BTC.com Withdraws from China, AntPool Suspends IP Access, & Tencent Bans 1,000 WeChat Accounts

BTC.com Withdraws from China, AntPool Suspends IP Access, & Tencent Bans 1,000 WeChat Accounts

Bitcoin mining pool BTC.com announced on Friday that it is withdrawing from the Chinese market on October 15, 2021.

It would no longer provide its mining services to users in mainland China to “comply with the latest regulatory policy requirements of the Chinese government.”

Starting today, the registration of new users in mainland China will be suspended, and mining services will be shut down. Users from China are asked to withdraw their crypto assets and complete the migration of computation power as soon as possible.

“We will reserve the right to further dispose of your account,” said BTC.com, the subsidiary of crypto mining company BIT mining Lt. (NYSE: BTCM).

Leaving China Forever

This week, mining machine manufacturer Bitmain’s crypto miner AntPool also announced that to comply with the regulations, starting October 15th, it will suspend IP access in Mainland China (excluding Hong Kong and Taiwan).

“ANTPOOL has no plans to establish an operating entity in mainland China,” said the miner, adding it will rebuild its new business and operating team with Singapore as its headquarters.

Additionally, it will introduce a KYC verification system for the global registered users to abide by the laws and regulations of users’ locations.

The US Gains Dominance

China’s ban on cryptocurrency trading and mining has already had a severe effect on the country’s market share in Bitcoin mining. As we reported, China’s mining share has fallen to zero, from 75% in 2019.

However, China’s loss is turning out to be the US’s gain, whose market share of Bitcoin’s global hash rate has surged to 35.4% and is now dominating. Miners ousted from China have simply moved overseas to the United States, Kazakhstan, Russia, and Canada.

“As a veteran who witnessed the industry’s birth in China, I feel the situation today is lamentable,” said Mao Shihang, founder of F2Pool, in an interview.

“China is losing its share of computing power … the industry’s center of gravity is shifting to the United States.”

No Info on Crypto

This week, Tencent Holdings Ltd. also made a move and imposed a ban on more than 1,000 WeChat accounts.

A total of 1,463 WeChat accounts were banned due to illegally publishing virtual currency and mining-related information, Tencent said in a statement on its website on Thursday. While some accounts were shut permanently, others are facing a week-long restriction.

The tech giant, which has over a billion WeChat members, said that it will “continue to strengthen its corporate responsibility and increase its crackdown on illegal financial activities such as virtual currency transactions.”

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Author: AnTy

Russia has No Plans to Ban Crypto Unlike China, says Deputy Finance Minister

Russia Has No Plans to Ban Cryptocurrencies Unlike China, says Deputy Finance Minister

A Siberian region, which relies heavily on hydroelectric power and is known for its cheap electricity, also saw its energy consumption surging 159% due to an “avalanche” of crypto-mining.

After the US Federal Reserve Chairman Jerome Powell and US Securities and Exchange Commission (SEC) Gary Gensler clarified in no uncertain terms that they have no plan to ban Bitcoin and cryptocurrencies, Russia’s Deputy Finance Minister Alexei Moiseev conveyed the same thoughts.

Moiseev told reporters this week that Russia does not plan to follow the same path as China and introduce a ban on the purchase of crypto by citizens on foreign exchanges, according to a local publication.

“Russian citizens can have a wallet open outside the Russian Federation, but if they operate within the Russian Federation then they will be subject to bans, I think, for the entire foreseeable future, due to our financial sovereignty,” said Moiseev during a “Digitalization of Financial Markets” lecture at MGIMO.

Last month, China strengthened its crackdown on crypto mining and trading; as a result, a flood of Bitcoin miners are now also moving to Russia besides Kazakhstan and the U.S.

A Siberian region, Irkutsk, which relies heavily on hydroelectric power and is known for its cheap electricity, saw retail energy consumption surging 159% this year, from 2020 levels due to an “avalanche” of underground crypto-mining, Governor Igor Kobzev said in a letter to Russian Deputy Prime Minister Alexander Novak.

“The situation is an unpredictable event for the region and is leading to significant loads on the power grid with the risk of accidents and emergencies,” reads the letter, in which Kobzev said the problem has been exacerbated by China’s ban on mining and called for higher electricity rates for miners.

