China plans to deter bitcoin miners by curbing electricity use
China aims to drive cryptocurrency miners out of business by limiting power consumption
The curbs will also involve other regulators such as the National Development and Reform Commission (NDRC), which oversees the power supply. The PBOC didn’t immediately respond to a fax requesting comment sent after the close of regular business hours.
“This may have contributed to bitcoin coming off its daily highs and electricity usage certainly appears to be a significant challenge for the cryptocurrency in the years ahead,” said Craig Erlam, senior market analyst at online trading firm Oanda in London.
Bitcoin, which surged 15-fold last year, pared gains on Wednesday and traded around US$15,086 on Thursday.
China is home to many of the world’s largest bitcoin miners, who use massive computing power to verify transactions in the cryptocurrency. The global industry uses as much electricity as 3.4 million homes in the US, according to the Digiconomist Bitcoin Energy Consumption Index.
Beijing’s scrutiny of miners follows a sweeping cryptocurrency crackdown last year. Authorities outlawed initial coin offerings in September and have called on local exchanges to halt virtual currency trading.