The energy authority in Southwest China’s Yunnan province said it has eliminated the illegal power supply from small and midsize hydropower stations to Bitcoin mining, as China continues to intensify its clampdown on crypto mining.
- In a Friday post on Weibo, China’s Twitter-like microblogging platform, the Yunnan authority said as of the end of September, it has identified 246 small and midsize hydropower stations and demanded them to stop supplying electricity to Bitcoin miners, in a move that could save up about 2 billion kilowatt-hours of power throughout a year.
- Until earlier this year, China was one of the major cryptocurrency-producing countries in the world. But all that started to change this spring as one region after another — including Inner Mongolia and Xinjiang regions, as well as Qinghai, Yunnan, Sichuan, Hebei and Gansu provinces— imposed restrictions or outright bans on crypto mining. On Sept. 24, the National Development and Reform Commission, the country’s top economic planner, jointly issued a notice with 10 other authorities to wipe out crypto mining nationwide.
- As a result of the clampdowns, crypto miners from China — which before the ban produced about 70% of the world’s hashrate for Bitcoin — have been fleeing to friendlier shores. Last week, Bitcoin’s hashrate has fully recovered to the pre-China ban level as miners appear to have settled in hospitable jurisdictions, according to data from Blockchain.com.
- Meanwhile, the Bitcoin mining difficulty on Saturday increased by 8.33%, the biggest jump since Aug. 25, according to data from BTC.com. Bitcoin mining difficulty is a measure of how hard a miner would have to work to verify transactions on the block, or “dig out” Bitcoins. The difficulty level undergoes an adjustment every 2,016 blocks, which usually takes about two weeks.
- Such mining difficulty adjustments are highly correlated to the changes in the mining hashrate, which refers to the level of computing power required to mine. The more difficult to mine Bitcoin, the less profitable for miners. When the hashrate increases, the mining difficulty typically follows.