Close Attention on Crypto

While no plans to ban crypto, the digital currency will not be allowed to be used as a means of payment within the country, as this could result in the loss of the government’s control over the money supply, said Deputy Finance Minister.

Moiseev further said that there is a need to define digital currency and blockchain in the country’s Civil Code and in specialized laws.

“The blockchain will obviously occupy its own niche and will be used where equal rights are needed.”

Last week, Anatoly Aksakov, the head of the State Duma Committee on the Financial Market had said that they are keeping “close attention” on the topic of digital assets and thinking about implementing legislative restrictions on the investment of unqualified investors in cryptocurrencies.

These measures, according to him, are necessary to protect private investors as billions of dollars are currently spent on the purchase of digital currency. But while there is a great risk, there is also great profitability, he noted.

“Here, of course, we need to prescribe in the legislation the norms that will protect an unqualified investor in ill-considered investments in digital currencies.”

In July this year, the Central Bank of the Russian Federation issued an information letter recommending Russian exchanges not to admit instruments linked to crypto and advised professional participants in the securities market to refrain from offering their unqualified clients access to crypto and the management company to include them in mutual funds.

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Author: AnTy

The US and its Allies Accuse China of Global Crypto-Jacking and Cyber Hacking

The US and its Allies Accuse China of Global Crypto-Jacking and Cyber Hacking

  • The United States and some of its allies have accused the Chinese government of a global cyber hacking campaign.

On Monday, the US was joined by NATO, the European Union (EU), Britain, Canada, Australia, New Zealand, and Japan to blame China’s Ministry of State Security “with official confidence,” according to a White House fact sheet.

The accusation comes a month after NATO and G7 leaders agreed with US President Joe Biden that China poses systemic challenges to the world.

“The United States and our allies and partners are exposing further details of the PRC’s (People’s Republic of China’s) pattern of malicious cyber activities and taking further action to counter it,” the US senior administration official said.

The Microsoft attack disclosed earlier this year to hackers working with Beijing was explicitly pointed out by the governments. Microsoft has already accused China of this.

China has previously said that they are also a victim of hacking and opposes all cyberattacks.

The governments will accuse Chinese-affiliated actors with “cyber-enabled extortion, crypto-jacking, and theft from victims around the world for financial gain,” the official said. “We’re not ruling out further action to hold the PRC accountable.”

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Author: AnTy

The Price of Graphics Cards Plummet in China After Bitcoin Mining Crackdown

The Price of Graphics Cards Plummet in China After Bitcoin Mining Crackdown

Meanwhile, Nvidia Corp. continues to push for a chip just for cryptocurrency miners where the CEO said they “learned to move faster,” to prioritize its gamer customer base and immune themselves from the worst of any potential crash.

Prices of graphics cards have been plummeting in China following the latest crackdown on cryptocurrency mining.

The Nvidia Quadro P1000 model, an entry-level graphics card, is now available for 2,429 yuan (US$376) on a JD.com franchise store, down from a peak of nearly 3,000 yuan in early May.

Advanced card, Asus RTX3060 is also down at 4,699 yuan from its peak of 13,499 yuan in May on Tmall, operated by JD.com rival Alibaba Group Holding.

The crackdown on cryptocurrency mining has resulted in roughly 70% of Bitcoin mining capacity in China going offline, which is expected to be closer to 90% at the end of this month.

This has resulted in the hash rate falling to 87.3 TH/s, last seen in late October, down 50% from the mid-May peak.

Amidst this, Nvidia Corp. continues to ask crypto miners not to buy its latest high-end computer graphics chip, GeForce RTX 3080 Ti and the RTX 3070 Ti, to prioritize its core gamer customer base.

As we reported, in order to discourage miners from snapping all the supply, the company has deliberately stripped out the products’ ability to effectively mine cryptocurrencies.

According to Jon Peddie Research, an estimated 25% of the add-in graphics cards, about 700,000 cards for a total value of $500 million, were shipped in the Q1 of 2021 went to miners or people looking to resell them for a profit.

As such, Nvidia is specifically pushing a chip just for the miners. The company projects $400 million revenue in the second quarter from the introduction of these crypto-mining processors (CMPs) created exclusively for miners.

