China’s Inner Mongolia sets up hotline to report block reward miners

Getting your Trinity Audio player ready...

Inner Mongolia, one of China’s largest autonomous regions, is committed to stamping out block reward miners. In its latest move, the region has set up a dedicated hotline for residents to report suspected block reward miners for further action. The coal-rich region was once home to a thriving ecosystem of block reward miners, but pressure from the Chinese national government has turned the local government hostile to the industry.

The autonomous region, located in northern China, is the third-largest administrative division in the Asian country after Xinjiang and Tibet. For years, it was home to several block reward miners who benefitted from its vast coal resources to power their operations. At one point, it was home to 8% of BTC’s hash rate. Then it all changed when the Chinese government began to put measures in place to reduce the country’s carbon footprint. It led the Inner Mongolian government to give miners two months to get out.

The local government is following up on its efforts to stamp out the block reward miners. In a May 18 announcement, the Inner Mongolia Development and Reform Commission revealed it had set up a dedicated hotline and email address for locals to report any suspected block reward miner.

The measure will also target any company that has been posing as a data center to enjoy tax, land and power perks but is instead mining digital currencies. Firms that rent their land to digital currency miners will not be spared either.

The quick action by the local authorities against the block reward miners caught many off guard. For years, the region’s cheap power as well as its cool and dry climate were ideal for the miners. This industry grew over the years, and at its peak, it contributed more in BTC hash rate than the entire United States.

However, with China seeking to reduce its national energy consumption by up to 15% annually, these miners are finding it difficult to find new grounds to set up operations. Weminer, a Beijing-based cloud mining company, revealed that it has had to shut down several phases of its project.

Others, however, have found ways to cope and continue to operate. BTC.TOP, a major Chinese mining pool, is one that started relocating its centers to other “more stable” regions once the Inner Mongolian government started turning against the industry.

Jiang Zhuoer, the BTC.TOP CEO stated, “This incident had little effect on us. We took into account the uncertainties in Inner Mongolia, so there are now only a few mining machines in Inner Mongolia and most of them are in the more stable mines in Xinjiang.”

According to other reports, miners are moving their operations to Yunan and Sichuan provinces, with yet others choosing to leave China altogether.

See also: TAAL’s Jerry Chan presentation at CoinGeek Live, The Shift from Bitcoin “Miners” to “Transaction Processors”