The ban has reached Sichuan! China's total ban on mining is a foregone conclusion. Where does Bitcoin go?
Author: Zhou Ailin
Following Inner Mongolia, Qinghai and other places, Sichuan Province, which is rich in water resources and gathers many cryptocurrency mines, has also started clearing and retreating mining projects.
Following Inner Mongolia, Qinghai and other places, Sichuan Province, which has a large number of cryptocurrency mines due to abundant water resources, has also initiated the withdrawal of cryptocurrency mining projects.
Although people from all walks of life once believed that a cleaner hydroelectric power generation model could "survive" Sichuan.
A document entitled "Notice of the Sichuan Development and Reform Commission and the Sichuan Energy Bureau on the Cleanup and Shutdown of Virtual Currency'Mining' Projects" recently obtained by a reporter from China Business News shows that it is required to complete the screening and shutdown of key objects. The power company has investigated and reported 26 virtual currency "mining" projects, and completed the screening, cleanup and shutdown before June 20.
At the same time, it is required to carry out self-examination and self-correction of power generation enterprises, and to conduct a comprehensive clean-up and investigation. The self-inspection, rectification and clean-up and shutdown will be reported separately before June 25.
The two miners also told reporters that some large mines have been shut down. Although their Sichuan mines have not yet been affected, the shutdown may only be a matter of time.
At present, the price of graphics cards and China's overall computing power have fallen sharply. What will happen to Bitcoin in the future?
China bans virtual currency mining
Due to the tight electricity supply in China this year, it is not surprising that mining activities in areas such as Inner Mongolia and Xinjiang, which are dominated by thermal power and are more polluting, have been suspended.
But recently, the ban has reached Sichuan, which is rich in water resources and mainly uses clean energy for power generation.
This was not the case in the past.
A virtual currency "miner" told this reporter, "Because Sichuan is rich in water resources, it will be wasted if it is not used. In the past, there was actually a saying that mining was used to help the poor in Sichuan."
The situation changed just over a month ago.
Starting on May 18, the three associations issued announcements to prevent the risk of virtual currency trading speculation; then, the Inner Mongolia Development and Reform Commission issued the "Announcement on the Establishment of a Virtual Currency "Mining" Enterprise Reporting Platform"; subsequently, the State Council Financial Stability and Development Committee held a meeting The 51st meeting stated that it would crack down on Bitcoin mining and trading.
"This time it can be said to be a complete farewell," a mining machine manufacturer told reporters. "The process of de-sinicization of mining has already begun."
“The large mines are indeed shutting down, and the implementation of small and medium-sized mines is still uncertain. The miners have indeed reported that they have been'powered out'.” A person in the currency circle told reporters.
The above-mentioned documents obtained by a reporter from China Business News show that it is required to complete the screening and shutdown of key objects. The State Grid Sichuan Electric Power Company has currently investigated 26 virtual currency "mining" projects, led by the relevant city (prefecture) government, and State Grid Sichuan The provincial power company and the provincial energy investment group cooperated to complete the screening, clean-up and shutdown work before June 20.
The aforementioned 26 virtual currency "mining" projects include: Heishui Kedi Big Data Co., Ltd., Jinchuan Kedi Technology Co., Ltd., Lixian Hengye Tianchen Technology Co., Ltd., and Malkang Hengye Tianchen Technology Co., Ltd., etc.
The main body of power supply is basically the State Grid Sichuan Company.
At the same time, the document also mentions that power generation companies are required to conduct self-examination and self-correction, and report the asset clean-up and rectification before June 25; in addition, a comprehensive clean-up and investigation is required.
The virtual currency "mining" projects found in the investigation must be shut down, and the situation of the cleanup and shutdown will be reported before June 25. It is strictly forbidden to approve virtual currency mining projects in various names.
Graphics card prices and computing power plummet
As a result, the price and computing power of graphics cards have dropped significantly.
The computing power determines how long it takes to mine a Bitcoin block, which has a direct impact on the price.
In the global Bitcoin mining network, Chinese miners have always occupied a dominant position. According to multiple authoritative data, basically two years ago, the computing power owned by Chinese mining pools accounted for 65% of the entire Bitcoin network.
Data from BTC.com shows that the current average computing power of the entire Bitcoin network is 126.83 EH/s, which has fallen by nearly 36% compared to the historical high of 197.61 EH/s (May 13).
At present, the computing power of AntPool, China's top mining farm, has fallen by 27.53%, BTC.com has fallen by 18.34%, and Huobi.pool has fallen by 36.79%.
In addition, from 23:40 on June 19th to 00:48 on June 20th, no Bitcoin block was dug within one hour.
Earlier news also broke that at midnight on June 20th, Sichuan Bitcoin and other virtual currency mining machines were collectively powered off. Bitcoin miners who were too late to transfer may suffer losses as a result.
In addition, the price of graphics cards, which continues to soar, has recently fallen.
RTX 3090, Nvidia's strongest consumer graphics card, the representative product of this round of graphics card skyrocketing, has fallen 32%.
There are two main reasons that affect the price fluctuation of graphics cards-insufficient production capacity and limited mining.
According to the reporter's understanding, the price of the graphics card, which was originally used for playing games, was also fired up due to fanatical mining operations.
Virtual currencies collapsed across the board in May, and China began to ban mining and virtual currency transactions. Gamers were all excited and hoped that the price of graphics cards would also plummet.
However, the price of graphics cards remained unchanged in May, but recently, as China continues to show its determination to crack down on mining activities, graphics card prices have finally loosened.
The market research agency JPR judged that in the first quarter of this year, about 700,000 graphics cards flowed into the hands of miners, accounting for 25% of the total graphics card shipments in the quarter, and the amount was about 500 million US dollars.
At present, on some platforms, the price of 3090 graphics card is basically between 18,000 and 22,000 yuan, with a price cut ranging from 2,000 to 5,000 yuan; the price of 3080 graphics card is basically between 13,000 and 16,000 yuan, with a price cut ranging from 2,000 to 4,000 yuan.
Increased currency price volatility
This is just the beginning.
At the same time, as the global cryptocurrency regulatory landscape continues to evolve and the currency tightening cycle approaches, currency price fluctuations will intensify.
China Business News reported earlier that the miners in China are indeed in a difficult time.
“It is difficult for large mines to operate under strict supervision, but there are also many individuals who own mining machines. For example, dozens of such machines may not have much impact. Small miners with only a few mining machines may also dig at home. This is a "decentralization" of mining," a person in the currency circle told a reporter from China Business News. "For large mining farms, "going to sea" is a step that has to be considered."
"Some miners are already planning to go to sea. The miners in the circle have considered shipping the mining machines together. If there is no alternative, they can only accept additional costs." A person in the circle said before.
According to the reporter’s understanding, some miners had previously chosen to wait and see, looking forward to the release of more detailed policy documents; some low-cost miners commissioned miners to resell their mining machines, and some capable and resourceful miners and mine owners chose to mine The machine moved to the southwestern region of China or some low-cost regions abroad.
Considering the uncertainty of subsequent domestic regulatory policies and the replacement of high and low water periods in southwestern China, some mining companies have chosen to move mines directly out of the sea in one step.
At present, 65% of computing power may be transferred, especially in Central Asia and North America, where electricity costs are relatively low.
As of 16:00 on June 20th, Beijing time, according to Coinbase data, the price of a bitcoin is about 35,622 US dollars, basically maintaining the level after the sharp drop in May.