China is the hotbed for cryptocurrency mining. There are plenty of large cryptocurrency mining operations in China. In a recent development, the Chinese authorities specifically the Chinese police have seized over 200 mining rigs. These mining rigs were used for mining Bitcoin as well as Ethereum. The allegation is that the mining operation was stealing electricity rather than paying for it.
The police were alerted by the extraordinarily high power usage in the local grid. When they investigated further, they found that the cryptocurrency mining operation was stealing electricity. In a single month, the cryptocurrency mining operation managed to steal 1,50,000 kW hour of electricity. The cryptocurrency mining operation is operated by Ma. The 1stname of the culprit is not been disclosed. According to the police, the electricity meter of the premises was short-circuited in order to ensure that the consumption of electricity cannot be tracked.
Cryptocurrency Mining Needs a lot of Electricity
Normally, cryptocurrency mining operation requires a large amount of electricity. As more and more blocks are validated, the amount of electricity which is required increases further. The profits are made in the form of cryptocurrencies. When each block is verified, the respective cryptocurrencies are earned by the cryptocurrency miner. With each and every passing block, the difficulty level increases and therefore, the consumption of electricity also increases. According to the police, still, the culprit had not managed to make any profit by tempering the electricity meter.
One of the main reasons why China is at the forefront of the cryptocurrency mining revolution is because of the cheaper electricity rate. Moreover, labor is also cheaper in China. As a result, individuals, as well as businesses, are setting up cryptocurrency operations. Also, most of the mining rigs are manufactured in China. As a result, the hardware is comparatively affordable as well. All of these factors combined, make China one of the best destinations for cryptocurrency miners.
In recent times, there is increasing scrutiny on the operations of cryptocurrency miners. That is why companies are looking to shift elsewhere as well. Also, many other countries are attracting the cryptocurrency mining operations by offering cheap electricity. It remains to be seen whether, in the future, the authorities will encourage the cryptocurrency mining operations further or whether they will encourage it. Up until now, the conditions have not been entirely suitable due to the bureaucratic obstacles.
The Chinese government is not even encouraging the legit cryptocurrency mining operations. They are seizing the supply of electricity to such cryptocurrency mining operations.
