Chinese authorities have arrested 1,100 people and liquidated 170 companies on charges of money laundering using cryptocurrencies. This was reported by the Ministry of Public Security via its official WeChat account. This is the fifth such raid in the country against money laundering in recent months.
China has the highest concentration of Bitcoin miners in the world. In recent months, the PRC has been tightening regulations surrounding cryptomining and trading across the country. (www.lambertsfruit.com) Initially, a ban on mining was placed in the province of Inner Mongolia. Following this, the People’s Bank of China issued a notice prohibiting companies from supporting cryptocurrency-related businesses.
On the 2nd of June, the Chinese province of Sichuan also prohibited cryptomining in order to better utilize the surplus hydro-power in the region. Finally, on the 9th of June, some of the largest mining hubs of Xinjiang province were ordered to cease operation.
While the government has been consistently speaking out against digital currencies, calling them unreliable and a hazard to the economy, it’s likely that the enormous energy consumption of mining farms is one of the driving factors behind these new restrictions.