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On May 21, Liu He, member of the Political Bureau of the CPC Central Committee, Vice Premier of the State Council, and Director of the Financial Committee, presided over the 51st meeting of the Financial Stability and Development Committee of the State Council . The meeting called for cracking down on Bitcoin mining and trading and resolutely preventing individual risks from being transmitted to the social field. The result is obvious. Bitcoin, which is extremely sensitive to policy changes, responded quickly. On May 30, the difficulty of Bitcoin mining fell by 16% to 21.05 T, the largest drop since 2021. This market correction shows that some domestic miners have indeed unplugged the power plug.
Bitcoin mining difficulty is a measure of the difficulty of mining, that is, the difficulty of calculating a HASH value that meets a given target. The Bitcoin network has a global block difficulty. A valid area must have a HASH value that must be less than a given target HASH. The mining pool also has a custom shared difficulty to set the minimum difficulty limit for generating shares. The mining difficulty, which is adjusted every two weeks, basically reflects the level of competition between miners. A reduced mining difficulty indicates less competition.
Previously, more than 75% of Bitcoin transaction verification work was handled by domestic miners, but this may change after May 21.
On May 22, Jiang Zhuoer, founder of B.TOP, posted on Weibo in the early hours of this morning: 1. Although B.TOP has not received regulatory requirements from relevant departments, considering the latest regulatory spirit and the fact that B.TOP's business in mainland China only accounts for a small proportion of self-operated mining, there is no need to continue to provide mining machine purchasing services to the public in mainland China and bear additional regulatory risks for this. Therefore, B.TOP decided to stop providing mining machine purchasing services to customers in mainland China. 2. For mining machines that have been purchased and paid for but not running, you can choose a full refund. Please contact your business partner for processing. 3. For mining machines that have been running, although this situation belongs to the force majeure "government intervention, restrictions, and bans" in the contract exemption clause, B.TOP has the responsibility to safeguard the interests of customers. B.TOP will introduce measures to ensure that customers do not suffer losses.
Later, BitDeer officially announced that it will actively cooperate with the regulatory spirit of relevant countries and regions and support the compliance development of the mining industry. From 22:00 on May 26, 2021, Beijing time, BitDeer will block all IP addresses in mainland China to further ensure that the platform does not provide services to residents in mainland China.
Huobi also said that its mining machine mall has decided to suspend providing related services to users in mainland China and focus on expanding overseas business. OKEx also said that it would restrict Chinese customers from accessing certain services in order to maintain consistency with regulatory compliance requirements.
On May 26, Bitfufu, a computing power standardization mining platform strategically invested by Bitmain, announced that it would block all IP addresses in mainland China to further ensure that the platform does not provide leasing services to China. For users whose leasing services have been effective before the platform upgrade, the services will not be affected until the fulfillment is completed.
According to the Caixin article, some regulators have the following ideas for cracking down on Bitcoin mining and trading: 1. People close to the Ministry of Industry and Information Technology said that some listed companies are not doing their job well, buying mining machines and investing in mining farms, including setting up exchanges outside. The article pointed out that Lianluo Interactive, an A-share listed company, invested $14.3 million in mining machines, virtual currency trading and investment in ICO companies; 2. People close to industry researchers said that Inner Mongolia was criticized for not meeting the energy consumption reduction standards, so (cracking down on mining) must be more active; 3. The aforementioned person close to the central bank researchers said, does mining bring any benefits to the real economy? As a result, chip manufacturers prefer to sell to mining machine manufacturers, and the automotive industry is in great need of chips. (This is a misunderstanding. The low-process chips used in the automotive industry are different from the high-process chips used in mining machines. The main reason is that mobile phone chips are consistent with the processes used by mining machine manufacturers).
As it stands, Inner Mongolia has begun cracking down on Bitcoin mining, with the regional autonomous government reportedly considering adding Bitcoin miners to a social credit blacklist and proposing to revoke miners’ telecommunications licenses.
It is worth mentioning that this Bitcoin mining difficulty adjustment will also increase the average time to produce a block to 11 minutes and 55 seconds, which is nearly 4 minutes longer than the average block production time on May 13, when the average block production time was 8 minutes and 14 seconds.
In the last adjustment on May 13, the mining difficulty hit a record high, up 21.53% from the difficulty level set on May 1. But now, the entire market is feeling the reversal of fortune. (Golden Finance) |
