Chinese Authorities to Shut Down Illegal Miners

China's Xinjiang Uyghur autonomous region is set to eliminate "illegal" bitcoin mining by the end of September
24 July 2018   1509

The Chinese authorities intend to put an end to the "illegal" bitcoin mining in the Xinjiang Uygur Autonomous Region before the end of August. This is reported by CoinDesk.

The first rumors about the authorities' new plans appeared this weekend after a leak of the documents of the Economy and Information Commission of Xinjiang (EIC). In particular, it says that local suppliers of electric power industry are obliged to stop illegal bitcoin mining and to report it to the authorities.

Authorities note that "illegal mining" also means mining without license and use of electricity without official contacts.

Local utility agencies and companies will be held accountable if they failed to shut down 'illegal' bitcoin mining operations.
 

Economy and Information Commission of Xinjiang

PRC authorities obliged the electricity suppliers from Xinjiang Province to regularly report on the activities of local companies engaged in bitcoin mining.

This decision largely affected the activities of the mining companies that carry out operations in this region. So, Scott Meng, the head of the Canadian blockchainn start-up, who is also engaged in the mining in Xinjiang, said that the measures taken by the Chinese authorities "definitely had an impact" on local companies.

I have two partners (in the region): one has 18,000 crypto miners, the other has 40,000. And they have been crying for help in the past days, urging me to look for places in the U.S. and Canada (as substitutes). But even for me, I have to get electricity first. And even if I had that, we need to build farms from scratch.
 

Scott Meng

CEO, Canadian Blockchain Startup

As reported, in June 2017, the EIC also issued a notice to municipal governments asking them to be careful when supporting bitcoin mining companies.

Layer1 to Receive $50M Investments

These investment helped the startup to reach $200M market value and and will be used to enter mining market
16 October 2019   78

Layer1, backed by the Digital Currency Group (DCG) raised $ 50 million from a number of well-known venture capitalists, including PayPal co-founder Peter Thiel.

According to The Block, thanks to the successful closure of the Series A financing round, the company's market value reached $ 200 million.

Initially, the company focused on supporting the ecosystem of confidential cryptocurrency Grin. However, now the San Francisco-based firm intends to focus on bitcoin mining and plans to compete with Chinese miners over time.

We expect our chips to be competitive for at least eight years now...you want to have your own chips in hand. We also have our own electricity substations: effectively that's as close you can get to owning your own power plan.
 

Alexander Liegl

CEO, Layer1

To implement this plan, the company acquired land in Texas for the construction of substations, entered into a partnership with a Beijing manufacturer of semiconductors and built its own infrastructure for cryptocurrency mining. Ligl added that Layer1 intends to become a vertically oriented company that controls every element in the mining business process chain.

The company also intends to enter the lending and crypto derivatives markets.