“With CMP, we learned to move faster,” said Jensen Huang, Nvidia’s chief executive officer. Huang thinks he’s inoculated the company from the worst of any potential crash caused by crypto-mining graphics card use and disposal, as happened in November 2018 when the company had to cut its annual sales forecast to $2.7 billion, $700 million less than analysts’ estimates that caused investors to dump the stock sending its prices down by 20% in two days.

According to Huang, crypto mining will continue, and digital assets are here to stay. At the Computex show this month, he told reporters, he’s hoping that cryptocurrency markets reach the size that will make the special-purpose chips a worthwhile investment.

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Author: AnTy

Bitcoin Network Can Start Recovering with Hash Rate Dumped 50%, Chinese Miners Already Migrated Overseas

Many small and medium-sized operations in China are also not affected. The upside further means the path to recovery is faster, and miner capitulation usually represents the best buy signals in Bitcoin history.

Bitcoin hash rate dropped to 91.2 Th/s over the weekend, a level last seen in early November, representing a decline of 47% from its all-time high of 171.4 Th/s on May 13. As of writing, the hash rate is back above 104 Th/s.

As a result, block time has reached above 14 minutes, the same as in mid-April. Difficulty meanwhile is at 19.93 trillion last seen in January, after the recent negative adjustment. Bitcoin mining profitability is still at 0.226 per day for 1 THash/s, at late January levels.

The latest drop came after Bitcoin mining farms in Sichuan were closed on Sunday. Central and provincial government-owned power companies were ordered to immediately stop electricity to crypto mining projects.

Sichuan is 90% renewables powered, and about a year and a half ago, it represented more than 50% of the Bitcoin network.

According to an estimate by the University of Cambridge, about 65% of the world’s Bitcoin mining took place in China as of April 2020.

According to a Communist Party-backed Global Times report, this closure of so many Bitcoin miners in the province has resulted in more than 90% of China’s Bitcoin mining capacity being shuttered.

Many small and medium-sized Bitcoin mining farms in China, however, haven’t been affected, and neither has Ethereum, Filecoin, and Chia mining.

Additionally, new pools such as Foundry USA launch now account for more than 7% of the global network and have entered the top 10 mining pools list.

China’s clampdown helped ViaBTC temporarily become the world’s largest bitcoin mining pool. Its founder Yang Haipo said for over two years, its mining pools and other businesses have begun to resolutely take the international route and de-sinicize.

“Institutional miners had already started migrating overseas from China as early as March,” said Sino Global capital. And expecting more bans came from the officials, “Chinese miners accelerated their process of migration to other countries.”

Kazakhstan AIFC officials are also looking for Chinese miners as they have power facilities with a capacity of 1,685 MW, which can help establish a managed mine within 3-4 weeks. Jonathan Cheesman, head of over-the-counter and institutional sales at crypto-derivatives exchange FTX said,

“Longer term most see hashrate moving out of China as positive but in the near term may have/has already resulted in inventory sales.”

China’ mining shutdown is leading to a real drop in hash rate and may cause a difficulty adjustment and perhaps even slightly slower blocks for a while, “but it’s not yet that big relative to the last 3 years (see below). And we’d prefer this to a firewall attack,” said Balaji Srinivasan, former Coinbase CTO, and General Partner at Andreessen Horowitz.

In a separate tweet, Srinivasan noted that Bitcoin mining is actually no longer in the exponential growth phase. He added,

“Hashrate isn’t increasing 100X in a year, hardware now lasts longer, opex/capex is more predictable, and tools for bounding risk now exist. So it’s easier to mine anywhere.”

Charles Edwards of Capriole Investments noted that we are now seeing the worst-case scenario for a China mining ban played out. “The brunt of the force of the China mining bans has been dealt. We are at a point where the network can now start to recover,” he wrote.

The upside here could mean the path to recovery is faster, given that mining is still largely profitable and that this capitulation wasn’t caused by genuine business collapse, said Edwards adding, Miner capitulation usually represents the best buy signals in Bitcoin history.

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Author: AnTy

Sichuan, China Regulators Meeting up with Power Companies Regarding Crypto Mining

Sichuan, China Regulators Meeting up with Power Companies Regarding Crypto Mining

Sichuan, which is the largest hydropower mining area in China and accounts for 10% of China’s hash rate, is not the only province gathering information on crypto mining.

The situation in China about crypto mining hasn’t become clear yet but the good thing is the Sichuan government is holding a virtual currency mining research symposium where it will meet local power companies regarding crypto mining.

