Chinese bitcoin farms are feeling the pain of government’s tough crackdown 

Canaan Inc, one of the biggest bitcoin mining hardware manufacturers in China, has expressed its disappointment with the government’s series of crackdowns on mining operations. 

These bitcoin mining operations use high-capacity hardware to solve complex mathematical problems in exchange for bitcoins. The problem is, mining farms consume so much electricity, which accelerates the use of fossil fuels. 

And this situation runs counter to the Chinese government’s aim of achieving its ambitious green goals. 

But Canaan Inc’s CEO, Zang Nangneng, said that what the authorities should focus on are the mining farms that use fossil fuels to power their operations. 

“For-profit miners prefer regions with low electricity prices that indicate oversupply and likely energy waste,” Nangneng said.

The CEO also added that mining farms that use green energy should be spared from the government’s crosshairs. 

The outcome of the crackdowns

Both bitcoin miners and hardware manufacturers are feeling the gradual pain of the Chinese government’s crackdowns. In fact, the spot prices of bitcoin mining machines have slumped to 20-30%. And this is one of the main reasons why Canaan is already preparing for the worst.

The manufacturing company is fast moving overseas to secure long-term contracts, set up an offshore mining business, and start new operations outside China. 

All these things are precautionary measures to protect the company from the devastating effects of the government’s crackdown on mining farms. 

There is still hope

Even with the major problems that the bitcoin mining industry is facing right now, Zhang is optimistic that the government will soon come to terms with the miners. 

“Just as it took a long time to be recognized by the market, there will also be a long process for bitcoin and crypto mining to be recognized by regulators,” Zhang said.

 

Image courtesy of Cointelegraph News/YouTube

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