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Huge Bitcoin Hash Rate In China In Jeopardy After Local Authorities Increase Electricity Tariffs For Mining By 33%

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Bitcoin miners in Inner Mongolia can no longer enjoy subsidized electricity rates for their crypto-mining operations, according to chinese news outlet Weixin. The authorities insist that mining companies have not directly benefited the wider Mongolian regions and local government. And now a large number of Chinese miners operating within the border of Inner Mongolia, electricity charges may rise by 33 percent.

This action comes as a blow to Bitcoin miners as around 60 percent of the world’s mining operations are based in China. In addition to some large-scale companies, such as AntPool, which are known for the high-income revenues they generate each year, they are based in the region in question.

China’s colossal Bitcoin hash rate share to drop following the move by local authorities

China controls a vast 60% hash rate on all Bitcoin mining operations in the world but all that is about to change following increased electricity tariffs policy in the Mongolia region. For a long time, the northern part of China has enjoyed favourable conditions conducive for bitcoin mining such as cool climate, cheap labour and subsidized electricity rates.

Bigwig firms like AntPool along with other miners based in Mongolia are likely to be affected negatively, thus resulting in decreased profits generated from mining operations. According to reports, at least 21 mining farms will be affected directly. However, it is worth noting that not all firms have been affected by the authorities’ move.

China inner Mongolia authorities issued the ‘surprise’ notice on 24 Aug 2020. Colin Wu, a famous Chinese reporter who mostly focuses on mining and industry regulations reports, also confirmed the news on his official twitter page.

Crypto mining enthusiasts fear that more regions will follow the policy of the Mongolian authorities

Bitcoin Miners in China are now worried that increased electricity rates directive in Mongolia will now be imposed on other different regions in the country. Xinjiang region is more precisely tipped to be next to offer the instructions after Mongolia.A lot of mining operations will also take a hit in terms of profits generated as the rest of the world now enjoys a more level playing field.

Crypto Mining Operations in Iran extend to Electric Power Plants

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The Government of Iran has recently approved crypto mining operations by power plants in the country. According to reports, Mostafa Rajabi Mashhadi, who serves as Deputy Head of the Power Generation , Distribution and Transmission Company of the country, or Tavanir, has confirmed the approval as he addressed the IRNA on Monday 27 July.

Iran is setting up a Bitcoin mining hub after the country’s subsidized electricity consumption and now miners are setting up a camp. Mashhadi further outlined the regulations that power plants must adhere to in order to operate cryptocurrency mining operations in the Islamic country.

Power plants must comply with set crypto mining operations tariffs

According to Mashhadi, power plants are expected to apply for crypto mining licenses to run their operation. Licenses are to be given to individual power plants by the Ministry of Industry, Mine and Trade.

Power plants are also required to fully comply with set tariffs on electricity consumption as far as crypto mining is concerned. Recent data show just how cheap miners pay for electricity consumption in Iran where one kilowatt of electricity is charged for as low as $0.01 to $ 0.05. The rates are expected to quadruple during the summer season, a situation that forced Tavanir to announce that the Iranian government had decided to reduce up to 47% on all tariffs on the electricity consumption by miners more so during the high seasons.

Allegedly 14 cryptocurrency miners have recently obtained crypto mining licenses to operate in the country. Each of them will have an electrical capacity of 300 megawatts. It is also worth noting that more than 1,000 more licenses have already been issued with permits.

Mashhadi also urged the general public to report any illegal crypto mining operations to the authorities, promising that the government would provide a reward for their actions.

Iranian president proposes a Muslim digital currency

Iran’s commander in chief, Hassan Rouhani has rallied Muslim faithfuls to unite; and come up with their very own Muslim cryptocurrency. He has also voiced his support for a national crypto mining project that he believes will further propel the country to thrive economically amid the current U.S sanctions that face them.