China may further restrict bitcoin mining. Three quarters of the world’s stock of digital currency is still produced in the country. But the large energy consumption involved in mining bitcoin would be at odds with the country’s sustainable ambitions, the American business newspaper writes. The Wall Street Journal.
Bitcoin works on the basis of blockchain technology, a kind of collective log in which all participants together keep track of all transactions. That register is supplemented every ten minutes with a new ‘page’ with the latest changes. To safely handle each addition, a complex mathematical formula must be solved. Worldwide, special computer systems are puzzling on them all day long. That’s called mining.
Whoever solves the formula will be rewarded in bitcoin. The threat from the Chinese authorities to curb bitcoin mining shows that the production of the digital currency, which is beyond the reach of governments, is a vulnerable point. Mining relies on ample supplies of cheap electricity and equipment.
And those are the very elements that China used to become the world’s largest manufacturing country. Beijing in general has difficulty with cryptocurrencies. For years, no legal exchange of bitcoin was allowed in China, even as the country’s entrepreneurs emerged as the main producers.
The country already made the first plans in 2018 to restrict the mining of crypto coins. The Inner Mongolia region, where energy is cheap, is particularly popular. The autonomous region announced earlier that it wanted to limit mining.
Iran previously announced that it would temporarily not allow the mining of bitcoin. With the ban, Iran wants to prevent power shortages during the summer period. Iran is responsible for the production of 4.5 percent of bitcoin worldwide.
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‘China wants to curb bitcoin mining because of energy consumption’ | Tech
Source link ‘China wants to curb bitcoin mining because of energy consumption’ | Tech