Bitcoin mining ban in China a ‘game changer’ for electric vehicle adoption

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China’s latest move to restrict Bitcoin mining – the decision to ban Bitcoin mining machinery in the country – is a game changer for the adoption of electric vehicles in the country. This is because Bitcoin mining has become a large-scale industry in China, with an estimated 1 to 2.5 million rigs currently operating in some 300 mining facilities. This has led to a boom in the use of electricity in the country, with China now the world’s biggest consumer of electricity, so much so that the country now consumes as much electricity as the whole of the United States.

When China made it extremely difficult for Bitcoin miners to operate in the country, the value of the cryptocurrency plummeted – and so did its appeal as a currency for anyone not mining (or making) bitcoin.

China’s ban on transactions involving new cryptocurrencies may have a significant effect on the electrification of the automobile, according to a new study. The Chinese government’s ban on initial coin offerings, or ICOs, has resulted in a significant increase in the price of bitcoin, which is now used to power the encryption that makes cryptocurrencies unique. Those who mined the cryptocurrency a few years ago have built up large positions, while people who are more recently entering the market may have to buy it.. Read more about what happens if china bans bitcoin mining and let us know what you think.

Bitcoin mining ban in China a ‘game changer’ for electric vehicle adoption

 

Guizhou province has become the country’s first to utilize its freed-up power capacity to promote a climate-conscious agenda, after Beijing’s crackdown on energy-sapping Bitcoin (BTC) mining. 

In 2021, the hydroelectric-rich southern province plans to construct at least 4,500 electric vehicle (EV) charge stations. In 2022, the number will increase to 5,000, and in the following year, to 5,500.

According to the South China Morning Post, Beijing’s pressure on Bitcoin miners has freed up more than 50 terawatt-hours (TWh) of energy, enough to power a 1 million-person industrial metropolis for 33 years or to charge 10 million Tesla Model 3s per year.

China was an early and decisive mover against crypto mining on the world arena, pushing pools that had previously benefited from cheap, excess electricity to close business and migrate abroad. Guizhou’s provincial government is now taking use of this surplus to encourage the region’s 38 million people to change their lifestyles in accordance with Beijing’s decarbonization goals. Guizhou’s EV plan, according to Cao Hua, a partner at the private equity company Unity Asset Management, is “a double dose of excellent news for China’s economy”:

“The greatest illustration of how China strives to achieve its carbon neutrality objective is cracking down on power-hungry Bitcoin miners and utilizing the surplus capacity to promote development of the future of mobility.”

Guizhou, which has one of the lowest per-capita income levels in the nation, plans to construct 38,000 electric vehicle charging stations by 2023, with at least one in each town and 20% of parking spaces at shopping centers set aside for EV charging stations. Residents and industries in the area have informed SCMP that they anticipate the province government to provide incentives and consumer discounts to encourage adoption. 

One local EV battery provider stated the industry is already following the new agenda upstream in the manufacturing line. “We’re thinking about expanding into those regions because they may provide additional incentives to get businesses to make goods that adhere to their environmental policies,” he added.

China’s number of public and privately owned electric vehicle charging stations has allegedly risen by over 47 percent in the last year. Despite this, the overwhelming bulk of infrastructure is concentrated in the wealthiest cities and regions. According to the SCMP article, the shift in capacity use in previous Bitcoin mining hotspots – including Qinghai, Inner Mongolia, Xinjiang, Yunnan, and Sichuan – may be a “game-changer” for China’s push to promote electric vehicles.

As Chinese miners turn off their computers, the hash rate of bitcoin falls to an eight-month low.

Extending charging stations to rural and undeveloped regions is a major task, but it is necessary to alleviate potential EV users’ “range anxiety” — that is, the question of how far they can go without running out of battery life. As a result, the transition to electric vehicles requires a concerted effort by provincial governments, automakers, and battery manufacturers to adequately ramp up investment and production levels at scale. Beijing is now aiming for three out of every five cars in the nation to be fueled by non-fossil fuels by 2030, compared to the United States’ goal of 50 percent.

Apart from environmental issues, many governments across the globe have stepped up their opposition to Bitcoin mining this year, citing worries about the effect on local energy supplies. A former Kyrgyz government official said in late April that crypto mining was a significant cause of the country’s energy problem. In order to save electricity throughout the summer months, licensed Iranian miners have been prohibited from working in the nation until September.

China is a major exporter of miners, with many of the world’s bitcoin miners based in the country. And while the government is known to censor the internet and press, users have found a workaround in the form of mining pools. But a new law signed by Chinese President Xi Jinping will effectively ban all mining in the country by the end of 2017. Since the law is not retroactive, miners can continue operating until then. However, it makes sense to install new mining hardware before the ban comes into effect.. Read more about how many times has china banned bitcoin and let us know what you think.

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Emilia James
By Emilia James

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