China is continuing with its battle plan to drive cryptocurrencies out of its territory. A new decision places a ban on "mining" in the Sichuan province.
The Chinese government has ordered an end to cryptocurrency mining in Sichuan. This southwestern Chinese province was the second largest producer of these digital currencies in the country. The region accounted for 90% of China's mining capacity. Its shutdown is a blow to many crypto asset holders. Already in May, the country banned financial institutions, banks and companies from offering services related to cryptocurrencies and crypto transactions. The regime sees cryptocurrency as too volatile, creating significant stock market instabilities.
It is also a blow for the many Chinese "miners." Those taking part have often created mining farms in their apartments or sometimes even in their cars. In these farms, several computers are running at full speed, resulting in a lot of heat being given off and as a consequence requiring the use of air conditioning to avoid overheating. All this consumes a lot of energy, and China, in its ambition to become a greener nation, is aiming to contain this booming, polluting activity.
China shakes up the market
Twenty-six Chinese companies are concerned. They no longer receive electricity and are about to be permanently closed. After these announcements, cryptocurrency prices fell but recovered somewhat Wednesday.
This news could also have an impact on the graphics card market. Mining companies consume a lot of them, and for more than six months now, prices have been rising in the sector, especially for NVIDIA products, which are very popular among "crypto farmers." But the shortage appears to be ending and stocks recovering. Meanwhile those active in cryptocurrency, who are very present on Twitter, are exchanging tweets setting up a debate between "sellers" (those who sell) and "holders" (those who keep). It remains to be seen what will happen next.
