One of the major crypto mining pools, BTC.com, operated by BIT Mining and owned by the NYSE-listed Chinese lottery service provider 500.com, announced on Jun. 21, that it has successfully relocated its first batch of mining machines to Kazakhstan. The mining pool was founded by Jihan Wu and operated by Bitmain and Bitdeer before it was acquired by 500.com in February 2021. The mining pool is currently the fifth-largest in the world, and validates 10.4% of blocks on the Bitcoin blockchain. The largest pools are AntPool, F2Pool, Poolin and ViaBTC.
Reasons behind the relocation
On June 19, 2021, BTC.com was notified by State Grid Sichuan Ganzi Electric Power Co. Ltd through its indirectly held subsidiary, Ganzi Changhe Hydropower Consumption Service Co. Ltd, that its power supply would be suspended, effective 9:00 pm Beijing time, June 19,2021. Since then, Ganzi Changhe Data Centre suspended its operations. According to the announcement, data centres in Sichuan, including the Ganzi Changhe Data Centre, contributed approximately 3% of the company’s total revenues in the month of May 2021.
Before this notice, the Chinese region of Inner Mongolia had stated that it would shut down all crypto mining projects by the end of Apr. 2021, as part of broader efforts to improve energy efficiency. After this announcement was made, regional authorities established a dedicated hotline for the local public to directly report any suspected illicit mining activities. This is an area that was previously very popular with crypto miners.
BIT Mining CEO Xianfeng Yang has however stated that their current relocation is as a result of their accelerating overseas development for alternative high-quality mining resources. He added that the company is committed to protecting the environment and lowering its carbon footprint.
Increase in authority’s scrutiny over power-guzzling mining sites
China is an early mover against crypto miners, but other authorities are increasingly stating their concerns over power-guzzling mining sites especially because of negative impact on local energy provision. A former government official Daniyar Akmatov said that crypto mining was a major driver of the energy crisis in Kyrgyzstan back in April. Other areas to voice similar issues are Iran and Caucasus. Elon Musk also aired his concerns and stated that Tesla would no longer accept BTC as mode of payment for vehicles due to the high energy consumption of BTC mining.
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