, and lead to money laundering.
The Chinese government is taking punitive measures to stop cryptocurrency mining, which they call an “extremely harmful” practice that undermines the effort to reduce carbon emissions.
It comes as China’s central bank has banned all cryptocurrency-related transactions, including cryptocurrency trading and mining.
Bloomberg reports that China has instructed its government companies to stop cryptocurrency mining and has threatened to raise electricity prices for institutions found to be abusing their access to subsidized power to participate in crypto mining.
In a press conference, Meng Wei, a spokeswoman for the National Development and Reform Commission (NDRC), said, “The NDRC plans to crack down on industrial-scale Bitcoin mining as well as any involvement by state companies.”
She called the crypto industry “blind and disorderly” and claimed that mining and trading crypto carries “prominent risks.”
Authorities in China say cryptocurrencies disrupt economic order and facilitate money laundering and illegal asset transfers.
Authorities in China are accusing cryptocurrency miners of energy waste, deadly coal mining accidents, and a possible threat to the country’s efforts to reduce carbon emissions.
China aims to become carbon neutral by the year 2060.
It is important to note that Bitcoin or any cryptocurrency mining demands incredibly powerful computers to solve complex mathematical puzzles, resulting in a very energy-intensive process.
A peer-reviewed paper published by Nature Communications in April reported that China accounts for more than 75 percent of Bitcoin mining.
Data compiled by the University of Cambridge’s Centre for Alternative Finance shows China used to control up to 75 percent of all Bitcoin mining. As of July 2021, the nation will not be contributing to the industry at all.