China Crypto Roundup (1-8 June): Chaos and Anxious
The Chinese cryptocurrency sphere this past week has been stirred up with many instable factors. Bitcoin miners are anxious as Sichuan and Yunnan are starting to crack down on illegal bitcoin mining farms; Bitcoin giant Bitmain was entangled in the internal struggle once again; crypto traders are panic seeing their bank cards frozen in OTC transactions; crypto firms are turning to street vend their products and services…
Sichuan and Yunnan crack down on bitcoin mines directly fueled by power plants
Sichuan and Yunnan, China’s southwestern provinces with the country’s largest concentrations of bitcoin mining, have been cleaning up crypto mining farms that operate in a legal grey zone by getting cheap electricity directly from hydropower plants.
In China, electricity shall be supplied by local or national grids rather than directly from power plants. While power-hungry mining activities, to lower their costs, usually get cheaper electricity directly from power plants, or even steal electricity.
Impacted by the coronavirus, the State Grid reported negative profits in the first quarter. Cracking down on the direct power supplied mining farms would be conducive to protect the interests of the demonstration area and the State Grid, but it would be a disaster for small-scale crypto mining farms and hydropower plants.
Bitmain cofounders hard fork the company
The power struggle inside the bitcoin mining giant Bitmain has once again intensified these days, as the previously ousted cofounder Micree Ketuan Zhan on Wednesday led a team of guards “break into” Bitmain’s Beijing office to claim his return.
It seems there has been a hard fork of the company, with Zhan trying to convince employees about his legal status and urge them to join him, and Bitmain Beijing on the other side claiming that Zhan had been removed from any roles of the company since October 2019.
There’s even a “hard fork” of the company’s official seal by Zhan. A statement from Zhan’s “Bitmain Beijing” circulating online these days claimed that the previous seal of the company had been invalidated and the new one had come into use since June 1.
The company’s employees are now confused and caught in the middle, whether to return to the office and which executive to choose. The drawn-out power struggle inside the company has also cast doubts among investors and customers over the management and future performance of the world’s largest bitcoin mining hardware manufacturer.
Massive bankcards frozen for OTC trade
Crypto traders are complaining that their bank cards are frozen when conducting OTC trading in China, as some people are using the channel for large sums of money laundering.
Users on crypto exchange Huobi has been the most affected, as over 80% of OTC transactions happened on the platform. A lot of traders on other crypto trading platforms have also reported similar freeze cases.
It is reported that the massive freezes are a result of the recent police crackdown on telecom fraud and money laundering. OTC Tether/USDT trade has been the most popular way for money laundering among telecom fraudsters.
Street vending your cryptos
Upon the country’s premier Li Keqiang’s support for the street vendor economy which aims to help manage unemployment crisis caused by the coronavirus outbreak, crypto firms are also keeping up with the trend and become street vendors.
These crypto influencers go to the street and set up stalls with easy-made cardboards, not only street vending their physical mining machines and cryptocurrencies, but also taking advantage of the opportunity to advertise their financial derivatives, wallets, company swag…