The World’s Bitcoin Mining Metropolis is Facing a Problem

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China’s Xinjiang is a world leader where a significant portion of Bitcoin is mined. Bitcoin’s price in recent months has been soaring, with influential people such as Elon Musk helping its growth by openly supporting cryptos. Cryptocurrencies have entered every pore in our society. They are largely accepted at many online merchants and are a pretty popular choice to use in Bitcoin casinos too. It has become easier than ever to get your hands on cryptos, but the supply may soon dry up.

Xinjiang is currently facing a serious problem that may halt its booming Bitcoin mining industry. Beijing has recently been accused of conducting mass human right abuses, with many countries banning imports from the region. Additionally, China has announced plans for the inner Mongolia region to ban new cryptocurrency mining projects in a bit to cut-down energy consumption.

Since most of these operations are in Xinjiang, Bitcoin is facing a massive reputational problem in the region which will have repercussions all over the world.

Human Rights Abuse

Xinjing is facing a serious ethical dilemma after the West has accused China of human rights abuse activities in its so-called educational camps located in that region. More than 1 million Uyghur Muslims have been detained in these camps, with first-person reports suggesting torture, rape, and forced sterilization taking place in them.

Of course, China has denied any wrongdoing, suggesting that the camps are helping Uyghurs to eradicate extremist thoughts. Rarely anyone is buying that, so the unethical treatment in the camps has led the USA to ban the import of goods from the region. This could be a serious logistical problem for Bitcoin miners in the area who will be left without the necessary tools and hardware. Of course, it will halt the Bitcoin mining operations too, which will surely impact the price of cryptocurrencies and their unstoppable march in several industries.

At the same time, there’s another problem that could see Xinjiang shut down the mining operations.

Too Costly for the Environment

Increased energy consumption is becoming a massive problem for China. Air pollution due to high carbon emissions have resulted in a charge against coal-fired plants and similar heavy industries in China. The country has vowed to stop carbon emissions quickly, urging provinces to cut down on energy consumption.

Inner Mongolia which accounts for nearly 9% of Bitcoin mining in China as of last year, will ban crypto mining in April 2021 to meet Beijing’s requirements. This has led miners to look for energy alternatives, turning their attention to countries such as Norway and Iceland who have surplus natural gas.

Xinjiang must comply with the new laws but that could mean a serious cutback on the mining. With miners looking in other directions, Bitcoin mining may suffer a significant blow that will surely have repercussions elsewhere.

While experts are adamant that it shouldn’t destroy the cryptocurrency, it could deal a massive blow. With regulatory frameworks in many countries against it, Bitcoin could be in trouble soon.

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March 3, 2021: • No Comments

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