
China to crack down on mining of cryptocurrencies, delivering a one-two punch to digital tokens after triggering global sell-off
- The State Council, China’s cabinet, has targeted bitcoin mining enterprises for the first time
- The latest initiative seeks to protect the country’s financial system, as well as meet its clean energy and reduced carbon emission goals
The government will “crack down on bitcoin mining and trading behaviour, and resolutely prevent the transfer of individual risks to the society”, according to a statement by the State Council’s Financial Stability and Development Committee chaired by Vice-Premier Liu He, the Chinese president‘s top representative on economic and financial matters.
“The wording of the statement did not leave much leeway for cryptocurrency mining,” said Li Yi, chief research fellow at the Shanghai Academy of Social Sciences.
The latest statement, however, still stopped short of an outright ban on cryptocurrency mining. It also did not elaborate on the measures involved or scale of this crackdown.
“We should expect the relevant departments, including law enforcement, to come up with detailed measures to ban bitcoin mining in the near future,” Li said.

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“When all mining activities are banned in China, it will be a turning point for the fate of bitcoin, as a large chunk of its processing power is taken out of the picture,” research fellow Li said.
The State Council committee’s statement on Friday, according to Li, also highlighted the “green transformation of development”, representing the central government’s commitment to meet its clean energy and reduced carbon emission goals.
Bitcoin can still be bought in China after latest crackdown
China’s central bank has been promoting its own digital currency (CBDC). Not to be confused with cryptocurrencies, the digital yuan is a digitalised fiat money issued by the People’s Bank of China, equivalent in value to the country’s notes and coins. Chinese financial institutions, banned from handling transactions that involved cryptocurrencies, are embracing the digital yuan.
“When China made carbon neutrality a national strategy, the massive consumption of electricity from bitcoin mining, which does not bring any practical benefits to the country’s economy like manufacturing and agricultural industries, will no longer be tolerated,” Li said.
