Hydropower plant in China fined for supplying energy for mining

Also, law enforcement officers will confiscate the profits from the sale of the resource for cryptocurrency mining

25.05.2022 - 08:10

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2 min

What’s new? Chinese authorities fined a hydropower plant in Hubei province 43 493 yuan ($6516 at the exchange rate on May 25) for illegally supplying electricity for mining cryptocurrencies. This was reported by Yahoo Finance.

News on the Yahoo Finance website

What other sanctions have been imposed on the company? In addition to imposing a fine, the authorities decided to seize profits from electricity sales of 21 417 yuan ($3208), according to a preliminary notice issued last week by a local branch of the National Energy Administration.

What happened before? In May 2021, China was the leader in bitcoin mining, accounting for 70,9% of the global hashrate. However, after a total ban on cryptocurrency mining in July 2021, the figure dropped to zero and only started to grow in September, reaching 30,4 EH/s. Amid the ban on mining in the PRC, income from BTC mining in August 2021 increased by $35 million per day.

In September 2021, the People's Bank of China (PBOC) declared all financial activities related to bitcoin and other virtual currencies illegal. The services provided by cryptocurrency exchanges to Chinese residents were also illegal.

Despite the ban on cryptocurrencies and mining, China managed to return to second place in the world in terms of bitcoin hashrate. The country accounts for 21% of the computing capacity for BTC mining.

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