China Intensifies Hunt For Hidden Cryptocurrency Miners
Although the Chinese authorities claim to have rounded up their clampdown on cryptocurrency activities, the search for cryptocurrency miners continues. According to reports, this search is targeted at fishing out the individuals and corporations that may be carrying out crypto mining activities undercover.
One of the main reasons given by the Chinese government for going after cryptocurrency miners is to reduce carbon emission in pursuit of global compliance towards green and renewable energy. With winter approaching, the Chinese authorities have also indicated the issue of power supply as a more pressing reason for this phase of the clampdown on crypto miners.
Crypto mining banned in China
For most of 2021, China’s clampdown on cryptocurrency activities has been pronounced. Beyond the outright pronouncement of bans and restrictions like in previous years, Chinese authorities moved a step further to enforce bans and pursue crypto practitioners that failed to comply.
As a result of serious enforcement, many cryptocurrency miners in China were forced to shut down. A good number of them relocated to other regions with more friendly regulations, in addition to compatible geographical and energy situations.
Kazakhstan, Canada, and Texas were among the new homes for many crypto tycoons that fled China. Others moved to Nordic countries where the laws were also friendly, and the weather was compatible with mining activities.
Even though crypto miners received the greatest hit from the regulatory activities in China, the ban and clampdown were not restricted to them alone. Other practitioners were also affected, as users who were found after the ban was initiated were arrested on several charges, including fraud and money laundering.
Some crypto miners are still in operation in China
According to reports, despite the extensive clampdown by the Chinese authorities, some cryptocurrency miners have remained. These ones have devised resourceful strategies in evading the authorities, either by concealing their activities or disguising them as a different entity.
In suspicion of this development, the authorities in China have embarked on an increased hunt to uncover this category of cryptocurrency miners. Across several provinces, there is an increased inspection of colleges, research labs, data centers, and other potential sites. This inspection aims to uncover those that are being used to illegally engage in cryptocurrency mining activities.
Authorities in the Hebei province have already come out with a strong statement that qualifies cryptocurrency mining as an “economic and social development that will directly threaten the national security of the country”. It also stated that “virtual currency mining consumes huge energy, which runs counter to the country’s goal of ‘carbon neutrality and carbon peak’”.
Before this time, serious actions against cryptocurrency mining had been taken in the regions of Qinghai and Sichuan. These are regions that are rich in coal and hydropower that were used by a large population of miners. With miners in these regions already subdued, achieving the same goal in Hebei is highly expected.
However, as already stated, the focus of the Chinese government this time around is discovering those miners that are still in operation under the cover of legitimate businesses. It has become a game of hide and seek, as the remaining miners are devising more creative ways to avoid the prying eyes of regulators.