Chinese Police Uncover Several Illegal Bitcoin Mining Sites

China’s government has been taking a hard stance against several aspects of the cryptocurrency industry for months, but have only recently started a campaign against mining. However, a new discovery could harden Beijing against the activity and force lasting legislation against it.

More Reasons for Beijing to Ban Bitcoin Mining

Last weekend, local news source Beijing News reported that law enforcement agents had found an illegal crypto mining operation in Daqing, a city in the northern region of the country. As the report explained, the operation was based out of hat appeared to be two burial locations on an open field.

Per the report, police officers responded to a complaint from a local oil firm that claimed it had suffered some unexplained power losses. They eventually sent agents to the location, when they found an entrance to the surroundings of two burial mounds. Upon further investigation, they discovered some mining hardware running on stolen power.

Another local news source reported that law enforcement agents had discovered 54 Bitcoin mining rigs under a dog kennel in the Heilongjiang province. Those also appeared to have been installed unlawfully, and have been stealing electricity to run.

While China has always allowed for mining to thrive, the fact that illegal mining has also been rampant could provide the government with plausible cause to ban the activity from the country altogether.

As it would appear, Beijing is already in the process of developing a standard that will see crypto mining outlawed in the country. Last month, Asian FinTech news source PA News confirmed in a tweet that the Sichuan province’s financial regulator had issued a directive to all its subsidiaries to “guide” companies that operate in the mining space to start shutting their operations down.

According to the report, the ban will start with the region’s hydroelectric power supply. The authority has reportedly ordered hydroelectric plants to stop all investment in existing crypto projects, while the addition of new projects should stop immediately too.

Any hydroelectric power plan that fails to comply with the directive could face an investigation for illegal construction projects. If found guilty, the plant could face bans, fines, and even self-demolition.

A Switch in Global Hashpower Majority

The Sichuan region currently accounts for 6 percent of the global Bitcoin hashpower, according to the Bitcoin Mining Map from the Cambridge University’s Centre for Alternative Finance (CCAF). While the contribution is just a small portion of China’s overall 65 percent of global hashpower production, it’s still enough to knock the global hashpower distribution out of whack.

Speaking with Cointelegraph, Adam Traidman, the chief executive of Ripple SBI Asia, explained that we could be seeing a migration of global Bitcoin hashpower from the East to the West. He confirmed that the transition has already begun, with China loosening its grip on hashpower and the United States taking more of a commanding role.

Traidman explained that for now, a lot of the big mining hardware providers are still in China. However, a migration is coming soon enough, with Texas leading the charge of the takeover of the United States.