Sichuan is not the only province gathering information on crypto mining, an official at the Sichuan Energy Regulatory Office of National Energy Administration told Reuters.

To be held on June 2nd, the energy regulator is aiming to analyze the impact of shutting down mining on the consumption of wastewater and gather suggestions, as per local publication Wu Blockchain.

Sichuan is the largest hydropower mining area in China and accounts for 10% of China’s hash rate.

As we reported, Chinese miners have already started to make their way overseas ahead of the government providing clarity on crypto mining. Some large miners have booked the mines in North America, Kazakhstan, and Russia. However, compared to China, these regions will cost them much more.

According to Chinanews, Binance’s hash rate coin BTCST has also reportedly invested $3.1 million to acquire a mine in Tbilisi, Georgia, with a capacity of 29 million watts.

Amidst this, Spartan Black of crypto fund The Spartan Group shared that the date July 1st is of significance in China’s context as this marks the 100th year anniversary of the founding of the Chinese Communist Party. He said,

“The CCP needs to ensure stability ahead of the CCP centennial celebrations on July 1st. Heads will roll if there are any social disturbances ahead of one of the most important events in CCP history.”

This could further explain the sudden “change” in the government’s stance toward crypto assets, which the PBOC governor termed as an alternative asset class only last month.

Meanwhile, after reacting negatively to China banning Bitcoin and mining, the price of BTC is now showing signs of recovery.

But while BTC has gone past $40,000, the market is not sure about what’s to come next. It is expected that Bitcoin can very much continue to trade sideways for months before it goes on to hit new highs.

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Author: AnTy

China Bans Crypto For the 100th Time; Hong Kong to Restrict Retail Traders From Exchanges

Breaking: China Bans Crypto For the 100th Time; Hong Kong Proposal Seeks to Restrict Retail Traders From Exchanges

Cryptocurrency exchanges in Hong Kong are set to be prohibited from offering services to retail crypto traders following a new government proposal.

Hong Kong Floats New Proposal On Licensing Crypto Firms

The legislative proposal, which Hong Kong’s Financial Services and Treasury Bureau (FSTB) floated, has now moved past its consultation period, Reuters report.

During its consultation conclusions, the FTSB disclosed that all virtual asset service providers (VASPs) or cryptocurrency exchanges operating in Hong Kong would need a license to do so once the law is passed.

The regulator also said the services of cryptocurrency exchanges would now be restricted to only professional investors. The exchanges would be prohibited from offering services to retail traders until the initial stage of the licensing regime is over.

According to Hong Kong law, an individual must have a portfolio of HK$8 million ($1.03 million).

Hong Kong has one of the largest cryptocurrency exchanges in operation. Its opt-in approach under which exchanges can either choose to apply to be licensed by the regulator or not has provided a flexible environment for exchanges to operate in.

This new rule could drive exchanges out of Hong Kong and push investors onto unregulated venues.

Hong Kong Tightening The Noose On Anti-Money Laundering Regulations

Like many other countries, the Hong Kong Government has been assessing how they can regulate the cryptocurrency industry. Lack of investor protection and money laundering are particular concerns of the country.

Today’s announcement forms the conclusion of a consultation process that ran from November 2020 to the end of January 2021.

The Hong Kong government is also reportedly planning to empower the city’s Securities and Futures Commission (SFC) to withdraw the licenses of already authorized crypto exchanges.

When signed into law, the proposal would see the SFC provided with necessary intervention powers to impose restrictions or prohibit companies from providing crypto services.

Away from the companies, the proposal would also bring the SFC more powers to protect clients against potential misconduct from VASPs.

Other Asian countries like Singapore and China also have their regulations regarding cryptocurrency. Singapore requires all crypto exchanges to be licensed before they can operate, however unlike Hong Kong, retail traders can invest.

China recently reiterated its tough stance on cryptocurrencies. On Tuesday, the country announced a ban on banks and payment companies offering crypto-related services.

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Author: Jimmy Aki

Microsoft-Led Consortium Invests $1.3B in Decentralized Storage Facility in China to Mine FIL

Microsoft-Led Consortium Invests $1.3B in Largest Decentralized Storage Facility in China to Mine Filecoin (FIL)

Chinese tech consortium IPFS Union is investing over $1.3 billion to build China’s largest decentralized storage in Jiangxi Province of Fuzhou City. As part of its “Big Data Industrial Park” project, the facility will mine Filecoin (FIL), a peer-to-peer data storage platform, allowing users to buy and sell storage without a third party, a blog post by Filecoin read.

