Fake News: China's Crackdown On Bitcoin Miners Proves a Hoax
Media reports of a crackdown on Chinese bitcoin miners have turned out to be a hoax after a meeting between the state power company and small hydro operators in Sichuan province.
The Bitcoin mining heartland of China had reportedly put mining operations on notice for their hydroelectric power consumption. A document circulated by a subsidiary of the State Grid Corporation based out of Sichuan province warned small hydropower stations to cease support mining pool operations. Sources now say the whole affair was a case of misunderstanding the intent of an official notice.
A translation by Weixin of the decree issued by Sichuan Electric Power Company dated November 3 read:
"Bitcoin production is illegal business, all grid-connected power stations also belong to the illegal transfer of power operations," requiring its own Upon receipt of the notification date "all stop Bitcoin production," and for the continued illegal transfer of electricity grid-connected power stations, will be "solution net punishment."
But on contacting the Head of Danba County Power Supply Branch, Caixin's correspondent clarified the notice was valid, but the message had been rushed leading to a false stir.
It has now emerged that the notice was prompted by an insufficient supply of electricity to locals in the rural area at a time when the dry season is around the corner. 6 of 9 stations were channeling power from small hydropower plants to support mining operations against electricity contract requirements. So a letter was quickly put together in response.
Just hours ago, a source from China revealed officials and plant operators met on November 15 to resolve the matter. "On the 2nd day, the company and the stations reached an agreement that in dry seasons the latter should prioritize the normal daily supply for the citizens," said cnLedger via a tweet.
With so much mining activity harbored in China's inner provinces, the looming risk of a sudden attack by government hangs in the balance. Some suggest that operations may move to Russia if conditions become unbearably hostile.