Filecoin has been attracting wide attention across China in the past few months since the network upgraded to mainnet. According to the post, this mining facility is expected to be the largest distributed storage facility in China to boost the union’s vision in big data.

The consortium boasts of some big tech players such as Microsoft, AMD, Huawei, Alibaba, and SAP leading the globe in cloud storage, large cluster data management, and internet infrastructure for the past ten years.

“We’ve been active in the blockchain space since 2016, primarily focused on digital currency investment, but not really participating in development.”

“We were looking for a project with both investment value and a mature ecosystem.”

Filecoin has been one of the top performers so far across the crypto market, popping into the top 15 largest cryptos by market cap earlier in the year. The project was added to Grayscale’s Investment Trust shortly after gaining a listing on Coinbase Pro in December.

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Author: Lujan Odera

Chinese State Media: BTC Bull Market Can Cause Long-Term Downward Pressure on Gold

In 2020, China has repeatedly been pointing out the bull run the largest digital asset is enjoying, and yet again, before the year is over, it went at it again, but this time, it took one step further.

Over the weekend, CCTV, China’s state media’s Bitcoin coverage, involved its bull market, causing downward pressure on the precious metal.

Bitcoin getting airtime on the state media is significant in itself, but it is more so when compared with the traditional safe-haven asset, which has high demand in the country.

Interestingly, when it comes to global gold demand that includes jewelry, technology, bars, coins, and ETF, China, along with India, accounts for the highest, 24% each.

“It’s truly incredible if you think about it. A decade ago, we started printing a digital ledger, which today is still less than 1 terabyte that’s sucking the life out of an element on the fucking periodic table that has existed since the dawn of universe…” noted analyst Qiao Wang.

The CCTV report quoted JPMorgan’s report predicting a major shift in crypto and gold markets as digital assets become increasingly popular as an investment asset class.

“The adoption of bitcoin by institutional investors has only begun, while for gold, its adoption by institutional investors is very advanced,” wrote JPMorgan strategists earlier this month while noting that money poured into the Bitcoin fund since October year while moving out of gold.

According to the strategists, the trend that started this year is only going to continue in the long run as more institutional investors jump on the Bitcoin bandwagon.

“If this medium to longer-term thesis proves right, the price of gold would suffer from a structural flow headwind over the coming years,” wrote JPMorgan’s strategists at the time.

In its latest report, the banking giant said Bitcoin adoption by institutional investors achieved another milestone with MassMutual’s $100 million BTC purchase that could see an additional $600 billion in Bitcoin demand.

Back in Sept., CCTV also reported that cryptocurrency is the best-performing asset of the year has surpassed other investment classes like gold and US stocks.

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Author: AnTy

PBOC Planning Technical Pilot Testing of Digital Renminbi (e-CNY) for Cross-Border Payments

The central bank of China and Hong Kong Monetary Authority is now discussing the technical pilot testing of digital renminbi for cross-border payments, said HKMA on Friday. The launch date for e-CNY hasn’t been set yet.

Sharing the recent development in the cross-border payment area, Eddie Yue, the chief executive of Hong Kong’s central banking institution wrote,

“The HKMA and the Digital Currency Institute of People’s Bank of China are discussing the technical pilot testing of using e-CNY, the digital renminbi issued by the PBOC, for making cross-border payments, and are making the corresponding technical preparations.”

He further notes that with renminbi already in use in Hong Kong and e-CNY being the same as cash in circulation, “it will bring even greater convenience to Hong Kong and Mainland tourists.”

This development was shared in HKMA’s article on “A New Trend for Fintech – Cross-border Payment,” where it talks about the share of e-payment in Hong Kong being one of the highest among the world’s developed economies.

While the domestic payment service has become highly digitized, development in cross-border payments is lagging behind globally.

For this, HKMA launched a joint research project with the Bank of Thailand last year to address the various cross-border payment issues by using central bank digital currencies (CBDC) and a blockchain platform. Yue noted,

“The research project has entered its second stage, including exploring specific business applications as well as the operability and scalability of the platform to allow the participation of three or more CBDCs.”

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Author: AnTy